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One free scan finds every outdated or missing driver and matches the right update for your exact hardware.Free scan · exact hardware matchIndia’s GST law treats exports of goods or services and supplies to Special Economic Zone (SEZ) units or developers as zero-rated. A registered exporter generally chooses between supplying under a bond or letter of undertaking (LUT) without paying integrated GST and claiming eligible unutilized input tax credit (ITC), or paying integrated GST on exported goods and claiming a refund under the applicable procedure. The route determines the paperwork: an LUT is required before a no-payment supply, while the shipping-bill refund process applies to goods, not automatically to services. Eligibility and filing details depend on current law and the exporter’s facts.
What zero-rated supply means for GST refunds
Section 16 of the Integrated Goods and Services Tax Act (IGST Act) defines exports of goods or services, and supplies to an SEZ unit or developer, as zero-rated supplies. Zero-rated does not simply mean that no GST-related amount can ever be recovered: the law permits input-tax credit for making zero-rated supplies, subject to restrictions under the Central Goods and Services Tax Act (CGST Act), and provides refund routes. It does not guarantee that every exporter can recover every tax amount. See section 16 of the IGST Act.
Which GST refund route applies to an export?
The two routes differ in what is paid at the time of supply and what refund is claimed. The integrated-tax-paid shipping-bill process described below is specifically for goods; do not assume it applies to exported services.
| Question | Bond or LUT, without integrated tax | On payment of integrated tax |
|---|---|---|
| What is paid on the zero-rated supply? | No integrated tax under this option. | Integrated tax is paid on the supply. |
| What refund is claimed? | Eligible unutilized ITC, subject to statutory conditions and calculation. | Refund of integrated tax paid, subject to the applicable procedure. |
| Key process or records | Bond or FORM GST RFD-11 LUT before supply; prescribed invoice endorsement; applicable refund evidence and electronic application. | For exported goods, the shipping-bill process, export confirmation, a valid return and matched export data. |
| Important boundary | Rule 96A deadlines and consequences apply; check the operative rule for the relevant filing date. | The shipping-bill deemed-application process described here is for goods and should not be generalized to services. |
The choice depends on the exporter’s eligibility, facts and available credits; neither route is universally better. The statutory options are in section 16 of the IGST Act.
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How the LUT route works—and when to arrange it
A registered person choosing to make a zero-rated supply without payment of integrated tax must furnish a bond or LUT in FORM GST RFD-11 to the jurisdictional Commissioner before making the supply. Rule 96A ties the undertaking to deadlines for exporting goods and receiving qualifying payment for exported services. If a deadline is missed and no extension applies, the rule provides for tax and interest consequences. Because the available CBIC rules text may not reflect later amendments, check the operative consolidated rule and any applicable extension rather than relying on an older version for a filing deadline. See rule 96A of the CGST Rules.
For a refund of unutilized ITC, the refund rules use a statutory formula based on zero-rated turnover, net ITC and adjusted total turnover. These defined terms matter: this is not automatically a refund of all input tax. The applicant must debit the electronic credit ledger by the amount claimed. The applicable refund application is filed electronically in FORM GST RFD-01; the category and supporting statement depend on the claim. See the refund provisions in the CGST Rules.
Which documents are needed for an export refund?
Prepare records for the route and supply type being claimed, then confirm the current refund category and supporting requirements on the GST portal. Refund rules provide for an electronic application in FORM GST RFD-01 for applicable categories and identify route-specific statements and evidence.
- Export invoice: Use the prescribed endorsement for the chosen route: “SUPPLY MEANT FOR EXPORT ON PAYMENT OF IGST” or “SUPPLY MEANT FOR EXPORT UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF IGST.” Check the applicable rule for other invoice particulars. See the invoice rules.
- Exported goods: Match the shipping-bill or bill-of-export number and date to the corresponding export-invoice number and date. The refund rules specify a statement containing these details.
- Exported services: Keep invoice numbers and dates, plus relevant Bank Realization Certificate (BRC) or Foreign Inward Remittance Certificate (FIRC) particulars.
- Unutilized ITC claim: Keep the prescribed statement of input and input-service invoices for the relevant period, reconcile the turnover and credit figures to the statutory formula, and account for the required debit from the electronic credit ledger.
- LUT route: Retain the FORM GST RFD-11 undertaking or reference and monitor the applicable rule 96A deadlines and any formally allowed extension.
The supporting statements and refund evidence are set out in the CGST refund rules. Exact portal fields and category requirements should be checked against current portal instructions.
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How the shipping-bill refund works for exported goods
For goods exported on payment of integrated tax, rule 96 treats the shipping bill as the refund application. It is deemed filed only when both conditions are met: the export manifest or report covering that shipping bill has been filed, and the applicant has furnished a valid return. The rules describe electronic exchange of export data between the common portal and Customs for export confirmation and refund processing. A shipping bill by itself does not complete those deemed-application conditions. This procedure is for exported goods; it is not a general refund mechanism for exported services. See rule 96 of the CGST Rules.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Narrow exception for exempt or non-GST goods
CBIC has clarified that a bond or LUT cannot be insisted upon for refund claims relating to exports without payment of integrated tax of exempt or non-GST goods. The clarification does not remove the ordinary LUT requirement for taxable exports made without payment of integrated tax, and other applicable legal requirements may still apply. Check the clarification and its limits in CBIC Circular No. 125/44/2019-GST and CBIC Circular No. 131/1/2020-GST.
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Export duty and other statutory restrictions can also affect ITC refunds. The general CBIC FAQ describes this limitation, but an older FAQ is not a substitute for current consolidated law: CBIC GST FAQ.
Check current rules before filing
GST rules, forms, portal workflow and refund processing can change. Confirm the operative consolidated law and live portal instructions for the filing date, and reconcile the claim to the exporter’s invoices, returns, export records and payment evidence. A general description cannot determine whether a particular export satisfies the statutory conditions or whether a particular claimant is eligible; that depends on the facts and current rules. Do not assume a refund or a processing time from older procedural material.
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