New Delhi: The Central Board of Indirect Taxes and Customs (CBIC) has sought to allay fears of harassment to the taxpayers in COVID-19 like situation. In a statement on Saturday, the CBIC said its measures vide Circular No. 133 dated 31.03.2020, to help GST returns filers to facilitate early ITC refunds and to ensure that the wrong ITC claims are not processed in the absence of relevant information, was “misconstrued in certain section of social media and other media as troubling the taxpayers”.
It explained that the Circular No. 133 (dated 31.03.2020) was with regard to the requirement to give HSN/SAC code along with the refund application. It elaborated: “The GST Law doesn’t allow refund of credit availed on services and/or Capital Goods in certain categories. For example, Capital Goods ITC refund is not permissible for refund of ITC on account of exports and other zero-rated supplies. Further, ITC availed on services and capital goods are not allowed to be refunded in Inverted Structure Refund category.”
The CBIC said that measures were taken into effect with GST Council’s approval in its 39th Meeting held on April 14, 2020 to mitigate delays in ITC refunds faced by the taxpayers besides ensuring that fake ITC claims were not processed. “It had been brought to the notice of GSTC by various stakeholders including the taxpayers. It was noticed that lot of time is spent in verification of whether the credit was availed on services and/or Capital Goods in certain categories for the refund claims,” it stated.
In order to address the difficulty faced by trade in providing this data at the time of processing of claim leading to delays and increase in compliance cost, it was decided in the GST Council to make declaration of classification codes a part of the application itself. The GST Council in the same meeting had also decided to allow bunching of tax periods across financial years to facilitate claim of refund by exporters. “This would apply to applications filed after 31.03.2020. It may also be noted that the due date of all such applications which were due during 20th March 2020 and 29th June 2020 has been extended to 30.06.2020,” it stated.
Reiterating its commitment towards helping GST taxpayers in the present COVID-19 situation, the CBIC stated that it had processed 12,923 refund applications involving claims worth Rs 5,575 Crore, out of which 7,873 claims worth Rs 3854 Crore were processed in the last week itself.