GST Refunds Technical glitches need immediate attention

Apr 08, 2020 by Pritam Mahure in GST Compliances

Table of Contents

1.1 Why GST refunds issues need attention?

Export sales are already heavily impacted and will continue to be impacted in coming months
Even receivable for services/goods already supplied may not be received in coming months
As exporters continue to incur costs such as salaries, interest, etc, they are facing a severe cash crunch

Error

• Refunds are stuck on account of inadvertent errors

System Glitches

• Refunds are stuck of on account of system glitches

In many cases, refunds are stuck of on account of inadvertent errors or system glitches
Further, no standard solution is available for such errors/ glitches
In certain cases, although Circular/ clarification is available still the same is not found as useful
It has been experienced by exporters that substantial time needs to be invested to receive such stuck refunds
Such cases can be split into two basket: i.e. 1. Export with payment of GST 2. Export without payment of GST as discussed in ensuing slides

1. Invoice (commercial and/or GST Invoice) is prepared)

2. E-way bill is generated (for goods)

3. Shipping Bill with details of invoice is prepared

4. GSTR-1 is prepared (with details captured in table no. 6A)

5. GSTR-3B is prepared (with details captured in table no. 3.1 column b)

There are instances wherein refunds are not getting processed due to discrepancies in GSTR 1 (Table 6A) vis-à-vis GSTR 3B vis-à-vis Customs EDI system
Even Circular No. 05/2018-Customs highlighted that only 32% records of GSTR-1 are getting transferred
Circular No. 37/11/2018-GST also clarified that the detail of invoices/Shipping Bill/Bill of Export can be amended without mentioning the earlier period up to which it can be amended

3.3 Issue and way forward

Shipping bill can be amended for earlier years however details of invoices like date, number, etc. is not allowed to be amended after return of September of subsequent year
Additionally, system restricts amendment of invoice only once. Thus, even in case of mismatches due to ‘-’, date etc. refunds are pending for more than two years
Given this, appropriate resolution to these issues should be provided at the earliest