Refund of tax wrongly paid which was discovered Subsequently
Section 77 of CGST Act – tax wrongfully collected and paid to Central Government or State Government. — (1) A registered person who has paid the Central tax and State tax or, as the case may be, the Central tax and the Union territory tax on a transaction considered by him to be an intra-State supply, but which is subsequently held to be an inter-State supply, shall be refunded and the registered person has to pay IGST on such supply for which no interest shall be required to be paid.
Section 19 of the IGST Act – The registered person who has paid IGST on the supply considered by him as inter-state supply, which is subsequently held as intra-state supply, shall be granted refund of such tax after payment of the CGST/SGST tax and no interest on IGST paid is required to be paid.
It has been clarified that the term “subsequently held” covers both cases where the inter-state or intra-state supply made by the taxpayer, is either subsequently found by the taxpayer himself or by the officer in any proceeding, scrutiny, assessment, audit, investigation as intra-state or inter-state respectively. The amount wrongly paid shall be refunded to the taxpayer provided he has paid the tax under the correct head.
Rule 89(1A) of CGST Rules prescribe the manner and condition for refund under the above mentioned sections:-
| s.no. | Particulars | Last date for claiming refund |
| 1. | Payment made by the taxpayer in the correct head before the date of issuance of notification no. 35/2021-CT, dated 24.09.2021 | Two years from the date of issue of notification i.e. 23.09.2023 |
| 2. | Payment in the correct head by the taxpayer after the date of issuance of notification no. 35/2021-CT, dated 24.09.2021 | Two years from the date of making the payment under correct head e.g. if the payment has been done on 22.10.2021 then 21.10.2023 |
