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CA Final · Indirect Tax Laws · Import and Export Under GST

Meghna Exports Ltd received a refund of Rs 12,00,000 of unutilised ITC on export of goods. Total sale proceeds were Rs 80,00,000, of which Rs 20,00,000 were not realised within the FEMA period (no extension). Refund is proportional to value. The RBI has not written off the shortfall. What must it deposit under Rule 96B(1), excluding interest, and by when?

It must deposit Rs 3,00,000 with applicable interest within thirty days of the expiry of the FEMA period. Rule 96B(1) requires repayment only to the extent of non-realisation, and 20 lakh of 80 lakh is one quarter of the Rs 12,00,000 refund.

  1. ARs 3,00,000 within thirty days of the expiry of the FEMA periodCorrect
  2. BRs 12,00,000 within thirty days of the expiry of the FEMA period
  3. CRs 3,00,000 within fifteen days of the expiry of the FEMA period
  4. DRs 9,00,000 within thirty days of the expiry of the FEMA period

Explanation

Rule 96B(1) requires deposit of the refund to the extent of non-realisation, with interest, within thirty days of the expiry of the period. Amount = 12,00,000 x 20/80 = Rs 3,00,000. Check: 25% of proceeds unrealised, and 25% of 12,00,000 is 3,00,000. Rs 9,00,000 is the realised portion; full refund ignores the 'to the extent' wording.

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