Chemixcil Logo
 
left
navright

News


Latest News


Product Categories

Home» Circulars» Imp Itc Refund Calculation Formula For Exports Against Lut Bond As Per Cgst Rules

Back
 
Imp - ITC Refund Calculation Formula for Exports against LUT/ Bond as per CGST Rules
 

 

CHEMEXCIL
Basic Chemicals, Cosmetics & Dyes Export Promotion Council
(Set-up by Ministry of Commerce and Industry, Govt of India)

Jhansi Castle 4th Fl., 7 Cooperage Road, Mumbai - 400 001.India.

Tel : +91 22 22021288 / * Fax : +91 22 22026684 *

E-mail : info@chemexcil.gov.in Web : https://chemexcil.in

 


EPC/LIC/GST_ITC_REFUND  11th July  2017

 

TO ALL MEMBERS OF COUNCIL

 

 

ITC Refund Calculation Formula for Exports

 

against LUT/ Bond as per  CGST Rules

 

 

Dear Members,

 

As you are aware,  export of goods and/or services are to be treated as “zero rated supplies” and a person making Zero Rated Supply can opt for either of the following options as per Section 16(3) IGST:

 

a)  Supply of goods or services or both under bond or LUT without payment of IGST and claim refund of unutilized ITC
b) Supply of goods or services or both on payment of IGST and claim refund of such tax paid on goods & services or both supplies

 

In our view the Export under Bond/LUT  will be preferred by the Exporters.

Kindly note that  ITC Refund as per CGST Rules are available in Chapter X   and it’s  important to understand the formula which will be used in calculation of refund for  export shipments.

For the sake of your convenience , we reproduce the text from the CGST  Rules 2017(Chapter X) as under-

 

(4)    In the case of zero-rated supply of goods or services or both without payment of tax under bond or letter of undertaking in accordance with the provisions of sub-section (3) of section 16 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017), refund of input tax credit shall be granted as per the following formula –

 

Refund Amount = (Turnover of zero-rated supply of goods + Turnover of zero-rated supply of services) x Net ITC ÷ Adjusted Total Turnover

 

Where,-

  1. "Refund amount" means the maximum refund that is admissible;

 

  1. "Net ITC" means input tax credit availed on inputs and input services during the relevant period;
  1. "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 or letter of undertaking;

 

  1. "Turnover of zero-rated supply of services" means the value of zero-rated supply of services made without payment of tax under bond or letter of undertaking, 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;
  1. "Adjusted Total turnover" means the turnover in a State or a Union territory, as defined under subsection (112) of section 2, excluding the value of exempt supplies other than zero-rated supplies, during  the relevant period;
  2. “Relevant period” means the period for which the claim has been filed

 

 

Members are requested to please take note of the above methodology for calculation of ITC  refund for exports against LUT/ Bond.    For full text of  CGST Rules, 2017 (as amended up-to 01/07/2017), please use below link-

http://www.cbec.gov.in/resources//htdocs-cbec/gst/cgst-rules-01july2017%20.pdf

 

For any comments/feed-back on ITC refund formula, members may revert to us on deepak.gupta@chemexcil.gov.in  and balani.lic@chemexcil.gov.in .

 

Thanking you,

 

Yours faithfully,

 

S.G BHARADI
EXECUTIVE DIRECTOR
CHEMEXCIL

 

 

 

left
Site visited: Web Site Hit Counters
navright
Copyright © 2014. All Rights Reserved by Chemexcil
Powered by: iBongo