As per explanation 3 of section 54 of the CGST Act, A registered person may claim a refund of unutilised Input
Tax Credit (ITC). The ITC on account of inverted tax structure can be claimed at the end of any tax period
where the credit has accumulated on account of the rate of tax on inputs being higher than the rate of tax on
output supplies. A tax period is a period for which a return is required to be furnished.
Exceptions where the refund of the unutilised input tax credit cannot be claimed, are as follows:
- Output supplies are nil-rated or fully exempt supplies except for supplies of goods or services or both as may be notified by the Government on the recommendations of the GST Council.
- If the goods exported out of India are subject to export duty.
- If supplier claims refund of output tax paid under IGST Act.
- If the supplier avails duty drawback or refund of IGST on such supplies.
Yes, by dint of notification no. 5/2017 – central tax dated 28.06.2017 has barred the following category of goods from inverted duty structure:
| S.NO. | Tariff item/heading/sub heading/chapter | Description of Goods |
| 1. | 5007 | |
| 2. | 5111 to 5113 | |
| 3. | 5208 to 5212 | |
| 4. | 5309 to 5311 | |
| 5. | 5407, 5408 | Woven fabrics of |
| 6. | 5512 to 5516 | |
| 7. | 60 | |
| 8. | 8601 | Rail locomotives powered from an external source of electricity or by electric accumulators |
| 9. | 8602 | Other rail locomotives; locomotive tenders; such as Diesel-electric locomotives, Steam locomotives, and tenders thereof |
| 10. | 8603 | Self-propelled railway or tramway coaches, vans, and trucks, other than those of heading 8604 |
| 11. | 8604 | Railway or tramway maintenance or service vehicles, whether or not self-propelled (for example, workshops, cranes, ballast tampers, trackliners, testing coaches, and track inspection vehicles) |
| 12. | 8605 | Railway or tramway passenger coaches, not self-propelled; luggage vans, post office coaches, and other special purpose railway or tramway coaches, not self-propelled (excluding those of heading 8604) |
| 13. | 8606 | Railway or tramway goods vans and wagons, not self-propelled |
| 14. | 8607 | Parts of railway or tramway locomotives or rolling-stock; such as Bogies, Bissel-bogies, axles and wheels, and parts thereof |
| 15. | 8608 | Railway or tramway track fixtures and fittings; mechanical (including electro-mechanical) signaling, safety or traffic control equipment for railways, tramways, roads, inland waterways, parking facilities, port installations, or airfields; parts of the foregoing |
From 01.02.2019 the time limit in the case of a refund of unutilised input tax credit under clause (II) of the first provision to section 54(3) is two years from the due date for furnishing return under section 39 for the period in which such claim for refund arises.
No. If all the credit claimed are present in GSTR 2A and details of outward supply match with GSTR 1, then there is no need to submit the papers physically. Though the refund amount would be based upon the formula. All the ITC accumulated can be refunded back by what are the documents that I need to upload for this service?