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CA Final · Indirect Tax Laws · Refunds

Siddhi Pharma Ltd. received a sanctioned refund, but the amount could not be credited because the bank account details furnished were incorrect. The company took 12 days to furnish the correct details and have them validated. For computing interest under section 56, how does rule 94(2) treat these 12 days?

The 12 days are excluded from the period of delay. Rule 94(2)(b) leaves out any time the applicant takes to furnish correct bank details or validate them when the sanctioned refund could not be credited to the account given. No fifteen-day threshold or RFD-08 notice is needed for this exclusion.

  1. AThey are included in the period of delay because the refund was already sanctioned
  2. BThey are excluded from the period of delay under rule 94(2)(b)Correct
  3. COnly the first 15 days of such time are excluded, so none is excluded here
  4. DThey are excluded only if the officer issues a notice in FORM GST RFD-08

Explanation

Rule 94(2)(b) excludes any period of time taken by the applicant for furnishing correct bank account details or validating the details furnished, where the sanctioned refund could not be credited to the account furnished. This exclusion has no fifteen-day threshold and does not depend on an RFD-08 notice; those features belong to clause (a). So all 12 days are excluded.

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