Pending IGST, SGST, VAT refunds and risky exporters issues hitting industrialists badly

Ludhiana, August 1, 2019: Upkar Singh Ahuja, President and Pankaj Sharma, General Secretary, CICU (Chamber of Industrial and Commercial Undertakings) in a joint statement said that the industry is passing through a crucial time and struggling to survive in this hard times due to pending IGST, SGST and VAT Refunds.

They further said that the refunds are pending in entire Punjab and majority of the cases belong to the industrialists of Ludhiana. The Government should understand that this is not our profit or income. This is in fact our capital and we are even paying interest to banks upon this money, which is stuck with the state taxation department.”

Further, they said government has issued circular dated June 17, 2019, which has classified certain exporter as Risky Exporters without divulging the criteria. No question were raised about any transaction nor were they given any opportunity to explain if the government had any issues. They further said that there is no official communication till date to the exporters notifying them of any violation of the default for which they have been declared Risky. This is direct attack on the integrity & credibility of people who have been in the business for decades. Shipments are getting delayed due to the procedural hassles thereby incurring additional costs in the form of demurrage and detentions. Overseas customers are on the verge of cancelling the export orders due to delays.

The custom formations of the region have suspended all the Benefits (IGST refunds, DBK claims & MEIS) of the above Risky Exporters with effect from 17.06.2019. With the result the entire supply chain consisting mostly of MSME manufacturers has been blocked with regard to delay in payments and further supplies. Also all the shipments of above said Risky Exporters are being subjected to 100% physical examination by the customs department.

Saravjit Singh, Co-Convener of CICU Export Promotion Committee said that as per the Circular no 16/2019 the GST formation were supposed to give a report to the Chief Commissioner of Central tax with in 30days specifying clearly weather the amount of IGST paid/claimed/sanctioned as refund was in accordance with the law or not. Government authorities have all the data on their portal pertaining to the ITC of each and every Exporter even then they are asking for verification of the ITC/REFUNDS claimed thereby further delaying refunds.

They also said that a request letter will be sent to Union Finance Minister and Finance Minister, Punjab, GST Council, for releasing above refunds at the earliest possible.