EXEMPTED GOODS EXPORT

Hello Pandian,
You're asking a very practical and important question — how to claim GST refund on freight charges paid for export of exempted goods, since the goods themselves are exempt from GST, but you paid GST on the input service (freight).

Let’s break this down clearly.

✅ Key Point:

Even though the exported goods are exempt, if you have paid GST on input services (like freight) used for exports, you may be eligible for refund of unutilized ITC under Rule 89(4B) of the CGST Rules.

✅ Legal Provision – Rule 89(4B)

Refund of input tax credit shall be granted even if the exported goods are exempted, where tax is paid on input services (e.g., freight charges) used for export.

✅ Type of Refund Claim:

You will apply under:

📌 "Refund of unutilized ITC on account of export of exempted goods without payment of tax (Rule 89(4B))"

✅ Checklist of Forms and Documents to File:

1. GST RFD-01 – Refund Application

• File it online on GST portal

• Select Refund Type: "Exports of exempted goods without payment of tax – Rule 89(4B)"

2. Required Attachments/Documents:

✅ Steps to File on Portal:

1. Go to GST Portal → Login

2. Services → Refunds → Apply for Refund

3. Select “Refund of unutilized ITC on account of exports of exempted goods without payment of tax”

4. Select period → Fill relevant tabs

5. Upload necessary documents

6. Preview and Submit → File with DSC or EVC

✅ Important Notes:

• Only input services used for export (like freight) are eligible.

• ITC refund is limited to the proportion used for export of exempt goods.

• You must not have availed drawback of GST or claimed under any other refund type.

📌 Sample Input Service:

✅ Processing Time:

• Acknowledgment in 15 days (Form GST RFD-02)

• Refund issued in 60 days (if complete and valid)

✅ Summary:

When you export exempted goods and have paid GST on freight charges (for example, under reverse charge or service received from GTA/shipping line), you can claim a refund of input tax paid on such input services used in the export process.

Here’s a detailed step-by-step guide:

1️⃣ Form to be Filed:

• The main form for claiming a GST refund is Form GST RFD-01.

• This form is filed online on the GST portal under the “Refunds” section.

2️⃣ Select the Refund Category:

While applying, select the correct category —

“Refund of tax paid on input services used in export of exempted goods.”

3️⃣ Documents Required:

You need to upload the following documents along with Form RFD-01:

• Statement 3 (Annexure): Details of export invoices.

• Shipping bills / Export invoices (proof of export).

• BRC / FIRC: Proof of receipt of payment in convertible foreign exchange.

• Freight invoices and proof of GST payment (for which refund is claimed).

• CA certificate (if refund amount > ₹2 lakh).

• Declaration under Rule 89(2)(l) that no Input Tax Credit has been availed on exempted goods.

4️⃣ Processing of Refund:

• After submission, the proper officer will verify documents and eligibility.

• If found correct, a provisional refund (90%) is sanctioned within 7 days, and the balance 10% after verification.

5️⃣ Refund Order & Payment:

• Refund is issued through Form RFD-06 (Final Order).

• Payment advice is generated in Form RFD-05 and credited directly to your bank account.