Central Goods and Services Tax (Fourth Amendment) Rule, 2021

CBIC vide its Notification No.15/2021-Central Tax dt. 18.05.2021 issued Central Goods and Services Tax (Fourth Amendment) Rule, 2021 (“Amendment Rules” for short) to carry out the following amendments in the Central Goods and Services Tax Rules, 2017 (“CGST Rules” for short):

In case the registration of the registered person is cancelled by the department on its own motion then Rule 23(1) of the CGST Rules, provides the opportunity to the registered person to file the application for revocation of cancellation. Earlier revocation application could be filed within 30 days from the date of service of cancellation order. Consequent to the amendment, now the Additional Commission or Joint Commissioner or Commissioner are empowered to extend the said time limit of 30 days.

As per section 54(1) of the Central Goods and Services Tax Act, 2017 (“CGST Act” for short), a registered person has to the file the refund claim within 2 years from the relevant date. Further, in case the deficiencies are highlighted by the department in the said refund application, the registered persons are required to file the fresh refund application after rectifying the deficiencies. However, in certain instances it was observed that the rectified refund application if filed after the limitation period of 2 years, were rejected by the department. Now, the amendment have been made in Rule 90 of the CGST Rules and the time period from the date of filing the refund application upto the date of communication of deficiencies in FORM RFD-03 has now been excluded in calculating the limitation period of 2 years.

Sub rule (5) has been inserted in Rule 90 of the CGST Rules and the registered persons have now been provided with the opportunity to withdraw their refund application. To withdraw the refund claim, an application for withdrawal has to be made in FROM RFD-01W by the registered person at any time before issuance of provisional refund sanction order or final refund sanction order or refund payment order or refund withhold order or issuance of notice by the department. Once, the withdrawal application is filed in FORM RFD-01W, the amount of ITC which was initially debited from the electronic credit ledger of the registered applicant at the time of filing refund application in FORM RFD-01, shall now be recredited in the electronic credit ledger.

FORM RFD-07 in which refund order is being issued by the department, has now been revised. In revised FORM RFD-07, Part A is for the Order for Withholding of Refund Claim and Part-B is for Order to Release the Withheld Refund Claim. Corresponding amendments have been made in Rule 92(2) and 96(6) of the CGST Rules.

Written by: CA Palash Sharma
M/s Palash Sharma & Associates
Contact No. 9782115992
Email: [email protected]

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