Indirect Tax Laws and Practice · GST Refunds - Inverted Duty Structure and Zero Rated Supplies

Refund of IGST Paid on Exports under Rule 96

Updated 11 October 2026 · Fact-checked

When you export goods on payment of IGST, Rule 96 treats your shipping bill as the refund application. Once the export manifest is filed and you have filed a valid GSTR-3B, Customs processes the claim and credits the IGST paid to your bank account. Exports of services need a separate FORM GST RFD-01 application.

Understand Refund of IGST Paid on Exports

Exports are zero rated. An exporter can supply goods or services in two ways: without payment of tax under a bond or Letter of Undertaking, or with payment of integrated tax and then claim a refund. This topic covers the second route, export with payment of IGST.

For goods, the law makes refund almost automatic. Under Rule 96(1), the shipping bill filed by an exporter of goods is deemed to be an application for refund of the integrated tax paid. You do not file a separate form.

The deemed application is treated as filed only when the conditions are met. The person in charge of the conveyance must file a departure manifest, export manifest or export report covering the shipping bill numbers and dates. The applicant must also have furnished a valid return in FORM GSTR-3B and must have undergone Aadhaar authentication under Rule 10B.

The data flows between systems. The export invoice details in FORM GSTR-1 go from the common portal to the Customs system. Customs confirms that the goods were exported. After the portal informs Customs that a valid GSTR-3B was furnished, Customs processes the claim. The IGST for each shipping bill or bill of export is credited electronically to the bank account in your registration particulars, as intimated to Customs.

Services are different. A refund of IGST paid on services exported out of India is claimed by filing FORM GST RFD-01 on the common portal. It is dealt with under Rule 89.

Key rules to remember

Shipping bill as application: Shipping bill of exporter of goods = deemed refund application (Rule 96(1)); Applies to goods only. The application is deemed filed only when the conditions in clauses (a) to (c) are met.
Conditions for deemed filing: Departure/export manifest or export report filed + valid GSTR-3B furnished + Aadhaar authentication (Rule 10B); All three are needed. The manifest is filed by the person in charge of the conveyance, not by the exporter.
Mismatch proviso: Mismatch between Shipping Bill and GSTR-1 (as amended in GSTR-1A, if any) → application deemed filed on the date the mismatch is rectified; The claim is delayed, not rejected. The date moves to the rectification date.
Amount refunded: Refund = IGST paid on each shipping bill or bill of export (Rule 96(3)); Credited electronically to the bank account in your registration particulars, as intimated to Customs.
Services exports: Refund of IGST on services = FORM GST RFD-01, processed under Rule 89 (Rule 96(9)); No deemed application for services.
Upward price revision: Additional IGST on upward price revision after export = FORM GST RFD-01 under Rule 89 (proviso to Rule 96(1)); Only where IGST paid at export has already been refunded under Rule 96(3).
Withholding grounds: Withhold if: (a) request under section 54(10) or (11); (b) export violates Customs Act, 1962; (c) Board-authorised risk-based verification of exporter credentials, including ITC availment; Rule 96(4).

How to solve Refund of IGST Paid on Exports questions

Use this order for any question on refund of IGST paid on exports.

1Identify what is exported: goods or services. Goods use the shipping bill route; services use FORM GST RFD-01.
2Confirm the export was made with payment of IGST, not under bond or LUT.
3For goods, check the deemed-filing conditions: manifest or export report filed, valid GSTR-3B furnished, Aadhaar authentication done.
4Check for a mismatch between the shipping bill and GSTR-1. If there is one, move the filing date to the date of rectification.
5Check the withholding grounds in Rule 96(4). If any applies, state that the refund is withheld and, under clauses (a) and (c), is transmitted to the GST officer in a system-generated RFD-01.
6If no ground applies, state that Customs processes the claim and credits the IGST per shipping bill to the bank account.
7Close with a clear conclusion: refund allowed, delayed or withheld, with the reason.

Quickest way: Four-check test for export IGST refund

When to use it: Use in MCQs and short case scenarios where you must decide whether and when the refund is paid.

Goods or services? Goods: no separate application. Services: RFD-01.
Is the manifest or export report filed and the GSTR-3B valid?
Does shipping bill data match GSTR-1?
Is any Rule 96(4) withholding ground present?

