Alerts & Updates 11th Nov 2022
Since the inception of GST, provisions relating to inverted duty (ID) refund have been contentious. Recently, the formula for claiming ID refund was examined by the Hon’ble Supreme Court in UOI vs VKC Footsteps. The Apex Court observed anomalies in the said formula and urged the GST Council to reconsider and take a policy decision regarding the same.
Basis the observation, certain amendments were introduced in the GST law. Uncertainty existed with respect to the tax period to which such amendments apply. To address the said issue, GST Policy Wing of the CBIC issued clarifications through Circular No. 181 dated November 10, 2022.
In this GST update, we analyze the clarifications provided by the Circular. Although the Circular intended to clarify the position, it leaves more scope of ambiguity could possibly open doors to new rounds of interpretational dispute.