Para 14.2.13 — CAM
Original Rule Text
14.2.13 REFUNDS UNDER GST
14.2.13.1 Refund of GST may occur due to various reasons viz.
Refund of IGST paid on Goods exported out of India Refund arising due to supply of zero rated Goods and Services Refunds due to inverted duty structure Refund due to deemed exports Refund of GST paid by Unique Identification Number (UIN) entities like Embassies, UN agencies etc.
14.2.13.2 PROCESS OF REFUND OF IGST PAID BY EXPORTERS ON GOODS EXPORTED OUT OF INDIA
a) In accordance with Rule 96 of CGST Rules, the shipping bill filed by an exporter of goods shall be deemed to be an application for refund of integrated tax (IGST) paid on the goods exported out of India. The application is deemed to have been filed only when the Export General Manifest (EGM) has been generated and the GSTR3B has been filed by the tax payer.
b) On receipt of the information of valid return filing of GSTR 3B and GSTR1 from the common portal (GSTN), the designated officer of Customs processes the claim and sanction the refund in the ICES/ICEGATE System. He also generates a sanction file for IGST Refunds.
c) The IGST sanction file contains a list of beneficiaries for whom the IGST Refunds has been sanctioned by the officer. This data is sent by the ICEGATE system to the PFMS system in specified file format.
d) The PFMS system validates the file and places it at the DDO level. An officer of Customs department designated as the DDO generates the bill in PFMS for these sanctions received at his level, digitally signs and sends it to the PAO [ e-PAO GST Refunds Mumbai].
e) The e-Pay and Accounts Officer receives the e-refund bills, and the same are cleared in PFMS at three levels viz. Dealing Hand, AAO and Pay and Accounts Officer. The Pay and Accounts Officer digitally signs the payment file for disbursement to the beneficiaries through the authorized bank of CBIC.
14.2.13.3 GST REFUND DISBURSEMENT THROUGH SINGLE AUTHORITY
(A)
(i) Under GST the tax payers are either under the Jurisdiction of the Centre Tax authority (CBIC) or the State Tax authority. The refund shall be sanctioned by the Tax authorities either under CGST/IGST/CESS/SGST(UTGST) or under all or combination of the tax heads irrespective of whether the tax payer is under Centre or State’s jurisdiction. During manual process of these sanctions the refund sanctions were passed to the respective pay and accounting authorities through the nodal officers for disbursement.
What This Means
GST refunds occur for various reasons — exports, zero-rated supplies, inverted duty structure, deemed exports, and purchases by diplomatic entities. For exporters, the shipping bill serves as the refund application. The refund process flows from GSTN (application) to Customs/Tax Officer (sanction) to PFMS (bill processing) to e-PAO (payment). Under the Single Authority system, all GST refunds (including SGST) are disbursed by the Centre, with SGST refund amounts recovered from States during IGST settlement. The entire process is automated through GSTN-PFMS integration.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1GST refunds arise from exports, zero-rated supplies, inverted duty structure, deemed exports, and UIN entity purchases
- 2For exports, shipping bill is deemed refund application — processed after EGM and GSTR3B are filed
- 3Single Authority: All GST refunds (including SGST/UTGST) disbursed by Centre; SGST recovered during IGST settlement
- 4Fully automated: GSTN validates bank details through PFMS, then pushes payment files to DDO and e-PAO
- 5Accounting: Revenue heads debited (or 8658.00.140 for State refunds), with bank scroll reconciliation
Practical Example
An exporter in Chennai ships goods worth Rs 1 crore to the US after paying IGST of Rs 18 lakh. The shipping bill filed at Customs is treated as the refund application. After the Export General Manifest is generated and GSTR-3B is filed, GSTN validates the exporter's bank details through PFMS. The Customs officer sanctions the refund, which flows electronically to the DDO at ICEGATE, then to the e-PAO (GST Refunds Mumbai), who digitally signs the payment for direct credit to the exporter's bank account.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What is the Single Authority system for GST refunds?▼
How are exporter bank details validated?▼
What types of GST refunds exist?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.