GST Update on recommendations of gst council on refund procedure part-13

This update seeks to discuss the recommendations made by GST council in its 31st meeting held on 22nd December, 2018 with respect to refund procedure prevalent as on date. One of the major decision taken with respect to refund is the introduction of scheme of single authority for disbursement of the refund amount sanctioned by either the Centre or the State tax authorities that is proposed to be implemented on pilot basis. It is pertinent to mention that the delay and problem faced by the assessees due to separate procedure for disbursement of refund by Central and State authorities was represented by us and has been partially considered by the GST Council. In order to explain the proposed scheme for disbursement of refund, it is better to have a look at the present procedure of disbursement of refund by the revenue authorities.
To begin with, at present, the actual disbursement of refund takes a very long time, leading to blocking of working capital of the assesses which acts as a big hindrance in their smooth functioning. It is submitted that apart from refund sanctioning officers, the Payment Officers are appointed for multiple Commissionerates. The amount of refund to be sanctioned to the assessee is sent via draft to the Payment Officer who then approves the refund amount and thereafter refund is disbursed to the assessee via RTGS. Similarly, in cases of refund of SGST, the refund draft is sent to the treasury and after approval, the refund is sanctioned to the assessee via RTGS. In nutshell, the refund sanctioning authority is different from refund disbursement authority, that too, separate for the Centre and State. However, the representation was made to the council to appoint a single authority for disbursement of refund (for Centre and State both) which will lead to speedy disbursal of refund claims filed by assessee. It was accepted by the GST council. However, it was also represented that the refund sanctioning authority and disbursement authority should also be merged. But this matter has not been accepted by the GST council. Now long duration taken in sanction of refund will be lowered but still the sanctioning authority cannot disburse the refund, hence time will still be taken in getting money by exporter.
Furthermore, as GST seeks to function online with less paperwork, it is also proposed that all the supporting documents/invoices in relation to a claim for refund in FORM GST RFD-01A will be uploaded electronically on the common portal at the time of filing of the refund application itself. Hence, there will be no requirement for the taxpayer to visit a tax office for submission of a refund application. This feature will shortly be enabled on the common portal and is appreciated by the assessees. However, uploading of invoices which are not appearing in GSTR-2A will be difficult task.
In continuation to the above, the following types of refunds shall also be made available through FORM GST RFD-01A:
• Refund on account of assessment/Provisional Assessment/Appeal/Any other order;
• Tax paid on an intra-State supply which is subsequently held to be inter-State supply and vice-versa;
• Excess payment of Tax; and
• Any other refund.
It is also clarified that in case of applications for refund in FORM GST RFD-01A (except those relating to refund of excess balance in the cash ledger)which are generated on the common portal before the roll out of the functionality described above, and which have not been submitted in the jurisdictional tax office within 60 days of the generation of ARN, the claimants shall be sent communications on their registered email ids containing information on where to submit the said refund applications. If the applications are not submitted within 15 days of the date of the email, the said refund applications shall be summarily rejected, and the debited amount, if any, shall be re-credited to the electronic credit ledger of the claimant.
It appears that the government seeks to streamline the procedure of sanction of refund so that there is speedy disbursement of refund to the assessees which is highly appreciated by assessees.

Comments

GST Update on recommendations of gst council on refund procedure part-13

Post a Comment

Query