Page 25 - Craftcil Aug & Sep 2023

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Question : Is there any provision in GST for tax treatment of goods returned by the recipient?
Answer : Yes, Section 34 deals with such situations. Where the goods supplied are returned by the recipient, the
registered person (supplier of goods) may issue to the recipient a credit note containing the prescribed
particulars. The details of the credit note shall be declared by the supplier in the returns for the month
during which such credit note was issued but not later than September following the end of the year in
which such supply was made or the date of filing of the relevant annual return, whichever is earlier. The
details of the credit note shall be matched with the corresponding reduction in claim for input tax credit by
the recipient in his valid return for the same tax period or any subsequent tax period and the claim for
reduction in output tax liability by the supplier that matches with the corresponding reduction in claim for
ITC by the recipient shall be finally accepted and communicated to both parties.

Question : Can a principal send inputs and capital goods directly to the premises of a job worker without bringing
it to his premises?

Answer : Yes, the principal is allowed to do so. The input tax credit of tax paid on inputs or capital goods can also be
availed by the principal in such a scenario. The inputs or capital goods must be received back within one
year or three years respectively failing which the original transaction would be treated as supply and the
principal would be liable to pay tax accordingly.

Question : Sometimes goods are destroyed or lost due to various reasons? Can a person take ITC to the extent of
such goods?

Answer : No, a person cannot take ITC with respect to goods lost, stolen, destroyed or written off. In addition, ITC with
respect to goods given as gifts or free samples are also not allowed.

Question : What is the time limit for taking a refund?
Answer : A person claiming refund is required to file an application before the expiry of two years from the "relevant
date" as given in the Explanation to section 54 of the CGST/SGST Act.

Question : Is it necessary to execute Bond for exports without payment of IGST?
Answer : No, The facility to export under Letter of Undertaking (LUT) has been extended to all zero rated suppliers
(barring a few exceptions such as those who have been prosecuted for an offence involving tax of Rs 2.5
crore) vide Notification No. 37/2017 - Central Tax dated 4.10.2017. Circular No. 8/8/2017-GST dated 4.10.2017
may also be referred to. Only those not eligible for LUT are required to furnish Bond.

Question : In case of refund under exports, whether BRC is necessary for granting refund?
Answer : In case of refund on account of export of goods, the refund rules do not prescribe BRC as a necessary
document for filing of refund claim. However, for export of services details of BRC are required to be
submitted along with the application for refund. However, for exports of goods also, if the realisation is not
received within the prescribed time, the refund money has to be returned with interest to the Government.

Question : Is there any time limit for refund of ITC on exports?
Answer : Yes, refund has to be sanctioned within 60 days from the date of receipt of application complete in all
respects. If refund is not sanctioned within the said period of 60 days, interest at the rate notified not
exceeding 6% will have to be paid in accordance with section 56 of the CGST/SGST Act. However, in case
where provisional refund to the extent of 90% of the amount claimed is refundable in respect of zero-rated
supplies made by certain categories of registered persons in terms of sub-section (6) of section 54 of the
CGST/SGST Act, the provisional refund has to be given within 7 days from the date of acknowledgement of
the claim of refund.

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