Provision of rule 89(4) of CGST Rules inapplicable to refund of integrated tax paid on zero-rated supply

Ohmi Industries Asia Private Limited Vs Assistant Commissioner (Delhi High Court)

Delhi High Court held that rule 89(4) of the Central Goods and Services Tax Rules, 2017 applies only in case of zero rated supply of goods or services, without payment of tax under bond or letter of undertaking. Accordingly, provisions are inapplicable to cases of refund of integrated tax paid on zero rated supply.

Facts- The petitioner had filed an application seeking refund of an amount being the integrated tax paid on the export of services (zero rated supply) in respect of the invoices raised in the month of October 2018. The petitioner had received the Foreign Inward Remittance against the said invoices in November.

The Adjudicating Authority issued a Show Cause Notice setting out certain queries with regard to the difference in the payment of tax, and as reflected in ‘Annexure B’. The Adjudicating Authority also raised a query on the ground that the Input Tax Credit shown in respect of four invoices was not reflected in the corresponding GSTR 2A of August, 2018 to October, 2018 filed by the petitioner.

The Adjudicating Authority rejected the petitioner’s claim for refund of integrated tax.

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