CBIC has clarified certain issues vide CBIC Circular No. 137/07/2020-GST dt. 13.04.2020, which is briefed as below:

1. In case where an advance is received by supplier for a Service contract which subsequently got cancelled. The supplier has issued Tax Invoice before supply of service and paid the GST thereon. Whether he can claim refund of tax paid or is he required to adjust his tax liability in his returns?

The supplier is required to issue a “credit note” and declare the details of such credit notes in the return to adjust the tax liability.

However, in cases where there is no output liability against which a credit note can be adjusted, registered persons may proceed to file a claim under “Excess payment of tax, if any” through FORM GST RFD-01. 

2. In case an advance is received by supplier for a Service contract, which got cancelled subsequently. The supplier has issued receipt voucher and paid the GST on such advance received. Whether he can claim refund of tax paid on advance or he is required to adjust his tax liability in his returns?

The supplier is required to issue a “refund voucherand apply for refund of GST paid on such advances by filing FORM GST RFD-01 under the category “Refund of excess payment of tax”.

3. In case where goods supplied by a supplier under cover of a tax invoice are returned by the recipient. Whether he can claim refund of tax paid or is he required to adjust his tax liability in his returns?

The supplier is required to issue a “credit note” and declare the details of such credit notes in the return to adjust the tax liability.

However, in cases where there is no output liability against which a credit note can be adjusted, registered persons may proceed to file a claim under “Excess payment of tax, if any” through FORM GST RFD-01.

 4. Letter of Undertaking (LUT) issued for the year 2019-20 has expired on 31.03.2020. Whether a registered person can still make zero-rated supply on such LUT and claim refund accordingly or does he have to make such supplies on payment of IGST and claim refund of such IGST?

The time limit for filing of LUT for the year 2020-21 shall stand extended to 30.06.2020 and the taxpayer can continue to make the supply without payment of tax under LUT, provided that LUT for year 2020-21 is furnished on or before 30.06.2020. Taxpayers may continue to quote the reference no of the LUT for the year 2019-20 in the relevant documents.

5. While making the payment to recipient, amount equivalent to 2% was deducted i.e. Tax Deducted at Source (GST-TDS). Whether the date of deposit of such payment has also been extended vide notification N. 35/2020-CT dated 03.04.2020?

Yes, the due date for furnishing of return in FORM GSTR-7 along with deposit of TDS has also been extended till 30.06.2020 and no interest under shall be leviable, if tax deducted is deposited by 30.06.2020.

6. If in a particular case, due date for making an application for refund expires on 31.03.2020, can such person make an application for refund before 29.06.2020 vide notification N. 35/2020-CT dated 03.04.2020 ?

The due date for filing an application for refund has also been extended till 30.06.2020.

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One Comment

  1. Sakil Khan says:

    Sir, I have taken investment advisory service from a firm which was sold to me by unfair means.when I complained to SEBI the firm agreed to refund the amount deducting tha GST paid along with. So please let me know is this genuine or I am eligible to get the gst refund also.or I have to claim the gst refund on my own.

    Thank you.

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