September 17, 2021

Export through Courier| IGST Refund process through ECCS Application (Express Cargo Clearance System)

Goods and Service Tax (“GST”) clearly functions on the concept of “Export the Goods/Services and not the taxes”. Therefore, all taxes paid on goods/services exported out of India must be refunded to the exporter without any failure. Under GST, a refund of IGST paid on exported goods is provided automatically on the filing of shipping Bills to avoid funds blocking of the exporter.

In case of export made with payment of IGST, shipping bill filed for export of goods is automatically considered as Refund application and upon processing of shipping bills on IECGATE, the system will automatically process the refund of IGST.

1. Challenges in IGST refund on goods exported through Courier

Where goods are exported through courier, shipping bills are not filed online. Rather a manual shipping bill is filed in form CSB-V Form (Courier Shipping Bill-V).
However, since CSB-V are filed manually, therefore, details of CSB-V are not processed on ICEGATE automatically. Non-processing of Shipping Bill information on ICEGATE does not allow automatic processing of refund of IGST paid on export.

2. Steps taken to resolve refund issues with respect to goods exported through courier

To resolve the issue of paper work and manual intervention in courier export cases, Central Board of Indirect Taxes and Customer has developed a new application namely ECCS (Express Cargo Clearance System).
The ECCS was launched in 2017 for the electronic clearance of courier consignments.

3. Advisory issued by CBIC on IGST Refund module for Exports in ECCS Application

Initially Office of the Additional Director General (Systems) issued an Advisory on Roll Out of IGST Module for Export in ECCS Application vide F.No. I(9)/1/2020-Sys(W) dated 20th January, 2020.
Later on an ICES advisory 21/2020 dated 20th June, 2020 was issued with respect to IGST refund processing of Courier Export in ICES (Indian Customs EDI System).
Office of the Commissioner of Customs II issued Public No. 07/2020-21 dated 2nd July, 2017 on IGST refund module for Export in ECCS Application.

This advisory explains the IGST refund workflow in ECCS (Express Cargo Clearance System).

4. Process of IGST Refund on Courier Export through ECCS Application

IGST refund processing for exports through courier shipment has been enabled in ICES.
As a pre-requisite, Courier companies are required to upload data related to Manual Courier Shipping Bills in ECCS and also required to register/update Bank details of Exporter in ICES (Indian Customs EDI System).

In this article, we will understand the process of uploading the Manual courier shipping on ECCS with the approval of the customs officer and processing of IGST refund on the Exported goods.

4.1 Upload Manual Courier Shipping Bills by Courier Company

Every Courier company is required to create login credentials at https://eccsidm.cbic.gov.in.
Only 89 courier companies are registered as “Authorised Couriers” on ECCS portal. List of such companies can be access at https://courier.cbic.gov.in/courierTerminalList.jsp.
Post Login, Courier company shall download the Sample Template file and will update the file with manually cleared shipments.
Courier company shall upload the updated file at “Export>Manually Cleared Data Upload”.
Uploaded details of manually cleared shipping Bills will move to Customs for approval.

4.2 Approval/Rejection of Shipping Bills by Custom Officer

Custom officer shall login on ECCS portal and will be able to see data of manually cleared Shipping Bills under “Export>Approve Manually Cleared Shipping Data”
Custom officer will have the two options, i.e., either to approve or Reject.

4.3 Status of Manual Shipping Bills by Courier Companies

Action by Custom officer will appear on ECCS portal of courier company and courier company will be able to access the data at “Export>Manually Cleared Shipment>View”.
Files Validation unsuccessful and rejected: In this case the courier company is required to amend the file as per custom officers comments. After updating the file, the same be resent to custom for approval.
Files Validation successful and accepted: Approved data will be converted into XML through utility and same shall be transmitted to IECGATE for further processing of IGST refund.

4.4 Processing of data by ICEGATE

Data transmitted to ICEGATE will be process and ICEGATE shall further process the data.
If ICEGATE validation is successful then the Success Response Generated and data is further transmitted to ICES.
If ICEGATE validation is unsuccessful then the Failure Response Generated and data is sent back to ECCS.

