QUESTION
Refund Blocked as Export (With Payment of Tax) Declared under Normal Outward Taxable Supplies in GSTR-3B. Export (With Payment of Tax) for the period September-20 & October-20, Declared under 3.1 (a) in GSTR-3B instead of 3.1 (b). The above Supplies has been declared Correct in Table 6A- Export Invoices in GSTR-1. As there is mismatch in GSTR-3B and GSTR-1 refund has not been issued through Icegate and also blocked for the period September-20 to till Date. Also the Outward taxable supplies (other than zero rated, nil rated and exempted) is NIL for the month of January-2021 and also in future period. Now what are the possible solutions to make the necessary rectification to get the Refund for Export Sales made with payment of Tax which were not declared as Exports in GSTR-3B?
ANSWER
Facts of the case: Refund
for the period September-20 to till Date has been Blocked as Export (With
Payment of Tax) Declared under Normal Outward Taxable Supplies in GSTR-3B i.e.
Declared under 3.1 (a) in GSTR-3B instead of 3.1 (b). The above Supplies has
been declared Correctly in Table 6A- Export Invoices in GSTR-1. As there is
mismatch in GSTR-3B and GSTR-1 refund has not been issued through Icegate. Also
the Outward taxable supplies (other than zero rated, nil rated and exempted) is
NIL for the month of January-2021 and also in future period.
Interpretation: In case of Exports with payment of tax, for claiming refund details are declared in GSTR-1 under Table ‘6A – Exports Invoices’. The details entered in Form GSTR-1 will be matched with the details mentioned in the shipping bill.
Further, GST refund process for exports will involve declaration in GSTR 3B too in Table 3.1(b)- ‘Outward taxable supplies (zero-rated)’.
The details as filed in the GST returns would be transmitted electronically by the GST common portal to the system designated by the Customs. The IGST refund would not be processed if there is any validation error i.e. details in GST Returns are not filled properly in respective columns or if there is mismatch in GSTR-1 and GSTR-3B.
In the given case rectification in GSTR-3B is also not possible as in your case Outward taxable supplies (other than zero rated, nil rated and exempted) is NIL for the month of January-2021 and also in future period.
Refund can't be rejected on the technical ground
or for clerical lapses. It is also clarified vide Circular No 37/11/18 GST
that refunds may not be withheld due to minor procedural lapses or
non-substantive errors or omission.
Similar decision was given by Delhi
Tribunal in case of KANSAL KNITWEARS Versus COMMISSIONER OF C. EX.,
CHANDIGARH [2000(09)LCX113].
Conclusion: Refund can't be rejected on the technical ground or for clerical lapses. Thus you can file an Appeal to Appellate Authority u/s 107 of CGST Act (Reply dt. 06/02/2021)