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Clarification -Whether changes in refund for inverted duty structure formula applied retrospectively or prospectively ….

As you know I have already explained changes in inverted duty structure formula in my previous article now readers wanted to know answers to three questions related to my previous article—

Question 1-

Whether changes in formula for refund for inverted duty structure can be applied for previous tax periods also….

According to my view – Yes ,  Change in formula for refund for inverted duty structure applied for previous tax period also.. Changes in made in Rule 89(5) vide notification no 14/2022 dated 05.07.2022 in which now refund for input services also allowed proportionately can be applied for application for refund for previous tax periods also as we all know changes were introduced in formula to remove anomalies in formula so how can refund be denied for previous tax periods.

Refund can be applied after 05.07.2022 even though related to previous tax periods as per new formula stated in notification.

Question 2-

What about applications for refund pending before 05.07.2022 ?? 

According to my view , they cannot re-apply refund as per new formula but this matter can be litigated as changes were introduced to remove anomalies in formula so differential amount due to change in formula w.e.f 01.07.2017 can be demanded as refund and litigated also. 

Question 3-

What about applications for refund for future tax periods …. 

According to my view- All applications for refund related to inverted duty structure after 05.07.2022 will be applied as per new formula stated in notification no 14/2022 dated 05.07.2022

Any queries related to refunds can be mailed at mamta0581@gmail.com

 

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One Comment

  1. JATIN says:

    SYSTEM HAS NOT BEEN UPDATED FOR NEW FROMULA. TILL THE DATE WE ARE UNABLE TO FILE REFUND WITH NEW CALCULATIONS. WHEN WILL PORTAL ACCEPT REFUND WITH NEW FORMULA.

    Net input tax credit
    (4) (₹)

    Edit the Net ITC to exclude, the ITC availed on input services and capital goods and the ITC of refund claimed under Rule 89(4A) and/ or (4B)
    Maximum refund amount to be claimed (5) [(1×4÷3)-2] (₹)

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