FAQ– Having an issue in getting a refund of IGST for shipping bills due to mismatch in GSTR-1 and GSTR-3B or have wrongly declared the payment of IGST on export in the wrong table/column in GSTR-3B?

Filing of Certificate is Mandatory for IGST refund on exports

 

Solution

It is a very common issue in cases of export of goods or services, that refund of IGST is pending and not processing due to the reason of mismatch of data between GSTR-1 and GSTR- 3B and therefore the data is not being able to be transmitted to custom EDI system.

The reason behind the above mismatch is happening due to the reason that many have committed mistakes while filing GSTR-1 and GSTR-3B where the exporters have inadvertently misdeclared IGST paid on export supplies as IGST paid on interstate domestic outward supplies while filing GSTR-3B. The exporters have also in certain cases short-paid IGST vis-à-vis their liability declared in GSTR1. Therefore, the transmission of data from GSTN to Customs EDI system is hindering which is causing the obstacle in sanction of refund of IGST paid on exports.

The solution for the same was provided by the department vide Circular no. 12/2018-Customs dated 29-05-2018. as follows:

 

A. WHEN THERE IS NO SHORT PAYMENT OF IGST THAN REFUND CLAIMED

1. The Refund shall be sanctioned/processed

2. Mandatory filing of a certificate from a Chartered Accountant was made showing that there is no discrepancy in the IGST refunded and the IGST paid on exports

3. Non-filing of Certificate from CA will affect any future IGST refunds

B. WHEN THERE IS SHORT PAYMENT IGST THAN REFUND CLAIMED

1. The exporter shall be communicated for such short payment

2. Payment has to be made for such shortfall and proof to be submitted to Assistant/Deputy Commissioner of Customs- self-certified copy of challan

3. If the IGST Refund is more than Rs. 10 lacs, also a certificate from a Chartered Accountant is required to be submitted for repayment of a shortfall.

4. Submission of Undertaking is also required for a refund if not due to him.

5. Thereafter, the Refund shall be sanctioned/processed

6. Mandatory filing of a certificate from a Chartered Accountant was made showing that there is no discrepancy in the IGST refunded and the IGST paid on exports

7. Nonfiling of Certificate from CA will affect any future IGST refunds.

The above system has also been extended w.r.t. shipping bills for the period 01-04-2019 to 31-03-2021vide Circular No. 04/2021- Customs dated 16-02-2021.

 

The filing of a certificate from a Chartered Accountant is compulsory now and the last date submission for shipping bills w.r.t. 01-04-2019 to 31-03-2020 is 31-03-2021 and w.r.t. 01-04-2020 to 31-03-2021 is 31-10-2021.

 

Also, there shall be post refund Audit by DG (Audit) who shall include these refund records for conducting Audit under the GST law and appropriate action may be taken for any discrepancies.