Flowchart of uploading Manual Courier Shipping Bill

4.5 Processing of IGST Refund in ICES

Files forward to ICES by ICEGATE are revalidated by ICES and successfully validated files are transferred to GSTIN.
Further the ICT (Information and Communication Technology) official is required to generate scroll accessing ICES and send it to ICEGATE.
ICEGATE forwards it to PFMS (public financial management system) for IGST refund amount transfer.
PFMS process requests and if satisfied with the authenticity forward the request to the Bank.
Bank credits the refund amount to the exporter.

4.6 Data validation done at ICES for processing refund

Once the data is transmitted to ICES through the above-mentioned procedure, ICES performs the following validation checks on data to ensure correct and eligible refund amount is processed:

Verification and approval through IGST_VFN role –
- Once data is available in ICES, an existing IGST_VFN module should be used for final verification and approval of the uploaded data. This is the same module which is used for IGST refund related verification of manual/non- EDI shipping bills.
- The System manager (SM) or Alternate System Manager (ASM) is required to map the officer(s) dealing with courier IGST refunds for IGST_VFN role.
- Mapping of concerned officers is a prerequisite.
- The officer shall login at Cargo Site and shall verify the details of Shipping Bills.
- Unless a shipping bills is verified and submitted in this role at ICES, the same shall not be considered for IGST refund procedure.
Account details submission – The account details of the exporter should be updated in ICES by the exporter.
IGST validation procedure – once the steps 1 and 2 are completed the system runs the validation process of matching the received data with the corresponding data of GSTR-1. If any mismatch between the data the error code (enclosed below) will be generated and available on ICEGATE to the exporter and on IGST_VFN role to the office in ICES. If the error is related to incorrect filing of return, then the same is advised to the exporter to amend in GSTR-1.
Refund Scroll – Finally temporary and final scrolls options will be available. Officers of the concerned Air Cargo Commissionerate can generate the successfully validated shipping Bills.

Flow chart of process of IGST refund

DISCLAIMER: The views expressed are strictly of the author and VJM & Associates LLP. The contents of this article are solely for informational purpose. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon.

GST Portal may facilitate revision of GST returns

CBIC issued instruction on issuance of Show Cause Notice on employee Secondment pursuant to NOS Judgment

GST on reimbursement of Electricity Charges| Clarification and Issues around

Taxability of Personal Guarantee and Corporate Guarantee under GST| Clarified by CBIC

CBIC issued guidelines to be followed by CGST field officers while investigating to maintain ease of business

News and Announcements

CBIC issued guidelines to be followed by CGST field officers while investigating to maintain ease of business

Investigations, summon, letters from GST Authority has become common in business from last sometime and there are many practical issues which comes alongwith these communication. GST investigations are at many times hampering regular business activities as well. Further, there are many practical issues being faced by the GST Authorities as well as taxpayer such as prior approval, simultaanoues investigation by more than one GST authority, uncessary information asked etc.

16/04/2024 No Comments

Returns

GST Portal may facilitate revision of GST returns

Concept of revision of Tax returns is a very usual and vital part of the tax system as it allows taxpayers to rectify unintentional errors made while filing tax returns. Every tax system including income tax provides a facility to revise tax returns upto specified time period. Under pre-GST regime as well, taxpayers were available with the option file revised VAT, Central Excise and Service Tax return. However, Goods and Service Tax has not yet provided that facility to revise GST returns to the taxpayers.

07/02/2024 No Comments

CBIC (Central Board of Indirect Taxes and Customs)

Judgements

CBIC issued instruction on issuance of Show Cause Notice on employee Secondment pursuant to NOS Judgment

The Department has showered the Industries with Show Cause Notices, issued in Form DRC-01, as the last date of issuance of SCN was 30th September, 2023 for FY 2017-18 and 31st December, 2023 for FY 2018-19. One of the major grounds on which thousands of MNCs were served with Show Cause Notice was the taxability of Secondment of employees in Indian Company by Foreign Holding Company.

09/01/2024 No Comments