IGST Export Refunds – (a) extension in SB005 alternate mechanism and (b) revised processing in certain cases including disbursal of compensation Cess

Circular No. ES/ 261/2018-19                                                                                    October 26, 2018 

To: Members of the Council

Sub: IGST Export Refunds – (a) extension in SB005 alternate mechanism and (b) revised processing in certain cases including disbursal of compensation Cess

Dear Member,

We are pleased to inform you that CBIC has issued Circular No. 40/2018- Customs dated 24th October, 2018 extending the rectification facility for Shipping Bills filed upto 15th November, 2018 and revising the process in certain cases including disbursal of compensation Cess.

In this connection, we would like to highlight here-below the main points of the Circular which are as follows :-

(A)       Remarks made by CBIC in cases related to SB005 Errors –

  • Exporters have committed many errors which has held back sanctioning of IGST refund.
  • CBIC had introduced several options and alternative mechanisms in the past through which various mismatch errors between the Shipping Bill (SB) and GSTR 1 data can be handled in the system.
  • Several circulars issued by CBIC providing an alternative mechanism with an officer interface to resolve invoice mismatches (SB005 error) was provided for the shipping bills filed till 30th June, 2018.(Kindly refer Circular Nos.05/2018-Customs dated 23.02.2018, 08/2018-Customs dated 23.03.2018, 15/2018-Customs dated 06.06.2018 and 22/2018-Customs dated 18.07.2018)
  • Cases of SB005 error have gone down, but still representations have been received from exporters, associations etc. either due to lack of familiarity, awareness and the same mistake is committed due to which their IGST refunds are stuck.
  • Request for extension of date by exporters.
  • Issue examined by CBIC.

(B)       Decision taken by CBIC on the above Errors of SB005 –

  • The Board has decided to extend the rectification facility to Shipping Bills filed up to 15th November, 2018.
  • Exporters have to ensure that the details of invoice, such as invoice number, IGST paid etc. under GSTR 1 and shipping bills match with each other since the same transaction is being reported under GST laws and Customs Act.

(C)       Noted by CBIC –

  • S/Bills which have not been scrolled due to the IGST paid amount erroneously declared as ‘NA’ are already being handled through officer interface as per Board’s Circular 08/2018– Customs dated 23rd March, 2018.
  • However, no such provision was hitherto available in respect of those S/Bills which were successfully scrolled, albeit with a lesser than eligible amount.

(D)       Clarification on other Representation received by CBIC –

  • In cases where the refund scroll has been generated for a much lesser IGST amount than what has actually been paid against the exported goods.

Following reasons cited by CBIC

  1. Errors made by the exporter/ CHA in declaring the IGST paid amount in S/Bills or,
  2. Cases where Compensation Cess paid amount was not entered by the exporter in the S/Bills along with the IGST paid amount or the same details were not transmitted by GSTN, and the scroll consequently got generated only for the IGST amount or,
  3. Typographical mistake by the customs officer while sanctioning the refund through officer interface.

(E)       CBIC provides relief to exporters for the above categories – 

~    Directorate of Systems has now provided a facility in ICES for the processing and sanctioning of the eligible differential IGST refund.

~    The facility would be officer interface based and is similar to the procedure for processing certain SB005 refund claims refer Circular No 05/2018-Customs dated 23rd February, 2018.

~    This facility would be available only for cases where S/Bills have been filed till 15th November, 2018.

~    Exporters need to be careful while filing details in S/ Bills as a similar facility may not be available in future for the same mistake for referred shipping bill.

(F)       Procedure to be followed for claiming refund of the differential amount –

  • The exporter is required to submit a duly filled and signed Revised Refund Request (RRR) annexed to this circular to the designated AC/DC. 
  • A scanned copy of the RRR may also be mailed to dedicated email address of Customs locations from where exports took place.
  • The designated/ concerned AC/ DC will then proceed to sanction the revised amount after due verification through the option provided in ICES, a detailed advisory on which will be communicated by DG Systems to all the System Managers shortly.
  • Once the revised amount is approved by the designated AC/DC in the system, a fresh scroll will be available for generation for the differential amount only.

Members please note that only those S/Bills which have already been scrolled shall be able to avail this facility. This facility can be used only once for each eligible S/Bills to sanction the revised IGST amount. Utmost care may be taken by the exporter while submitting the RRR as well as the sanctioning officer while sanctioning the revised amount as no further provision will be available for revising the refund sanction again.

Members may please make a note of the above and avail the facility extended by CBIC to rectify the errors in the S/Bills and also take the advantage of receiving of the balance refund amount granted by CBIC.

Thanking you,

Yours faithfully,