Question

One of my client is running a cheritable Dialisis centre in GUJARAT & having regestration with sec.12 AA with INCOME TAX ACT & also with GST ACT.Now my query is 1) As per GST act we are covered under HEALTH CARE SERVICE Which is EXEMPETED as per Notification no:12 Now; We are purchasing Medicines & other Dialisis Matriel like bloodline tubing set, Needal,N.S bottle etc. from GST REGESTERED SUPPLIARS with seprately GST charged so our service is exempeted then whether we are elligeble for REFUND on payment of GST on Purchase? 2) We are also regestered with MAA AMRUTUM YOJANA of GUJARAT STATE In which Gujarat govt.Reimburse Rs.2300/- per Person who is taking treatment in our centre & also in case of Higherer expenses our trust is bare the balance amount. Further we are not raise or issuing any bill or voucher to Patient.We are not taking any SERVICE CHARGE OR PRICE OF MEDICINES & OTHER DIALISIS MATRIEL PROVIDE TO Patient.In that case whether we are elligible for REFUND on purchase of Medicines.

Answer

The refund under Section 54 of the CGST Act, 2017 is available in following cases
(i) zero rated supplies made without payment of tax;
(ii) 'where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council:

Considering above legal provisions point wise reply to your question is as follow
Point no one :-
The refund under section 54 of the CGST Act, 2017 under Inverted tax structure of ITC is available when the rate of tax on output supply is less than the rate of tax on input supply. The refund will be available only when the ITC is eligible. In your case you can not take credit as per section-17 of CGST Act, 2017 because you are not doing taxable supply. If the credit is blocked then question of refund of ITC is not available because there is no balance in ITC account.

Point no two :-
You are getting subsidy from the government. As per Section-15 of the CGST Act, 2017 subsidy from the government is not to be added in the value. Even if the subsidy is received from any other source/private subsidy then the supply is still exempted from tax. Accordingly credit will not be allowed and there is no possibility of refund of credit.Because there is no accumulated balance of ITC (Reply dt.05/02/2019)