CBIC Clarifies Refund Regularization for IGST on Exports

By Admin | September 11, 2024
Categories: 54th GST Council
4 Min Read

The Central Board of Indirect Taxes and Customs (CBIC) issued a new clarification on refund procedures for Integrated Goods and Services Tax (IGST) via Circular No. 233/27/2024-GST, dated September 10, 2024. This update specifically addresses exporters who imported inputs without paying IGST and compensation cess under certain exemptions.

Clarification on Refund Regularization

Previously, Rule 96(10) of the CGST Rules blocked refunds of IGST paid on exports if the importer received concessional benefits from specific notifications. Now, exporters who imported inputs under Notification No. 78/2017-Customs or Notification No. 79/2017-Customs, and initially avoided paying IGST and compensation cess, but later paid these taxes, can now regularize their refund claims.

Retrospective Amendment to Rule 96(10)

CBIC highlighted that Notification No. 16/2020-CT, dated March 23, 2020, added an explanation to Rule 96(10). This update specifies that if exporters pay IGST and compensation cess after importation, it will be as if they had not used the exemption benefit. Consequently, exporters can claim refunds of IGST paid on exports, provided Customs authorities reassess the Bill of Entry.

Publicizing the Clarification

The circular requests issuing trade notices to inform exporters and stakeholders about these changes. This will help ensure that everyone affected is aware of the updated procedures and can benefit from them.

In summary, these changes aim to simplify the refund process for exporters and resolve earlier ambiguities related to IGST claims.

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