CBIC issues instructions providing manner of processing & sanctioning refunds of IGST paid by risky exporters

Instruction No. 04/2022, dated 28-11-2022

Rule 96 of the Central Goods and Services Tax Rules, 2017 provides for the refund of IGST paid on the export of goods. Further, it is also provided that in a few specified scenarios, the refund may be withheld. One such scenario is where on the basis of data analysis and risk parameters, the Principal Director General/ Director General of Directorate General of Analytics and Risk Management (DGARM) is of the opinion that in order to safeguard the interest of revenue, the verification of credentials of the exporter including the verification of ITC availed by the exporter is essential before granting the refund. Therefore, in such cases, the refund claim is first transmitted to the jurisdictional proper officer of the Central tax, State tax and Union Territory tax in the system generated Form GST RFD-01.

In this regard, the CBIC has issued detailed instructions providing the manner of processing and sanction of IGST refunds where such a refund is withheld in terms of the above-said provisions.

In view of these detailed instructions, the SOPs earlier issued, dated 23-01-2020 and 20-05-2020, prescribing the procedure to be followed for verification of the risky exporters are superseded by these instructions.

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