Integrated GST
“zero rated supply” means any of the following supplies of goods or services or both, namely:––
(a) export of goods or services or both; or
(b) supply of goods or services or both [for authorised operations] 1 to a Special Economic Zone developer or a Special Economic Zone unit.
1 Inserted vide Section 123 of Finance Act 2021. Made effective from 1.10.2023 vide Notif 1/2023-IT dated 31.7.2023
[A registered person making zero rated supply shall be eligible to claim refund of unutilised input tax credit on supply of goods or services or both, without payment of integrated tax, under bond or Letter of Undertaking, in accordance with the provisions of section 54 of the Central Goods and Services Tax Act or the rules made thereunder, subject to such conditions, safeguards and procedure as may be prescribed:
Provided that the registered person making zero rated supply of goods shall, in case of non-realisation of sale proceeds, be liable to deposit the refund so received under this sub-section along with the applicable interest under section 50 of the Central Goods and Services Tax Act within thirty days after the expiry of the time limit prescribed under the Foreign Exchange Management Act, 1999 for receipt of foreign exchange remittances, in such manner as may be prescribed.] 1
1 Substituted for "A registered person making zero rated supply shall be eligible to claim refund under either of the following options, namely:––
(a) he may supply goods or services or both under bond or Letter of Undertaking, subject to such conditions, safeguards and procedure as may be prescribed, without payment of integrated tax and claim refund of unutilised input tax credit; or
(b) he may supply goods or services or both, subject to such conditions, safeguards and procedure as may be prescribed, on payment of integrated tax and claim refund of such tax paid on goods or services or both supplied, in accordance with the provisions of section 54 of the Central Goods and Services Tax Act or the rules made thereunder."
vide Section 123 of Finance Act 2021. Made effective from 1.10.2023
[The Government may, on the recommendation of the Council, and subject to such conditions, safeguards and procedures, by notification, specify––
(i) a class of persons who may make zero rated supply on payment of integrated tax and claim refund of the tax so paid [in accordance with the provisions of section 54 of the Central Goods and Services Tax Act or the rules made thereunder] 2;
(ii) a class of goods or services [or both, on zero rated supply of which, the supplier may pay integrated tax and claim the refund of tax so paid, in accordance with the provisions of section 54 of the Central Goods and Services Tax Act or the rules made thereunder] 3 ] 1
1 Inserted vide Section 123 of Finance Act 2021. Made effective from 1.10.2023
2 Inserted vide Section 153 of the Finance (No. 2) Act, 2024 dated 16.08.2024 . Made effective from 1.11.2024 vide Notf. 17/2024-CT dated 27.09.2024
3 Substituted vide Section 153 of the Finance (No. 2) Act, 2024 dated 16.08.2024. Made effective from 1.11.2024 vide Notf. 17/2024-CT dated 27.09.2024 before it read as,
"which may be exported on payment of integrated tax and the supplier of such goods or services may claim the refund of tax so paid"
[Notwithstanding anything contained in sub-sections (3) and (4), no refund of unutilised input tax credit on account of zero rated supply of goods or of integrated tax paid on account of zero rated supply of goods shall be allowed where such zero rated supply of goods are subjected to export duty] 1
1 Inserted vide Section 153 of the Finance (No. 2) Act, 2024 dated 16.08.2024 . Made effective from 1.11.2024 vide Notf. 17/2024-CT dated 27.09.2024
