Circular No.ES/94/ 2018-19 15th June, 2018
To: Members of the Council
Sub: Circulars clarifying issues related to SEZ and refund of unutilized ITC for job workers
Dear Member,
CBIC has issued Circular No. 48/22/2018-GST dated 14th June, 2018 clarifying matters related to SEZ and refund of unutilized ITC for job workers.
CBIC has clarified a long pending issue faced by Fabric Processors regarding refund of unutilized ITC on account of inverted duty structure.
Vide this Circular CBIC has clarified that the fabric processors shall be eligible for refund of unutilized ITC on account of inverted duty structure under section 54(3) of the CGST Act even if the goods (fabrics) supplied to them are covered under Notification No. 5/2017-Central Tax (Rate) dated 28.06.2017. Our Chairman, Vice-Chairman, the Committee Members of the Council thank the Hon’ble Union Minister of Textiles, Smt. Smriti Zubin Irani for her whole-hearted support for pursuing the matter with CBIC. Our special thanks to the Drawback Committee for hearing the plea of our Fabric Processors who were reeling under the stress.
Relevant extract of the Notification is given here- below:-
Issue
Whether independent fabric processors (job workers) in the textile sector supplying job work services are eligible for refund of unutilized input tax credit on account of inverted duty structure under section 54(3) of the CGST Act, 2017, even if the goods (fabrics) supplied are covered under notification No. 5/2017-Central Tax (Rate) dated 28.06.2017?
Clarification issued vide Notification No. 5/2017-Central Tax (Rate) dated 28.06.2017
Clarification issued vide Circular No. 48/22/2018-GST dated 14th June, 2018
Members may kindly refer Circular No. 48/22/2018-GST dated 14th June, 2018 for more details.
Thanking you,
Yours faithfully,
S.BALARAJU
EXECUTIVE DIRECTOR