Exporters' GST refund: Fin Min says only Rs 14,000 crore pending

New Delhi: The finance ministry on Wednesday said GST refunds worth Rs 14,000-crore to exporters are pending with the government and "solutions" are being put in place to fast-track clearances.

Refuting claims by the Federation of Indian Export Organisations (FIEO) which had yesterday claimed that refund clearance has slowed down and pegged pending refund at over Rs 20,000 crore, the ministry in a statement said Rs 8,000 crore was sanctioned during May.

"Refund claims to the tune of Rs 14,000 crore (Rs 7,000 crore on the IGST side and Rs 7,000 crore on account of ITC) are pending with the government as on date, as against the figure of Rs 20,000 crore projected by FIEO in the press reports," the ministry said.

So far, the government has sanctioned more than Rs 30,000 crore as GST Refund. This includes an amount of Rs 16,000 crore of IGST and Rs 14,000 crore of ITC (input tax credit). The figures of ITC include sanction by both the central and state governments, the ministry said.

"In order to liquidate the pendency, the government is starting a second “Special drive Refund Fortnight” from May 31, 2018 to June 14, 2018. "This time the “Special Drive Refund Fortnight” would facilitate all types of refund claims in which customs, central and state GST officers will strive to clear all GST refund applications received on or before April 30, 2018. This will include refunds of IGST paid on exports, refunds of unutilised ITC and all other GST refunds submitted in FORM GST RFD-01 A," the ministry said.

In the first phase of refund fortnight observed between March 15-30, the Central Board of Indirect Taxes and Customs (CBIC) had cleared refunds totalling Rs 17,616 crore. This comprised Rs 9,604 crore of Integrated GST refunds, Rs 5,510 crore ITC refund by the Centre and Rs 2,502 crore ITC refund by states.

The CBIC is implementing a solution whereby the refunds held in GSTN, in cases where the exporters have mistakenly declared their export supplies as domestic supplies, would now be transmitted to Customs EDI system.

"On receipt of the records from GSTN, the customs system would automatically process the refunds for sanction, if no other errors are committed by exporters," the ministry said.

Besides, it has also clarified on matters related to refund claims by an input service distributor, composition dealer, exports of services and supplies made to SEZ.

The circular also clarifies issues related to requirement of LUT in cases of export of exempted or non-GST goods and scope of restriction imposed under Rule 96(10).

"All claimants may note the refund application in FORM GST RFD-01A will not be processed unless a copy of the application, along with all supporting documents, is submitted to the jurisdictional tax office. Mere online submission is not sufficient," it added.

It asked all exporters with pending GST refund to approach their jurisdictional tax authority for disposal of any of their refund claims submitted on or before April 30.

"In case the jurisdiction (i.e. Centre or State) has not been defined for a particular claimant, he/she can approach either of the jurisdictional tax authorities," it said.