Despite the insertion of Rule 89(4A) & 89(4B), numerous Advance Authorisation (AA) holders and Export-Oriented Unit (EOU), either due to a lack of awareness or enticed by the simplicity of Rule 89(4), have erroneously filed refund claims and obtained refunds from the GST department. In strict compliance with the law, such claims ought to have been submitted under Rule (“u/r”) 89(4A) or 89(4B).
 
Recently, the GST authorities have initiated actions to address these erroneous refunds. Notices have been issued to exporters/taxpayers demanding the recovery of refunds along with applicable interest and penalties. In this article, our partner, CA Jignesh Kansara, delves into the intricacies of Rule 89(4B), examines the repercussions of incorrect refund claims made u/r 89(4) and outlines the recommended course of action for affected taxpayers.

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