GST refund can be claimed under various grounds by the exporters/taxpayers on ground of excess amount if they have paid more than the GST liability.

Refund can be claimed on below mentioned grounds:

  • Refund of unutilized input tax credit (ITC) on account of exports without payment of tax;
  • Refund of tax paid on export of services with payment of tax;
  • Refund of unutilized ITC on account of supplies made to SEZ Unit/SEZ Developer without payment of tax;
  • Refund of tax paid on supplies made to SEZ Unit/SEZ Developer with payment of tax;
  • Refund of unutilized ITC on account of accumulation due to inverted tax structure;
  • Refund of excess balance in the electronic cash ledger;
  • Refund of excess payment of tax;

GST Refund procedure and limitations

Procedure for refund:

  • Submit GST RFD 01 along with the documentation listed in Annexure 1 i.e.

1. Statement-3

2. Declarations

3. BIRC/FIRC certificate

4. GSTR-2A

5. Annexure B working

  • The Application Reference Number (ARN) will be generated only after the applicant has completed the process of filing the refund application in FORM GST RFD-01.
  • The GST office will intimate via portal the show cause notice/deficiency memo within 15 days of the filing of application.
  • The time limit of 15 days to issue an acknowledgement or a deficiency memo, as the case may be, shall be counted from the date of ARN.
  • The acknowledgement (FORM GST RFD-02) for the complete application or deficiency memo (FORM GST RFD-03), as the case may be, would be issued electronically.
  • If the Proper Officer is prima facie satisfied, the Proper Officer may issue an order in GST RFD 04 authorising the amount payable within 7 days of the date of acknowledgement.
  • The Proper Officer shall issue a payment advise in form GST RFD 05 and pass an order for refund in GST RFD 06, following which the amount will be automatically credited to the registered person’s bank account.
  • The order must be issued within 60 days of receiving a complete application.
  • In the event of export supplies, the Act additionally provides for a provisional repayment of 90% of the refund claim within 7 days of the date of acknowledgement if the provider was not prosecuted in the five years preceding the refund period.

Deficiency Memos 

  • A Deficiency Memo shall be issued within 15 days from the date of generation of ARN.
  • Once an acknowledgement has been issued in relation to a refund application, no deficiency memo, on any ground, may be subsequently issued for the said application.
  • A fresh application would be filed after correction/rectification of deficiencies as pointed out.
  • Once an application has been submitted afresh, pursuant to a deficiency memo, the proper officer will not serve another deficiency memo with respect to the application for the same period, unless the deficiencies pointed out in the original deficiency memo remain un-rectified, either wholly or partly, or any other substantive deficiency is noticed subsequently.

Duration of Refund Claim:

The time restriction for requesting a refund is two years from the date of the incident. In each situation, the applicable date is different. Also if refund is paid with delay an interest of 24% p.a. is payable by the government.

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Qualification: CA in Practice
Location: Delhi, Delhi, India
Member Since: 16 Sep 2021 | Total Posts: 1

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  1. vswami says:

    In re. AJE India..The cited case has been reported @
    Look up within for the TXT of the HC Judgment.

    The term, ‘ may’ has been interpreted /construed having regard to the factual matrix of that case. Without confining oneself to the cited case, on the Flip Side , however, it needs to be borne in mind that, -as repeatedly held by courts,- the proposition whether the term ‘may’ has to be construed to mean and entail ‘discretion’ in all cases, or could it be construed to mean ‘shall’ having regard to the peculiar facts in a given case !

    Further, – it needs to be equally borne in mind, according to a well reasoned thinking,and eminent expert /upright view, the scope for ‘discretion’ in general, uniformly in all such or similar matters, might have the unintended consequence of damaging the societal welfare/impacting the ethical and moral behaviour of the officers vested with an unlimited /uncontrolled discretionary powers !

    OVER /Back to for …….

  2. opjain02 says:

    Time limit for submission of Claim ─1. The use of the word “may” in S.54(1), CGST Act, 2017, denotes discretion as per case of AJE India Pvt. Ltd. v. Union of India & Ors. (Bom) (2021) 35 J.K.jain’s GST & VR 319. As such the Refund claims submitted after 2 years are also valid.
    2. Kindly elaborate the phrase “Relevant date” in S.54(1).
    CA Om Prakash Jain s/o J.K.Jain, Jaipur.

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October 2021