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

Meru Engineering exported goods and received a refund of Rs 4,00,000 of integrated tax paid. Of the sale proceeds, 25% were not realised in India within the FEMA period and its extensions, and the RBI has not written off the requirement. Which statement is correct under Rule 96B?

Meru must deposit Rs 1,00,000, being 25% of the refund, with applicable interest within thirty days of the expiry of the FEMA or extended period. Rule 96B covers only the extent of non-realisation, and recovery proceedings apply if it fails to deposit.

  1. AIt must deposit Rs 1,00,000 with applicable interest within thirty days of expiry of the period, failing which recovery followsCorrect
  2. BIt must deposit the entire Rs 4,00,000 with interest, as part realisation is ignored
  3. CIt need deposit nothing unless a notice is issued first under section 73
  4. DIt must deposit Rs 1,00,000 within fifteen days of the invoice date

Explanation

Rule 96B(1) requires deposit of the refund to the extent of non-realisation: 25% of Rs 4,00,000 = Rs 1,00,000, with applicable interest, within thirty days of expiry of the FEMA or extended period. Failing this, recovery follows as for an erroneous refund. The full-refund option ignores 'to the extent'; the proviso to write-off does not apply here.

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