Go AD-Free with CAclubindia Pro and Daily WhatsApp Updates. Subscribe Now!

Refund of excess GST Input due rate difference

452 views

Save Share

Sahil Ahuja

Accountant

75 Points Posted on 14 April 2020

ABC is using difference categories of inputs for manufacturing. It's input are taxed at 5,12,18%. But 70% inputs are taxed at 5%. Output of it are taxed at 5% only. It have accumulated input tax due to rate difference. Can ABC claim refund of GST?

Replies (3)

Quick Summary

If your business has accumulated input tax credit (ITC) due to a higher GST rate on inputs than on your output, you may be eligible for a refund. This situation, known as an inverted duty structure, allows you to claim back excess ITC under Section 54 of the CGST Act 2017. Note that ITC on capital goods is not eligible for such refunds.

Mayank Garg

32 Points Posted on 14 April 2020

Yes you can claim refund under inverted due to structure. in this category input goods tax rate is higher than output goods tax rate .

CA Sachin M Jain

CA | GST | Refunds | Advisory | Litigati

1463 Points Posted on 15 April 2020

Yes, as per section 54 of the CGST act 2017 you can rightfully claim refund of accumulated ITC in case of Inverted duty structure. Note : NO ITC of capital goods will be allowed.

Further clarification on refund contact - CA SACHIN M JAIN | 8097515447 | casachinmjain @ gmail.com