Refund Of ITC In Export – A Subject Open To Deliberation

Exports are one of the fundamental drivers for growth for any economy. Governments offer various incentives with the intent of reducing the tax burden of the exporters and also to achieve a competitive price-edge for their products in foreign markets. In India, the export incentive framework has been structured through duty exemption and remission schemes, which encompass the refund of taxes and Input Tax Credit (ITC). This framework is designed with the dual purpose of supporting the interests of exporters and honouring the commitments made to international organizations.

The Government of India introduced Section 16(3) of Integrated Goods and Service Tax Act, 2017 ("IGST Act") and Section 54(3) of Central Goods and Service Tax Act, 2017 ("CGST Act") read with their respective Rules for allowing "refund of ITC in case of export of goods without payment of tax". However, since the introduction of GST, there has been a significant change in how export turnover