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There is no doubt that the apex authority to supervise and resolve various issues with regard to Goods & Service Tax, i.e. the GST council has always drafted and duly implemented all the necessary socialist reforms in their regular meetings. Moreover, the GST laws have been recurrently amended or modified so as to make them more favorable for different sectors of the economy.

Very importantly, various provisions under the Central Goods and Services Tax, 2017 India have been so far amended repeatedly in the previous GST council meetings, as to make them more user-friendly.

In this context, the Central Board of Indirect taxes and Customs (CBIC) on 9th of October 2018 had officially announced the Central Goods and Services Tax (12th Amendment) Rules, 2018 vide the Notification 54/2018 under the head ‘Central Tax’. This amendment has been made in respect of IGST refund claims of the exporters who have GST registration.

#1. What is the objective of the 12th Amendment of CGST Rules 2017?

  • As per the CGST (12th Amendment) Rules-2018, the GST department has substituted the Rule 96(10) and Rule 89(4B) prospectively (i.e. with effect from the date of notification).
  • The sole objective of these amendments is to allow the claim of IGST refund by the exporters who have GST registration and have got capital goods under the Export Promotion Capital Goods (EPCG) scheme.

#2. Why have CGST Rule 96(10) and 89(4B) amended?

As discussed above, the main idea behind the CGST (12th Amendment) Rules-2018 is to facilitate easier claim of IGST refunds. In this regard,

  • The CGST Rule 96(10) has been amended to allow the exporters to claim refund of the IGST paid on exports of capital goods that they have got under the EPCG scheme.
  • The CGST Rule 89(4B) has been amended to align it and make it more consistent with the recently amended CGST Rule 96(10).

#3. How has CGST Rule 89(4B) been amended?

The department has introduced the amendment in the CGST Rule 89(4B), wherein the exporter having GST registration and carrying out export with the unique Import Export Code can claim his refund in the following case-

  • If he has unutilized input credit on account of 0-rated supplies without IGST payment in respect of the supplies on which the exporter has availed the benefit of exemption from-
  1. CGST payment on intrastate supply of goods or
  2. IGST payment on interstate supply of goods.

#4. What amendment has been made to CGST Rule 96(10)?

The GST department has also made the amendment in the CGST Rule 96(10), wherein the exporter having GST registration and conducting export with the Import Export Code registration can claim his refund in the following cases-

  1. If he has paid IGST on supplies except those goods that have listed under category of ‘Deemed Exports’
  2. However, the amendment will allow exporter to claim the input credit in case he has got his supplies under the Export Promotion Capital Goods (EPCG) scheme.

Surely, these amendments will make the GST refund process more smooth and hassle-free for the exporters and in turn, will boost export promotion in India.

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May 2024