CBIC Notification: Eligible Registered Persons for IGST Route Refunds

CBIC notifies supplies and class of registered person eligible for refund under IGST Route vide Notification No. 05/2023 – Integrated Tax Dated : 26th October, 2023.

Introduction

The Ministry of Finance, under the Department of Revenue, has issued Notification No. 05/2023 – Integrated Tax on October 26, 2023. This notification brings significant changes to the Integrated Goods and Services Tax Act, 2017, impacting the export of goods and services and the refund of taxes paid. In this article, we will delve into the details of these amendments and their implications.

Amendment Highlights This notification revises the earlier notification (No. 01/2023-Integrated Tax) dated July 31, 2023, with effect from October 1, 2023. The key amendments are as follows:

1. Export of Goods or Services The notification defines the class of goods or services that may be exported with the payment of integrated tax. Importantly, it also addresses the eligibility of suppliers to claim a refund on the tax paid for these exports.

2. Special Economic Zones (SEZs) The notification specifically mentions suppliers to Developers or units within Special Economic Zones. These suppliers are authorized to make supply of goods or services in SEZs on payment of integrated tax and are eligible to claim refunds on the tax paid.

Explanation of Terms To clarify these amendments, the notification provides explanations for certain terms:

• “Authorized operations” is defined in alignment with Section 2(c) of the Special Economic Zone Act, 2005.
• “Developer” is explained in line with Section 2(g) of the Special Economic Zone Act, 2005.
• “Special Economic Zone” is defined as per Section 2(za) of the Special Economic Zone Act, 2005.
• “Unit” is explained based on the definition in Section 2(zc) of the Special Economic Zone Act, 2005.

Effective Date The notification is effective from October 1, 2023, upon its publication in the Official Gazette.

Conclusion

The Ministry of Finance’s latest notification, No. 05/2023 – Integrated Tax, is a significant development in the realm of taxation related to the export of goods and services. It introduces changes in the tax treatment of exported goods and services and specifies the eligibility of suppliers within Special Economic Zones to claim refunds on integrated tax. These amendments aim to streamline and clarify the tax framework for exports and promote economic activities within Special Economic Zones. It’s essential for businesses involved in these activities to stay updated with these changes and ensure compliance with the amended regulations.

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS)

Notification No. 05/2023 – Integrated Tax | Dated : 26th October, 2023

G.S.R. 797(E).— In exercise of the powers conferred by sub-section (4) of section 16 of Integrated Goods and Services Tax Act, 2017 (13 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 01/2023-Integrated Tax, dated the 31^st July, 2023, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i),vide number G.S.R. 578 (E), dated the 31^st July, 2023, namely:-

In the said notification, for the portion commencing with the words “all goods or services” and ending with the words “the refund of tax so paid:”, the following shall be substituted and shall be deemed to have been substituted with effect from the 1^st day of October, 2023, namely:—

“(i) all goods or services (except the goods specified in column (3) of the TABLE below) as the class of goods or services which may be exported on payment of integrated tax and on which the supplier of such goods or services may claim the refund of tax so paid; and

(ii) all suppliers to a Developer or a unit in Special Economic Zone undertaking authorised operations as the class of persons who may make supply of goods or services (except the goods specified in column (3) of the TABLE below) to such Developer or a unit in Special Economic Zone for authorised operations on payment of integrated tax and on which the said suppliers may claim the refund of tax so paid:

Explanation,.– For the purpose of this clause:—

(i) the term “authorised operations” shall have the same meaning as defined in clause (c) of Section 2 of the Special Economic Zone Act, 2005 (28 of 2005),

(ii) the term “Developer” shall have the same meaning as defined in clause (g) of Section 2 of the Special Economic Zone Act, 2005 (28 of 2005),

(iii) the term “Special Economic Zone” shall have the same meaning as defined in clause (za) of Section 2 of the Special Economic Zone Act, 2005 (28 of 2005),

(iv) the term “unit” shall have the same meaning as defined in clause (zc) of Section 2 of the Special Economic Zone Act, 2005 (28 of 2005).

2. This notification shall come into force on the date of its publication in the Official Gazette.

[F. No. CBIC-20001/10/2023-GST]
RAGHAVENDRA PAL SINGH, Director

Note: The principal notification No. 01/2023- Integrated Tax, dated the 31^st July, 2023, was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 578(E), dated the 31^st July, 2023.