Tamil Nadu GST Dept Prescribes Re-Credit in Electronic Ledger using Form GST PMT-034 [Read Circular]

With reference to a circular issued on the recommendations of the GST Council, by CBIC, Department Of Revenue, and Ministry Of Finance, the Tamil Nadu GST Department prescribes re-credit in the electronic ledger of the taxpayer in cases of excess or erroneous credits sanctioned to them. This has been done via an insertion of the sub – rule (4B) in rule 86 of the Tamil Nadu Goods and Services Tax Rules, 2017 ( TNGST Rules), vide a notification by the Commercial Tax & Registration Department.

In order to ensure uniformity in the implementation of the above provisions of the law across field formations, the commissioner, in the exercise of the powers conferred by section 168 of the Tamil Nadu Goods & Services Act, 2017, has clarified that the following are the categories of refunds when sanctioned erroneously, a re-crediting can be done using FORM GST PMT- 03 A, on deposit of such erroneous refund along with interest and penalty, whenever applicable by the taxpayer:

1. Refund of IGST obtained in contravention of sub-rule (10) of rule 96
2. Refund of unutilized ITC on account of export of goods/services without the payment of tax.
3. Refund of unutilized ITC on account of zero-rated supply of goods/ services to SEZ developer/ unit without payment of tax.
4. Refund of unutilized ITC due to inverted tax structure.

In the course of repayment, the taxpayer is required to deposit the amount of erroneous refund along with the applicable interest and penalty, wherever applicable, through FORM GST DRC- 03. The taxpayer shall also clearly mention the reason for making payment in the text box as the deposit of erroneous refund utilized ITC, or the deposit of erroneous refund of IGST obtained in contravention of sub-rule ( 10) of rule 96 of the TNGST Rules.

Further, the taxpayer shall, till the time an automated functionality for handling the case is developed on the portal, make a written request in the format enclosed as Annexure- A, to the jurisdictional proper officer to re- credit the amount equivalent to the amount of refund thus paid back through FORM GST DRC- 03, to the electronic credit ledger.

On being satisfied with the receipt of the full amount of the erroneous refund, the applicable interest as per the provisions of section 50 of the TNGST Act, and the applicable penalty by the said registered person in FORM GST DRC -03, the proper officer shall re-credit the amount equivalent to the amount of the erroneous refund in the electronic cash ledger, and shall pass an order in FORM GST PMT -03A, within 30 days from the date of receipt of the request for re-credit or the date of payment of the full amount of the erroneous refund with the applicable interest and penalty, whichever is later.

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