Refund Claim: Exports with Payment of Integrated Tax

Article by: CS Payal Kataria


Exports are considered as Zero rated supplies. As per section 16(1) of IGST Act  “Zero rated supply” means any of the following supplies of goods or services or both namely:-

  • Export of goods or services or both; or
  • Supply of goods or services or both to Special Economic Zone developer or a Special Economic Zone unit.

As Per Section 16(3) of IGST Act, a registered person making zero rated supply shall be eligible to claim refund under either of following options, namely:-

  • he may supply goods or services or both under bond or letter of undertaking, subject to conditions, safeguards and procedure as may be prescribed, without payment of integrated tax and claim refund of unutilised input tax credit; or
  • he may supply goods or services or both, subject to such conditions, safeguards and procedure as may be prescribed, on payment of integrated tax and claim refund of such tax paid on goods or services or both supplied,

in accordance with provisions of Section 54 of CGST Act or rules made thereunder.

Refund claim under exports:

i) with payment of IGST

ii) without payment of IGST (Furnish Bond or LUT)

This article deals with refund claim under the option Exports made with Payment of IGST

Since the roll out of GST, Exporters had been worried and concerned about their refunds. Exports with payment of IGST Integrated tax is blocking their working capital and Government is extending date of filing Form GSTR 1, causing more hassles in getting refunds. Reason being, refund payment cannot be made unless both forms GSTR 1 and GSTR 3B are filed.

To solve this genuine problem of Exporters, Government came with a solution to allow filing of Table 6A of GSTR 1 separately from the month of August onwards. For the month of July 2017, refund process for exporters has already been started as filing of GSTR 1 and GSTR 3B had been done.

Basic Conditions for claiming Refund with Payment of IGST

Logically it is valid that unless returns showing export details and payment of taxes have been made, refund cannot be claimed. Therefore Exporters should file the relevant return and pay taxes timely, to get timely refunds.

Thus it is obligation of exporter to file GSTR-1, providing Export details in Table 6A of GSTR-1 along with shipping bill details having Integrated Tax levied and file GSTR-3B of the relevant tax period for which refund is to be paid.

Conditions for claiming Refund:

a) Filing of GSTR1 / Table 6A

b) Filing of GSTR-3B

Refund Process:

For claiming refund with payment of IGST, there is not any requirement of filing separate application for refund. Shipping bill is considered as refund application. Once Exporters comply with all conditions for claiming refunds, GST Portal will share export data declared under GSTR 1 along with validation that GSTR 3B has been filed for relevant tax period with ICEGATE. Thereafter custom system will validate data provided in GSTR 1 with shipping bill and Export General Manifest and credit the refund payment in bank Account Maintained with ICEGATE. Further ICEGATE will intimate GST Portal about refund payment information and GST portal in turn will inform concerned taxpayer through email and SMS.

Points to Remember:

  • Once table 6A filed separately then at the time of filing GSTR 1, Table 6A will be auto populated in non-edit mode
  • Table 6A can be filed in sequence only e.g first file for August thereafter September and onwards.
  • Table 6A cannot be revised however amendment in 6A can be made using table 9 in form GSTR 1 of subsequent tax period.
  • If shipping and invoice details are missed in one tax period, these missed details can be shown in subsequent month and refund for the same can also be claimed in that month.

Reasons for delay in Exports GST Refund:

  • Airline and shipping companies are not submitting proof of Exports to Customs
  • Mismatch of invoice number in Shipping bill and GST Return Forms

FIEO said:

  • despite the custom department allowing manual filing of Input Tax credit refund claims more than 10 days ago, the required application Form RFD 01A is not available on GST Portal.
  • Only few IGST Claims of July has been paid Process has not even started for input tax credit

Industry estimates that 85% of refunds are on account of Input tax credit and 15% from IGST

Delay in refunds are pegged at as much as Rs 50,000 crore


Disclaimer: This article is for general information purpose and not an advise. The author do not assume and hereby disclaim any liability to any party for any loss, damage, or disruption caused by errors or omissions, if any.

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