Breif Issue :

FACTS AND ISSUE OF THE CASE:

The Applicant though eligible to claim for refund of inverted duty structure under Section 54(3) of the CGST Act, wishes to understand the in-principle applicability of Notification 2l and 26 in as much whether the same allow for refund of ITC availed on input services (and remaining unutilized) in whole or part thereof.

Daewoo-TPL JV, a joint venture between M/s. Daewoo Engineering and Construction Company Limited and M/s. Tata Projects Limited (‘the Applicant’) is inter alia engaged in the business of designing, engineering and construction of Mumbai Trans Harbour Link Project (‘MTHL Project’).The Applicant is a job worker providing its services at outward taxability @ 12% GST. For the purchase of raw material and other inputs required to execute the project, the Applicant pays 18% and 28% GST on inputs and capital goods;

As per Section 54(3) of the CGST Act, 2017 (‘the Act’), a registered person is eligible to claim refund of accumulated ITC in case the rate of GST on inputs is higher than the GST Rate on outward supplies, subject to certain conditions.

As per Section 54(3) of the Act, benefit of refund of unutilised ITC is available in case of inverted duty structure. The benefit is extended on entire of such ITC whether it is on account of inputs, input services or capital goods

According to Section 54(3) of the Act read with Notification No. 21/2018 – C.T. (Rate) dated 18 April 2018 implies that the formula under Rule 89(5) of the Rules for Net ITC only considers ITC on inputs and not input services