The Government of West Bengal on September 11th 2024 issued a notification regarding the processing of refund application filed by the Canteen. A new procedure for the electronic submission and processing of refund applications by the Canteen Stores Department (CSD) has been outlined.
Background: Refund Entitlement for CSD
The Canteen Stores Department (CSD), under the Ministry of Defence, has been granted the right to claim a refund of fifty percent of the applicable State tax on inward supplies of goods. This provision is crucial for the CSD as it operates Unit Run Canteens and supplies goods to authorized customers. Originally, Trade Circular No. 43/2018 provided the manual procedure for these refunds until an online system was developed.
Introduction of Electronic Filing
As part of an ongoing effort to streamline and modernize tax processes, the West Bengal Goods and Services Tax Rules, 2017 (WBGST Rules) have been updated. A new rule, 95B, and FORM GST RFD-10A were introduced. This update means that the CSD can now file refund applications electronically, simplifying the process significantly.
Revised Procedure for Refund Applications
The following sections provide a comprehensive overview of the new procedure for filing and processing refund applications electronically:
1. Filing Refund Applications Electronically
Process:
- Form Required: CSD must use FORM GST RFD-10A for filing refund applications electronically on the common portal.
- Basis of Refund: Refund claims are based on the invoices of inward supplies received by CSD for subsequent supply to Unit Run Canteens or authorized customers.
Frequency of Filing:
- CSD is required to file refund applications quarterly.
- There is flexibility to club multiple quarters and financial years in a single application.
2. Requirements for Refund
To be eligible for a refund, the following conditions must be met:
- Source of Supplies: The inward supplies must be from a registered person and backed by a valid tax invoice.
- Supplier Compliance: The supplier must have filed their returns in FORM GSTR-1 and FORM GSTR-3B for the relevant tax period.
- Supporting Documents:
- Undertaking: A statement confirming that the goods are for subsequent supply.
- Declaration: An affirmation that no previous refunds have been claimed on the same invoices.
3. Relevant Date for Filing Refund
Refund applications must be submitted within two years from the last day of the quarter in which the supply was received. This timeline ensures that the CSD remains compliant with the statutory time limits for claiming refunds.
4. Processing and Sanctioning of Refund Claims
Steps Involved:
- Validation: The proper officer will verify GSTIN details on the common portal, ensuring that all requisite returns (FORM GSTR-1 and FORM GSTR-3B) are filed.
- Scrutiny: The officer will review FORM RFD-10A, along with FORM GSTR-3B and FORM GSTR-2B, to validate the refund claim.
- Refund Limits: The refund sanctioned cannot exceed 50% of the central tax, state tax, Union territory tax, and integrated tax paid on the supplies received by CSD.
- Invoice Validation: Only invoices validated against FORM GSTR-2B will be accepted. Previously claimed invoices will be flagged and excluded from the refund application.
- Order Issuance: The proper officer will issue the refund order in FORM GST RFD-06, including a detailed speaking order to explain the basis of the decision.
5. Manual Applications
For refund applications submitted manually before the update in WBGST Rules and before the new online functionality was made available, the procedures from Trade Circular No. 43/2018 will still apply. These manual applications will continue to be processed according to the previous guidelines.
The transition to an electronic system for filing refund applications marks a significant improvement in the efficiency and transparency of tax processes for the CSD. By adhering to the revised procedures and requirements, CSD can streamline their refund claims, ensure compliance, and manage their financial operations more effectively.
