Exports are zero-rated under GST. This means exporters don’t pay tax on goods they export — but what about the input GST they paid on purchases? That’s where refunds come in.
This blog explains the refund process, two methods, documents needed, and what to do if refund is not credited or delayed.
Table of Contents
Two Ways to Export Goods & Claim GST Refund on Export of Goods
1. Export Under LUT (Without Payment of IGST) – Refund of ITC
- Export is done without charging any tax on the invoice.
- You can claim refund of unutilized Input Tax Credit (ITC).
- You must submit a Letter of Undertaking (LUT) in GST RFD-11 through the portal.
- You must file GST RFD-01 to claim refund.
Example:
ABC Ltd. exports goods to the US under LUT. It pays GST on raw materials but not on export invoice. It can claim refund of that ITC.
2. Export With Payment of IGST – Refund of IGST Paid
- Goods are exported by charging IGST.
- Refund is processed automatically via ICEGATE (customs system) after filing GSTR-1 and GSTR-3B properly.
- No separate refund application is required.
Example:
XYZ Pvt. Ltd. exports machines and charges IGST. Once returns are filed and customs clears export, refund is auto-credited.
Documents Required for GST Refund
- Shipping Bill
- Export Invoice
- LUT Copy (if export under LUT route)
- GSTR-1 and GSTR-3B returns
- FIRC/BRC (for foreign inward remittance)
- Refund application in Form RFD-01 (in case of ITC refund)
If Refund is Not Credited – Step-by-Step Actions
1. Check for Mismatches
- Ensure invoice number, date, and taxable value match exactly in:
- GSTR-1
- GSTR-3B
- Shipping Bill
Even small mismatches block refunds.
2. FIRC/BRC Submission
- Submit proof of receipt of export proceeds (FIRC/BRC).
- Refund is often kept on hold until payment proof is uploaded.
3. Check GSTR-3B Filing
- Export turnover must be properly disclosed in Table 3.1(b).
- Mismatch with GSTR-1 may delay refund.
4. Deficiency Memo Response
- If department issues a deficiency memo (GST RFD-03), correct the issues and re-file RFD-01.
- Refund processing starts fresh from re-filing date.
5. Contact ICEGATE Helpdesk (for IGST Refund)
- Raise a grievance at www.icegate.gov.in in case refund is stuck.
- Provide:
- Shipping Bill Number and Date
- Invoice and GST return details
- Export proof
6. Approach GST Officer
- For ITC refund delays beyond 30–45 days, raise a grievance on GST portal or contact your jurisdictional officer with ARN and documents.
Common Reasons for Refund Rejection
| Reason | Solution |
|---|---|
| Invoice mismatch between GSTR-1, 3B, and shipping bill | Reconcile and correct via amendments |
| LUT not filed or expired | File fresh LUT every year |
| Claim filed after 2-year time limit | Refund not allowed beyond 2 years |
| Missing FIRC/BRC | Submit immediately |
| No actual export as per customs (no EGM filed) | Ensure EGM is filed by CHA or shipping line |
Time Limits for GST Refund
| Type | Time Limit |
|---|---|
| ITC Refund (under LUT) | Within 2 years from date of shipping |
| IGST Refund | Auto-processed but corrections must be done within 2 years |
Key Legal Provisions
| Law | Purpose |
|---|---|
| Section 16 of IGST Act | Export is zero-rated |
| Rule 96 of CGST Rules | IGST refund process |
| Rule 89 of CGST Rules | Refund of ITC under LUT |
| RFD-01 | Refund application form |
| RFD-03 | Deficiency Memo format |
Real Case Example
DEF Exports had an IGST refund of ₹4.8 lakh pending for three months.
Issue: Invoice value mismatch between GSTR-1 and shipping bill.
Solution: Amended GSTR-1 using Table 9A. Raised ICEGATE grievance. Refund was processed in 20 days.
Best Practices to Avoid Refund Delays
- File LUT every financial year before exporting.
- Match invoice details in GSTR-1, GSTR-3B, and shipping bill.
- Submit FIRC/BRC immediately after foreign remittance is received.
- Keep all records scanned and ready.
- Reconcile returns monthly to avoid errors at year-end.
Conclusion
GST refund on export of goods is essential for preserving your working capital. But a single mismatch can delay or block it. Timely filing, proper documentation, and following up with ICEGATE or GSTN helpdesks can speed up your refunds significantly.
Contact taxgiveindia.com for filling returns services accurately.