Common mistakes in Refund of IGST Paid on Exports

Saying the exporter of goods must file FORM GST RFD-01 for IGST paid on exports.
Students carry over the general refund process of Rule 89.
Fix: For goods, the shipping bill is the deemed application. RFD-01 is for services and for additional IGST on upward price revision.
Applying the shipping-bill route to exports of services.
The heading says 'exports', so students treat goods and services alike.
Fix: Rule 96(9) requires RFD-01 for services, dealt with under Rule 89.
Treating a mismatch between shipping bill and GSTR-1 as a ground for permanent rejection.
Students confuse delay with denial.
Fix: The application is deemed filed on the date the mismatch is rectified.
Forgetting that the application is deemed filed only after the manifest, a valid GSTR-3B and Aadhaar authentication.
Students focus only on the shipping bill filing date.
Fix: Check clauses (a) to (c) of Rule 96(1) before fixing the filing date.
Mixing up the route: claiming this refund where goods were exported under LUT without tax.
Both are zero-rated routes and sound similar.
Fix: Rule 96 is for IGST actually paid. Exports without payment of tax lead to a refund of unutilised ITC instead.

Worked examples

Example 1

Sharma Textiles Ltd, Surat, exported garments and paid IGST of ₹4,50,000 on shipping bill SB-101. The export manifest was filed, GSTR-3B was furnished and Aadhaar authentication is complete. Data in the shipping bill and GSTR-1 match. No withholding ground exists. Explain how Sharma Textiles gets the refund.

Show the solution

Goods were exported with payment of IGST, so Rule 96 applies.
The shipping bill is deemed to be the refund application under Rule 96(1). No RFD-01 is needed.
The manifest, GSTR-3B and Aadhaar conditions are met, so the application is deemed filed.
GSTR-1 export invoice details go to the Customs system, which confirms the export.
With no mismatch and no Rule 96(4) ground, Customs processes the claim under Rule 96(3).

Answer: ₹4,50,000 is credited electronically to the bank account in Sharma Textiles' registration particulars, as intimated to Customs. It files no separate refund application.

Example 2

Kaveri Software Pvt Ltd, Bengaluru, exported software services and paid IGST of ₹2,70,000. A colleague says the refund will be processed automatically from the shipping bill. Is this correct? Also, what happens if a goods exporter's shipping bill does not match its GSTR-1?

Show the solution

Kaveri exports services. The shipping bill deemed-application route covers only goods exporters.
Under Rule 96(9), the refund of IGST on services exported is claimed by filing FORM GST RFD-01 on the common portal.
That application is dealt with under Rule 89.
For a goods exporter with a mismatch, the proviso to Rule 96(1)(b) applies.
The application is deemed filed on the date the mismatch is rectified by the exporter.

Answer: The colleague is wrong. Kaveri must file FORM GST RFD-01, processed under Rule 89, to claim ₹2,70,000. A goods exporter with a mismatch gets its deemed application filed only on the date of rectification.

Exam tips

In MCQs, the trigger phrase 'shipping bill' points to goods exports under Rule 96(1). 'Services' points to RFD-01.
Learn the three deemed-filing conditions as a set: manifest or export report, valid GSTR-3B, Aadhaar authentication.
In case studies, check for a mismatch or a withholding ground before concluding the refund is payable.
Write the rule number with the sub-rule, such as Rule 96(3) for credit to the bank account, to show precision.
Do not add Rule 96 timelines or figures that are not in the text. Stick to the conditions and flows.

Practice questions from GST Refunds - Inverted Duty Structure and Zero Rated Supplies

Refund of IGST Paid on Exports in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

CA FinalRefund of Export Duty (Section 26)

Refund of IGST Paid on Exports: frequently asked questions

Do I need to file a separate refund application for IGST paid on export of goods?

No. Under Rule 96(1), your shipping bill is deemed to be the refund application. It is deemed filed once the manifest or export report is filed, a valid GSTR-3B is furnished and Aadhaar authentication is complete.

How do I claim a refund of IGST paid on export of services?

File FORM GST RFD-01 electronically on the common portal. It is dealt with under Rule 89, as provided in Rule 96(9).

When can the export refund be withheld?

Rule 96(4) lists three grounds. These are a request under section 54(10) or (11), a Customs finding that the goods were exported in violation of the Customs Act, 1962, and a Board-authorised risk-based need to verify the exporter's credentials, including ITC availment.

What if the shipping bill data differs from GSTR-1?

The application is deemed filed only on the date you rectify the mismatch for that shipping bill. The refund is delayed, not lost.