20 January 2024
Hi, In the financial year 21.22, an Input Tax Credit (ITC) has been reversed in GSTR 3B as per the provisions of section 17(5) due to a misunderstanding. Consequently, the same amount was paid through DRC 03 in the financial year 22.23 during the annual return filing. This implies that the ITC has been reversed twice, and now there is a need to claim a refund through DRC 03 for the amount paid in FY 22.23. I kindly request your suggestions regarding the options available for DRC 03 and any relevant case laws pertaining to this matter.
06 July 2024
In your situation, where Input Tax Credit (ITC) has been reversed twice in different financial years and the amount was subsequently paid through DRC 03, you can proceed to claim a refund for the amount paid in FY 22-23. Here’s how you can approach this:
### Steps to Claim Refund through DRC 03:
1. **Reason for Refund:** - File DRC 03 on the GST portal with the reason specified as "Refund of excess payment made due to reversal of ITC twice". - Provide clear details explaining the circumstances that led to the double reversal and subsequent payment.
2. **Documentation:** - Attach supporting documents such as copies of GSTR 3B for both financial years showing the reversals, DRC 03 acknowledgment for the payment made in FY 22-23, and any other relevant records.
3. **Amount Calculation:** - Clearly mention the amount for which you are seeking a refund. This should match the amount paid through DRC 03 in FY 22-23.
4. **GST Portal Procedure:** - Log in to the GST portal and navigate to the DRC 03 section. - Fill out the form with accurate details, ensuring all fields are correctly populated as per the guidelines.
5. **Case Laws or Precedents:** - While there might not be specific case laws directly addressing every scenario, general principles of tax law apply, such as the right to seek refund of amounts paid in error or in duplicate. - Ensure your application is clear and well-supported by documentation to strengthen your case for refund.
### Suggestions:
- **Consultation:** - Consider consulting with a GST expert or tax advisor who can assist in preparing and submitting the DRC 03 refund application. - They can provide insights on any specific requirements or recent updates related to GST refunds.
- **Timely Submission:** - Submit the DRC 03 application promptly to initiate the refund process. Monitor the status regularly on the GST portal for any updates or requests from tax authorities.
- **Compliance:** - Ensure compliance with all GST rules and regulations during the refund process to avoid delays or complications.
By following these steps and ensuring all documentation is in order, you can effectively claim a refund for the amount paid through DRC 03 due to the double reversal of ITC. This approach will help rectify the unintended payment and facilitate the refund process through the GST portal.
CAclubindia
