QUESTION
Dear sir we are manufature of ceramic tiles in which we used coal as a fuel.
we export 10% of our total sales with payment of IGST while we export 30% of our
total sales without payment of IGST (zero rated). can we claim 30% cess
(including 10% export with igst) as we export them? also in 3b of apr to jun
2019 in availeble ITC we reversed 70% of cess we received as we sale 70% of our
production in domestic as in ceramic there is no cess, and now at the time of
claiming refund we are allow to calim only 30% of remaining cess of that period
, while from july to mar 2020 as we didnt reversed our cess so we can claim 30%
cess of total recived cess, how can we claim the remaining cess for the period
of apr-jun that availble in our credit ledger?
ANSWER
Facts of the case:Manufacturer of ceramic tiles exports 30% of total sales without payment of
tax. In GSTR-3B he has reversed 70% of cess related to domestic sales, now how
to claim 30% cess related to export sales available in credit ledger.
Law Applicable:Section 11: Other provisions relating to cess.
(1) The provisions of the Central Goods and Services Tax Act, and the rules made
there under, including those relating to assessment, input tax credit, non-levy,
short-levy, interest, appeals, offences and penalties, shall, as far as may be,
mutatis mutandis, apply, in relation to the levy and collection of the cess
leviable under section 8 on the intra-State supply of goods and services, as
they apply in relation to the levy and collection of central tax on such
intra-State supplies under the said Act or the rules made there under.
(2) The provisions of the Integrated Goods and Services Tax Act, and the rules
made there under, including those relating to assessment, input tax credit,
non-levy, short-levy, interest, appeals, offences and penalties, shall, mutatis
mutandis, apply in relation to the levy and collection of the cess leviable
under section 8 on the inter-State supply of goods and services, as they apply
in relation to the levy and collection of integrated tax on such inter-State
supplies under the said Act or the rules made there under:
CGST RULE 89
(4) In the case of zero-rated supply of goods or services or both without
payment of tax under bond or letter of undertaking in accordance with the
provisions of sub-section (3) of section 16 of the Integrated Goods and
Services Tax Act, 2017 (13 of 2017), refund of input tax credit shall be granted
as per the following formula -
Refund Amount = (Turnover of zero-rated supply of goods + Turnover of zero-rated
supply of services) x Net ITC ''Adjusted Total Turnover
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Interpretation:In our opinion you can take refund on pro rata basis as per formula given in
rule 89 of CGST Rules because as per policy the goods and/or services are to be
exported but not the taxes since cess is also a kind of tax so it should not be
exported by including it in the value of goods
Section 11 as reproduced above give this facility that all the provisions of
IGST /CGST Act and rules made there under including those relating to assessment,
input tax credit, non-levy, short-levy, interest, appeals, offences and
penalties, shall, mutatis mutandis, apply in relation to the levy and collection
of the cess leviable.
Conclusion:You can take refund of cess available in credit ledger relate to export sales as
per Rule 89(Reply dt.12-05-2020)