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CA Final · Indirect Tax Laws · Miscellaneous Provisions (GST)

Gupta Electricals, a registered person, removed goods in a month five months before the appointed day after paying duty under the existing law. Two goods lots were returned to its place of business after the appointed day: Lot 1 came back four months after the appointed day from Sharma, an unregistered buyer, and was identifiable to the proper officer. Lot 2 came back two months after the appointed day from Verma Retail, a registered person. Which statement is correct?

Gupta can claim refund of duty on Lot 1, returned by an unregistered person within six months and identifiable. Lot 2 was returned by a registered person, so that return is deemed to be a supply rather than giving a duty refund.

  1. AGupta is eligible for refund of duty on Lot 1, and the return of Lot 2 is deemed to be a supplyCorrect
  2. BGupta is eligible for refund of duty on both lots
  3. CGupta is eligible for refund on Lot 2 only, because it came back sooner
  4. DGupta is eligible for refund on neither lot, because duty refunds are not allowed after the appointed day

Explanation

Goods removed not earlier than six months before the appointed day and returned within six months by a person other than a registered person qualify for refund of duty if identifiable, which fits Lot 1. If returned by a registered person, the return is deemed a supply, which applies to Lot 2. Option B ignores this proviso.

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