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Amount to be Claimed as Refund on Export of Goods or Services

Rule 89(4) stipulates that in the case of export of goods or services or both without payment of tax under bond/LUT in accordance with the provisions of section 16(3) of the IGST Act, 2017, refund of ITC shall be granted as per the following formula:

where,-

  1. “Refund amount” means the maximum refund that is admissible;
  2. “Net ITC” means ITC availed on inputs and input services during the relevant period other than the ITC availed for which refund is claimed under sub-rules (4A) or (4B) [discussed below] or both;
  3. “Turnover of zero-rated supply of goods” means the value of zero-rated supply of goods made during the relevant period without payment of tax under bond/LUT, other than the turnover of supplies in respect of which refund is claimed under sub-rules (4A) or (4B) or both’
  4. “Turnover of zero-rated supply of services” means the value of zero-rated supply of services made without payment of tax under bond or LUT, calculated in the following manner, namely:-
    Zero-rated supply of services is the aggregate of the payments received during the relevant period for zero-rated supply of services and zero-rated supply of services where supply has been completed for which payment had been received in advance in any period prior to the relevant period reduced by advances received for zero-rated supply of services for which the supply of services has not been completed during the relevant period.
  5. “Adjusted Total turnover” means the sum total of the value of:

    1. the turnover in a State or a Union territory, as defined under section 2(112), excluding turnover of services; &
    2. the turnover of zero-rated supply of  services determined in terms of clause (D) above and non-zero- rated supply of services,

    excluding:

    1. the value of exempt supplies other than zero-rated supplies; and
    2. the turnover of supplies in respect of which refund is claimed under sub-rule (4A) or sub-rule (4B) or both, if any,
    during the relevant period
  6. “Relevant period” means the period for which the claim has been

Rule 89(4A) stipulates that in the case of supplies received on which the supplier has availed the benefit of deemed exports under Notification No. 48/2017 CT dated 18.10.2017, refund of ITC, availed in respect of other inputs/input services used in making zero-rated supply of goods or services or both, shall be granted.

Rule 89(4B) stipulates that where the person claiming refund of unutilised ITC on account of zero rated supplies without payment of tax has –

  • received supplies on which the supplier has availed the benefit of Notification Nos. 41/2017 IT(R) or 40/2017 CT(R) both dated 10.2017, or
  • availed the benefit of Notification 78/2017 Cus. or 79/2017 Cus. both dated 13.10.2017,

the refund of ITC, availed in respect of inputs received under the said notifications for export of goods and the input tax credit availed in respect of other inputs or input services to the extent used in making such export of goods, shall be granted.

Rule 89(5) of the CGST Rules, 2017 stipulates that in the case of refund on account of inverted duty structure, refund of ITC shall be granted as per the following formula –

where,-

  1. “Net ITC” means ITC availed on inputs during the relevant period other than the ITC availed for which refund is claimed under sub-rules (4A) or (4B) or both; and
  2. “Adjusted Total turnover” has the same meaning as assigned in sub-rule (4)

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