IGST refund for Exporters – Provisions
As per Rule 96 of the CGST Rules 2017, the shipping bill filed by an exporter shall be deemed to be an application for refund of integrated tax paid on the goods exported out of India. Being so, opting LUT/NA or mentioning “0” against “IGST Paid” field, will keep away the exporter to avail refund claim even if they have paid the IGST as the exporter himself has declared the same in the Shipping Bill. However, following Circular No. 8/2018-Cus dated 23.03.2018, an option has been made available by the DG Systems in ICES for sanctioning IGST refund in respect of those cases where the exporter has erroneously declared that the shipment is without payment of IGST, although they have declared and paid the IGST in GST Returns.
IGST refund Procedure for Exporters
Once the GSTR-1 and GSTR-3B are filed “CORRECTLY”, then the data dump will match with the GST Network and it will transmit the data to ICES (Indian Customs EDI Systems).
On receipt of the data from the GST Server, an integration between Shipping Bill and data received from the GST takes place.
If no mismatch / error is found while integration, Systems tagged the Shipping Bill as “Ready” for scroll generation. PFMS (Public Financial Management System) is the portal to remit the amount to the exporter’s account against the eligible shipping bills/invoices.
“Not Ready” tag is given to the Shipping Bill in two situations, namely:
A. Either the data pertaining to the Shipping Bill/Invoice, has not been sent by the GST Network to ICES (i.e. Customs Portal).
B. Or the data has been received from the GSTN, but the same has been stuck into some error code(s) while integration.
If systems notice any mismatch between Shipping Bill data and GST data, it generates Response Codes viz. SB001, SB002, SB003, SB004, SB005 and SB006.
GST Network does not transmit the data to ICES
There may be several reasons why GST Network does not transmit the data to ICES:
- Either GSTR-1 or GSTR-3B or both has not been filed with GSTN.
- Amount of IGST is more in GSTR-1 than the IGST amount shown in the GSTR-3B. So it is important that data pertaining to domestic supplies should also be in symmetry as far as matching of GSTR-3B and GSTR-1 is concerned.
- Amount of IGST is to be shown in 3.1(a) instead of 3.1(b) in GSTR-3B. In GSTR – 3B column 3.1 Details of Outward Supplies and Inward Supplies liable to reverse charge; Amount of Export Turnover is to be filed in 3.1.(b) – Outward taxable supplies (zero rated) instead of it to be entered in 3.1.(a)
- Invoices of that particular month are not being filled up properly in Table 6A. (like Port Code, Shipping Bill Number, Shipping Bill Date etc.).
Solution: Data in GSTR -1 can be amended using Table 9A. It is worth mentioning that only single time amendment is allowed in an invoice in Table 9A. So while correcting the GSTR-1, exporters are advised to remain cautious and maintain 100% accuracy.
As far as correction in GSTR-3B is concerned where mistakenly amount of 3.1(b) has been shown against 3.1(a), Exporters can approach designated Customs officers at ICD/Ports for verification of GSTR data. The officer will fill up the information in Annexure A email the same to DG Systems.
Data has been received from the GSTN, but the same has been stuck into some error code(s) while generating IGST refund
If systems notice any mismatch between Shipping Bill data and GST data, it generates Response Codes (IGST Refund Error Codes) viz. SB001, SB002, SB003, SB004, SB005 and SB006.
Response Code SB001 : It is generated when Shipping Bill Number or Shipping Bill Date at ICES is not matched with what is mentioned in the GSTR-1.
Solution: Same can be corrected by using Table 9A of GSTR-1.
Response Code SB002 : It is generated when Local EGM has not been filed or filed with some errors.
Solution: Same can be corrected with the help of Container/Shipping Line Agent.
Response Code SB003 : It is generated when GSTIN number is not mentioned in the Shipping Bill or mentioned partially.
Solution: Exporter may approach Customs Officers at the Ports/ICDs from where actual export took place and get the error corrected.
Response Code SB004 : Record already received from the GSTN.
For this Error no action is required from the exporter.
Response Code SB005 : It is generated when Invoice Number or Date of Shipping Bill does not match with what is mentioned in the GSTR-1
Solution: a. Same can be corrected by using Table 9A of GSTR-1.
b. Exporter may also approach Customs formation (from where export took place) alongwith Annexure ‘A’ (Concordance Table). Officers at Customs formations have been allotted physical interface to rectify the error. Earlier this facility was available for the Shipping Bills filed upto 31.12.2017, however, it has been decided by the Board to extend the facility to those shipping bills filed till 28.02.2018. However, it should be kept in mind that no further extension would be given in this regard.
Response Code SB006 : It is generated when either EGM at Gateway has not been filed or filed with some errors.
Solution: a. Get the EGM filed
b. If EGM at Gateway is filed with some errors get it corrected with the help of Shipping Line Agent.
You might get Error Code “C” which mean mismatch of Container Number. For this, officers at Gateway port has been given physical interface (PREV_OFF) to correct this error. Apart from this Error Code “M” (Gateway Port Code in Truck Summary is different from Actual Gateway Port) and Error Code “L” (Leo Date>Sail Date) may be corrected at Local Customs Locations.