IGST Refund from Custom | Invoice mismatch Cases

IGST Refund from Custom - Invoice mismatch Cases

Ministry of Finance via circular no. 05/2018-Customs, has clarified certain error done by exporters while filling there returns under GST consequently non – release of there IGST refund from custom where exports has been made on payment of IGST. Such cases are marked as SB005 error code by custom.

As per said circular, 40000 crores refunds of refunds has been sanction by CBEC.  Information is being made available to exporters on a real-time basis with regard to the errors status on ICEGATE website for registered users. Details of refund sanctioned is being sent through SMS on registered mobile phones.

1. Mistakes in information furnishing to GSTN while filing GSTR 1 / Table 6A or GSTR 3B.

The major errors that are committed by the exporters are

  1. Incorrect Shipping bill numbers in GSTR 1
  2. GSTIN declared in the shipping bill does not match with the GSTIN used to file the corresponding GST Returns
  3. Mismatch of invoice number, taxable value and IGST paid in the Shipping Bill vis-à-vis the same details mentioned in GSTR 1 / Table 6A which is the most common error hampering.
  4. This error is because of the fact that exporters are using two sets of invoices, one invoice for GST and another invoice for Customs which is resulting in mismatch of invoice numbers, including mis-match in taxable value and IGST paid in those invoices.
  5. Non-filing or incorrect filing of electronic Export General Manifest (EGM).

2. The pre-requisites and precautions that need to be taken for successful processing of refund claims.

i. Exporters have to file GSTR 3B with taxable value for export and IGST paid against exports indicated in appropriate fields.

ii. Large number of exporters have filed incomplete GSTR 1 or Table 6A where shipping bill number or date or port code are missing. These records are not processed / forwarded to Customs by GSTN. E-mails have been sent to exporters asking them to correct their records through amendment process of GSTR 1 i.e through Table 9 of GSTR 1 of the following month.

Exporters have to file GSTR 1 or Table 6A for the exports made with correct details such as Invoice number, Taxable value, IGST paid, Shipping Bill number, Shipping Date and Port Code.

iii. The aggregate IGST paid amount claimed in GSTR 1 or Table 6A should not be greater than the IGST paid amount indicated in Table 3.1(b) of GSTR 3B of the corresponding month.

iv. Exporters may be advised to use Table 9 of GSTR 1 of the following month to amend the records of previous month. In cases where exporters have already filed information through Table 9 of GSTR 1, the said information is being validated by GSTN. The validated information is expected to be forwarded by GSTN to Customs by mid-March 2018 for further processing.

v. Exporters may be advised to track the refund status and errors pertaining to their shipping bills on the ICEGATE website. The registration process demo, advisory and the needed IT configurations are hosted on the ICEGATE website under the following links.

Registration Demo link: https://www.icegate.gov.in/Download/New_Registration_Demo_Updated_APPROVED.pdf
Registration Advisory link: https://www.icegate.gov.in/Download/v1.2_Advisory_Registration_APPROVED.pdf
Java set up for the DSC upload: https://www.icegate.gov.in/Download/JavaSetupForDSC.pdf

vi. Exporters may be advised to take due care to ensure that the details of invoice such as invoice number, taxable value and IGST paid mentioned in GSTR 1 and shipping bill match with each other and the invoice issued is compliant with the GST Invoice Rules, 2017.

3. Processing of IGST Refund by Custom where Export refund has been stuck up due to Invoice Mis-Match.

The alternative mechanism envisages an officer interface on the Customs EDI System through which a Customs officer can verify the information furnished in GSTN and Customs EDI system and sanction refund in those cases where invoice details provided in GSTR 1/ Table 6A are correct though the said details provided in the shipping bill were at variance. It is pertinent to note that refund claims would be processed in only those cases where the error code is mentioned as SB005.

i. The exporter shall provide a concordance table indicating mapping between GST invoices and corresponding Shipping Bill invoices, as annexed in support of the refund claim to the designated officer in the Custom house. A scanned copy of concordance table may also be sent to dedicated email address of Customs location from where exports took place.

ii. Customs EDI system shall display list of all the invoices pertaining to such SBs vis-a-vis the invoice data received from GSTN. The officer shall verify the following:

  1. Duly certified concordance table submitted by the exporter as per Annexure A indicating mapping between GST invoice and corresponding Shipping Bill invoice;
  2. IGST taxable value and IGST amount declared in the Shipping Bill.
  3. IGST details declared in the Shipping Bill should be in proportion to the goods actually exported.

iii. After determining the correct refund amount, the officer need to enter the same into the Customs EDI system. The officer has the facility to edit the IGST paid details in case of short shipment or incorrect calculation by the exporter. The officer shall complete the verification by accepting or rejecting or amending the same.

iv. Once all the invoices pertaining to Shipping Bill are verified by the officer, the system shall calculate the scroll amount against a shipping bill, after subtracting the drawback amount for each invoice where applicable, and display the refund amount to the officer for approval.

v. Invoices in any particular GSTR 1 where refund is sanctioned shall be disabled in the system to prevent IGST refund from custom against same invoice in future.

vi. Once refund is sanctioned by the officer, the shipping bills would be available for generating scroll as per normal process.

vii. This procedure is available only for Shipping Bills filed till 31st December 2017

3.1 Extention for shipping bill filled in case of IGST refund for invoice mismatch cases

Table provide various circular extended date of shipping bill will be considered where IGST refund has been stuck up due to SB005 error.

Circular noShipping Bills
Circular No. 05/2018-CustomsShipping Bills filed till 31/12/2017
Circular No. 08/2018-CustomsShipping Bills filed till 28/02/2018
Circular No.15/2018-CustomsShipping Bills filed till 30/04/2018
Circular No.22/2018-CustomsShipping Bills filed till 30/06/2018
Circular No. 40/2018-CustomsShipping Bills filed till 15/11/2018
Circular No. 26/2019-CustomsShipping Bills filed till 31/07/2019
Circular No.22/2020-CustomsShipping Bills filed till 31/12/2019

Know certain other issues relating to GST 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.

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