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The industry had been facing challenges due to deficiency memos issued within 2 years time frame. Finally, CBIC has rationalized the GST Refund rules via Central Goods and Services Tax (Fourth Amendment) Rules, 2021. This will definitely help GST taxpayers. These amendments have been discussed in detail.

In Short

1. Time taken to issue the deficiency memo shall not be considered for a time limit of 2 years to file the GST refund application.

2. New Facility, Now, we may withdraw the GST refund application filed.

In Detail

CBIC through Notification 15/2021- Central Taxon 18, May 2021 amended CGST Rules 2017 related to GST refunds.

Amendments In GST Refund Related Rules

I. Amendment in Rule 90(3) as follows:

Relaxation in limitation of the time period

  • The time period, between  the date of filing of the refund claim and the date of communication of the deficiencies, shall be excluded from the period of two years,
  • When a fresh refund application is filed after rectifying the deficiencies.

Quick Question: Does it apply to past Refund applications?

Ans: No. these rules are applicable from the date of notification that is  18 May 2021. But not retrospectively.

II. Amendment in Rule 90(5) & (6) as follows

Option to withdraw filed GST Refund Application

  • New facility brought, Now, we may withdraw the GST refund application filed, But
  • Before issuance of provisional refund sanction order/ final refund sanction order/ payment order/ refund withhold an order.

Quick Questions

1. Which form should be used for withdrawal?


2. What would happen to debits in electronic credit/cash ledgers?

  • On submission of application for withdrawal of refund in FORM GST RFD-01W,
  • If any amount debited from an electronic credit ledger or electronic cash ledger while filing an application for a refund 
  • Shall be credited back to the ledger from which such debit was made

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Category GST, Other Articles by - Ajay Kumar Maggidi