IGST Refund Subject to Deduction of Higher Drawback | HC

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  • Last Updated on 2 May, 2026

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IGST refund

Case Details: Kunal Housewares (P.) Ltd. vs. Union of India [2026] 185 taxmann.com 541 (Bombay)

Judiciary and Counsel Details

  • G. S. Kulkarni & Firdosh P. Pooniwalla, JJ.
  • Devashish K. Trivedi & Garvit Khandelwal, Advs. for the Petitioner.
  • Jitendra B. Mishra, Ashutosh Mishra, Maya Majumdar & Rupesh Dubey, Advs. for the Respondent.

Facts of the Case

The petitioner engaged in the export of various stainless steel items, effected zero-rated supplies and paid IGST on such exports. The petitioner thereafter sought refund of the IGST so paid under the zero-rated export mechanism. The jurisdictional officers under CGST withheld the refund on the ground that the petitioner had already availed a higher duty drawback by selecting ‘Column A’ in the shipping bills, thereby rendering the claim ineligible for a full IGST refund. The petitioner contended that it was entitled to a refund of IGST notwithstanding the drawback option exercised and disputed the withholding of the amount. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that IGST refund on zero-rated exports cannot be granted in a manner that results in impermissible double benefit when the higher duty drawback has already been availed. It was observed that under Section 54 of the CGST Act and the Maharashtra GST Act, Section 16 of the IGST Act and Rule 96 of the CGST Rules, a refund is admissible only where the rates under Column A and Column B of the shipping bills are identical or where the excess drawback component is neutralised. The Court reasoned that availing higher duty drawback while simultaneously claiming full IGST refund would amount to duplication of export incentives since pre-GST levies stand subsumed under the GST regime. It further held that the petitioner could not be granted the full refund unless the differential drawback was repaid or adjusted, and directed that the refund be allowed only after deducting the differential drawback amount along with 7% interest calculated from the date of the shipping bill.

List of Cases Reviewed

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied