Post Audit & review of Refund orders - Instructions issued

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The CBIC vide Instruction No. 03/2022-GST has instructed GST officials to upload Speaking Order along with GST Refund sanction order in FORM GST RFD-06 and also specified that Post-Audit may be conducted within 3 months from issue of FORM GST RFD-06 order for GST Refund claims exceeding Rs. 1 Lakh.

So, claims less than Rs. 1 lakh does not require post Audit review.

One may recollect that  detailed guidelines for processing of refund claims in GST were already issued by the Board vide Circular No. 17/17/2017 —GST dated 15.11.2017 (for manual processing of refunds) and Circular No. 125/44/2019-GST dated 18.11.2019 (for electronic filing and online processing of refunds) to ensure uniformity in processing of refund claims. 

In both of these Circulars, it has been mentioned that the proper officer shall follow the principle of natural justice before taking the final decision with regard to refund claim. 

Principle of natural justice inter-alia provides that a detailed speaking order needs to be issued providing a basis for sanction/rejection of refund. Therefore, while passing the refund sanction order in FORM GST RFD-06, the proper officer should also upload a detailed speaking order along with refund sanction order in FORM GST RFD-06.

ACES-GST portal provides the facility for uploading a document in pdf format along with the FORM GST RFD-06 order. The same may be utilized by proper officer for uploading the speaking order along with refund sanction order in FORM GST RFD-06 so that the same is made available to the refund applicant as well as Post-audit/Reviewing Authority online.

One may be aware that Sub-section (2) of section 107 of the CGST Act 2017 provides that the Commissioner may examine any decision or order, including an order of refund, with respect to its legality or propriety and he may direct any officer subordinate to him to file an appeal against the said decision or order within 6 months of the date of communication of the said decision or order.

Accordingly, as per extant practice, all refund orders are required to be reviewed for examination of legality and propriety of the refund order and for taking a view whether an appeal to the appellate authority under provisions of sub-section (2) of section 107 of the CGST Act is required to be filed against the said refund order.

Therefore now it has been advised that the post-audit should be concluded within 3 months from the date of issue of FORM GST RFD-06 order. 

The findings of the post-audit shall be communicated to the review branch within the said time period of 3 months. 

The review of refund order shall be completed at least 30 days before the expiry of the time period allowed for filing appeal under Section 107(2) of the CGST Act 2017.

Till the time the functionality for conducting post-audit online is developed on ACES­GST portal, post-audit of refund orders may be conducted in offline mode.

For this, the relevant documents may be provided to the post-audit cell by the concerned Division through e-Office within 7 days of issuance of refund sanction order in FORM GST RFD-06.

Atlast!!!.... We have a SoP to be followed for the sake of uniformity which is good


SRIVATSAN.R.

MEPZ-SEZ,

Chennai

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