The Central Board of Indirect Taxes and Customs (CBIC) has introduced a mechanism to verify the IGST payments for goods exported out of India. A circular issued by the Board in this regard on Monday amended the existing norms for claiming IGST refunds is fully automated as provided under Instruction 15/2017-Cus dated 09.10.2017.
The circular empowers the Customs Officers to conduct a thorough enquiry on all the risky or suspicious refund claims of exporters and to reject such claims of exporters who are adopting malpractices.
“It has come to the notice of the Board that instances of availment of IGST refund using fraudulent ITC claims by some exporters have been observed by various authorities. Exporters have availed ITC on the basis of ineligible documents or fraudulently and utilized that credit for payment of IGST on goods exported out of India. It has also been observed in several cases that there is huge variation between the FOB value declared in the Shipping Bill and the Taxable value declared in GST Return apparently to effect higher IGST payout leading to encashment of credit,” the Board said in the circular.
The amended procedure includes guidelines for identification of suspicious cases, inserting Alert in the System, Examination of the export goods, Suspension of IGST refunds, Verification by GST formations and Action to be taken by customs formations on receipt of verification report from GST formations.
As per the circular, the DG (Systems) shall work out the suitable criteria to identify risky exporters at the national level and forward the list of said risky exporters to Risk Management Centre for Customs (RMCC) and respective Chief Commissioners of Central Tax. DG (Systems) shall inform the respective Chief Commissioner of Central Tax about the past IGST refunds granted to such risky exporters (along with details of bank accounts in which such refund has been disbursed).
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