The Central Board of Indirect Taxes and Customs (CBIC) GST Policy Wing issued a clarification on certain refund-related issues- reg. vide Circular No. 166/22/2021-GST.
Circular No. 166/22/2021-GST
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
New Delhi, Dated the 17th Nov, 2021
The Principal Chief Commissioners/Chief Commissioners/Principal Commissioners/
Commissioners of Central Tax (All)
The Principal Directors General/ Directors General (All)
Subject: Clarification on certain refund related issues- reg.
Various representations have been received from taxpayers and other stakeholders seeking clarification in respect of certain issues relating to refund. The issues have been examined. In order to ensure uniformity in the implementation of the provisions of the law across field formations, the Board, in exercise of its powers conferred by section 168(1) of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”), hereby clarifies each of these issues as under:
|1.||Whether the provisions of subsection (1) of section 54 of the|
CGST Act regarding time period, within which an application for
refund can be filed, would be applicable in cases of refund of
excess balance in electronic cash ledger?
|No, the provisions of sub-section (1) of|
section 54 of the CGST Act regarding time
period, within which an application for
refund can be filed,would not be applicable
in cases of refund of excess balance in
electronic cash ledger.
|2.||Whether certification/ declaration under Rule 89(2)(l) or 89(2)(m) of|
CGST Rules, 2017 is required to be furnished along with the application
for refund of excess balance in electronic cash ledger?
|No, furnishing of certification/ declaration|
under Rule 89(2)(l) or 89(2)(m) of the CGST Rules,
2017 for not passing the incidence of
tax to any other person is not required in
cases of refund of excess balance in electronic cash ledger as unjust enrichment clause is not applicable in such cases.
|3.||Whether refund of TDS/TCS|
deposited in electronic cash ledger
under the provisions of section 51
/52 of the CGST Act can be
refunded as excess balancein cash
|The amount deducted/collected as|
TDS/TCS by TDS/ TCS deductors under the
provisions of section 51 /52 of the CGST
Act, as the case may be, and credited to
electronic cash ledger of the registered
person, is equivalent to cash deposited in
electronic cash ledger. It is not mandatory for
the registered person to utilise the TDS/TCS
amount credited to his electronic cash ledger
only for the purpose for discharging tax
liability. The registered person is at full
liberty to discharge his tax liability in respect
of the supplies made by him during a tax
period, either through debit in electronic
credit ledger or through debitin electronic
cash ledger, as per his choice and availability
of balance in the said ledgers.
Any amount, which remains unutilized in
electronic cash ledger, after discharge of tax
dues and other dues payable under CGST
Act and rules made thereunder, can be
refunded to the registered person as excess
balance in electronic cash ledger in
accordance with the proviso to sub-section
(1) of section 54, read with sub-section (6) of
section 49 of CGST Act.
|4.||Whether relevant date for the|
refund of tax paid on supplies
regarded as deemed export by
recipient is to be determined as per
clause (b) of Explanation (2) under
section 54 of CGST Act and if so,
whether the date of return filed by
the supplier or date of return filed by
the recipient will be relevant for the
purpose of determining relevant
date for such refunds?
|Clause (b) of Explanation (2) under Section|
54 of CGST Act reads as under:
“(b) in the case of supply of goods
regarded as deemed exports where
a refund of tax paid is available in
respect of the goods, the date on
which the return relating to such
deemed exports is furnished;”
On perusal of the above, it is clear that
clause (b) of Explanation (2) under section
54 of the CGST Act is applicable for
determining relevant date in respect of
refund of amount of tax paid on the supply
of goods regarded as deemed exports,
irrespective of the fact whether the refund
claim is filed by the supplier or by the
Further, as the tax on the supply of goods,
regarded as deemed export, would be paid by
the supplier in his return, therefore, the
relevant date for purpose of filing of refund
claim for refund of tax paid on such supplies
would be the date of filing of return, related
to such supplies, by the supplier.
2. It is requested that suitable trade notices may be issued to publicize the contents of this Circular.
3. Difficulty, if any, in the implementation of this Circular may be brought to the notice of the Board. Hindi version will follow.
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