Only those goods which are actually subjected to export duty i.e., on which some export duty has to be paid at the time of export, will be covered under the restriction imposed under section 54(3) from availment of refund of accumulated ITC.
Section 54 of the CGST Act, 2017— Refund — The petitioner earlier challenged two instructions dated 8th June and 25th June 2021 issued by the respondent requiring to deal with refund of unutilized ITC against export on the basis that where the export duty is at NIL rate and not exempted. Now besides thi, the petitioner challenged SCN dated 21st July 2021 pertaining to the three months i.e. April, May and June, 2020. The court observed that the GST Council at its 45th Meeting on 17th September 2021 decided inter alia to issue a clarification in respect of goods for which the export duty is in fact not paid. It was clarified that “only those goods which are actually subjected to export duty i.e., on which some export duty has to be paid at the time of export, will be covered under the restriction imposed under section 54 (3) of the Act, 2017. A fresh circular dated 20th September 2021 has been issued by the CBIC, in this regard. The respondent counsel submitted that if a direction is given for time bound disposal of the refund application, it will be complied with. The court observed that since the instruction dated 25th June 2021 stands withdrawn, clearly the earlier instruction dated 8th June 2021 which is in the same vein also does not survive. The impugned SCN has been issued only as result of the above circulars, it also does not survive.
Held that:- The Hon’ble High Court set aside the SCN and directed opposite parties to reprocess the refund application of the Petitioner in light of the fresh circular issued on 20th September 2021 and convey the decision to the Petitioner thereon not later than 7th February, 2022.
Only those goods which are actually subjected to export duty i.e., on which some export duty has to be paid at the time of export, will be covered under the restriction imposed under section 54(3) from availment of refund of accumulated ITC.
Section 54 of the CGST Act, 2017— Refund — The petitioner earlier challenged two instructions dated 8th June and 25th June 2021 issued by the respondent requiring to deal with refund of unutilized ITC against export on the basis that where the export duty is at NIL rate and not exempted. Now besides thi, the petitioner challenged SCN dated 21st July 2021 pertaining to the three months i.e. April, May and June, 2020. The court observed that the GST Council at its 45th Meeting on 17th September 2021 decided inter alia to issue a clarification in respect of goods for which the export duty is in fact not paid. It was clarified that “only those goods which are actually subjected to export duty i.e., on which some export duty has to be paid at the time of export, will be covered under the restriction imposed under section 54 (3) of the Act, 2017. A fresh circular dated 20th September 2021 has been issued by the CBIC, in this regard. The respondent counsel submitted that if a direction is given for time bound disposal of the refund application, it will be complied with. The court observed that since the instruction dated 25th June 2021 stands withdrawn, clearly the earlier instruction dated 8th June 2021 which is in the same vein also does not survive. The impugned SCN has been issued only as result of the above circulars, it also does not survive.
Held that:- The Hon’ble High Court set aside the SCN and directed opposite parties to reprocess the refund application of the Petitioner in light of the fresh circular issued on 20th September 2021 and convey the decision to the Petitioner thereon not later than 7th February, 2022.