Q. GST REFUND APPLICATION

Question

In one particular month both sale & purchase were returned  and business was closed. As -ve output liability of GST1 is not picked in GST3B, tax was paid due to ITC reversal on purchase return. Now refund application has to be filed under "excess payment of tax" or under "any other reason"

Answer 1

Given the specifics of your situation, filing a refund application under "any other reason" seems more appropriate. This would allow you to provide a detailed explanation of the circumstances, including the closure of the business, the return of sales and purchases, the issue with negative output liability not being picked up in GSTR-3B, and the resulting tax payment due to ITC reversal on purchase return. It's crucial to document and explain these unique circumstances clearly in your refund application to support your claim.

Ensure that all relevant documentation, including GSTR-1 and GSTR-3B returns showing the negative output liability and the ITC reversal, is attached to your refund application. The detailed explanation and documentation will be key to substantiating your claim under the "any other reason" category.

Regards, CA. Praveen Sharma

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