CBEC issues Circular on Refund of IGST on Export - Invoice mis-match Cases and Alternative Mechanism with Officer Interface

Mar 05, 2018 | by Avantis RegTech Legal Research Team

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General Compliance

The Central Board of Excise and Customs (CBEC) has received numerous representations from exporters / trade associations seeking resolution of various problems which have hindered the sanction of refund of IGST paid on exports. The CBEC has issued Circular No 42 / 2017 dated November 07, 2017 which highlighted the common errors that hindered the sanction and disbursal of refund of IGST paid against exports. Subsequent to the said Circular, outreach programmes have been undertaken and advisories, advertisements and FAQs have been issued to create awareness amongst the exporter community regarding the common mistakes and errors which hold up the refund process. Information is being made available to exporters on a real-time basis with regard to the errors status on ICEGATE website for registered users. Details of refund sanctioned is being sent through SMS on registered mobile phones. A positive gain of these efforts has been that errors are steadily decreasing, which has enabled CBEC to sanction more than Rs. 4000 crores of refund, so far. The matter is being closely coordinated with GSTN, which has also been tasked to provide feedback to the exporter about any failed validations to enable corrective action on their part.

The analysis of data post October 2017 indicates that while the quantum of errors is decreasing significantly, exporters are still committing mistakes in the information furnished to

(i)          GSTN while filing GSTR 1 / Table 6A or GSTR 3B and

(ii)        Customs EDI system while filing Shipping Bill.

The pre-requisites and precautions that need to be taken for successful processing of refund claims are as given in the Circular.

The CBEC, recognizing that invoice mis-match has been the major reason why the refunds have been held, has decided to provide an alternative mechanism to give exporters an opportunity to rectify such errors committed in the initial stages. This envisages an officer interface on the Customs EDI System through which a Customs officer can verify the information furnished in GSTN and Customs EDI system and sanction refund in those cases where invoice details provided in GSTR 1/ Table 6A are correct though the said details provided in the shipping bill were at variance. It is pertinent to note that refund claims would be processed in only those cases where the error code is mentioned as SB005. Further, it may also be noted that all refunds shall continue to be credited electronically through the PFMS system, and no manual payment / cheque should be issued. The procedure for processing of IGST refund claims in these cases is given in the Circular. This procedure is available only for Shipping Bills filed till December 31, 2017.

[Circular No. 05/2018-Customs]

URL: http://www.cbec.gov.in/htdocs-cbec/customs/cs-circulars/cs-circulars-2018/circ05-2018cs.pdf


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