A GST refund rejection is rarely cured by repeating that a refund is due. The reply must show why the claimed amount falls within the statutory refund category, how it is calculated, and why each objection in the notice is factually or legally incorrect. Where the claim concerns exports or accumulated input tax credit, the file should be built as though a person unfamiliar with the business must be able to follow it in one sitting.
Section 54 of the Central Goods and Services Tax Act, 2017 provides the refund framework. Rules 89 and 92 of the CGST Rules govern the application and adjudication record. If the officer proposes to reject any part of the claim, Rule 92(3) contemplates notice in FORM GST RFD-08, a reply in FORM GST RFD-09, and an order in FORM GST RFD-06 after considering the reply. This is not decorative paperwork. A refund file without a reliable document trail tends to acquire objections the way an unattended ledger acquires questions.
Identify the precise rejection ground
The taxpayer should first classify the objection: limitation, export realisation, turnover computation, ineligible input tax credit, mismatch in invoices, unjust enrichment, missing declarations, or a new ground that was never put in the notice. A response that answers the wrong objection may appear detailed yet achieve little.
For an export-related accumulated credit refund, the record may include the refund application and acknowledgement, RFD-08, relevant returns, statement of invoices, shipping bills or export service invoices, LUT where applicable, foreign inward remittance or bank realisation material, purchase register, input tax credit ledger, GSTR-2B and GSTR-3B reconciliation, computation worksheet, and proof that disputed invoices belong to the claimed period. Documents should be indexed and mapped to each allegation, not uploaded as a digital sack of papers.
Hearing and reasons matter
In M/s Chandni Crafts v. Union of India, D.B. Civil Writ Petition No. 5460/2020, decided on 17 January 2023, the Rajasthan High Court dealt with rejection of accumulated input tax credit refund claimed on exports under LUT. The Court held that Rule 92(3) required notice, reply and an opportunity of hearing before rejection, and set aside the rejection and appellate orders when that process was not followed. It also rejected the proposition that an appellate hearing cures denial of natural justice at the first stage.
That judgment does not dispense with proof of eligibility. It establishes that a refund claimant must receive a fair opportunity to answer the reasons for proposed rejection. A reply should therefore request a hearing where facts or reconciliations require explanation and should record any defect in the notice without withholding the substantive evidence.
Service Tax-era guidance, applied carefully
A useful analogous principle arises under the earlier Service Tax regime. In a decision authored by me, the Bench examined a refund rejection in Gartner India Research and Advisory Services P. Ltd. v. Commissioner of CGST, Mumbai East, CESTAT Mumbai, Final Order No. A/85521/2023 dated 5 April 2023. Part of the Service Tax refund had been rejected on a reason not contained in the show cause notice. The Bench held that rejection on that unnotified ground was unsustainable because the appellant had no opportunity to present its case.
GST refund eligibility remains governed by the CGST Act and Rules, not the earlier notification in Gartner India Research. The procedural lesson applies mutatis mutandis: a reply should identify whether RFD-08 contains every rejection basis later relied upon, and should object promptly if adjudication travels beyond the notice.
Three errors that weaken a refund reply
First, do not send reconciliations without underlying invoices and return extracts. Second, do not ignore a partial sanction: separate the accepted amount from the disputed amount so the response is precise. Third, do not treat a hearing request as a substitute for written proof; the hearing explains the record, it does not create it.
AGS Consulting assists businesses and counsel with refund rejection replies by reviewing the notice ground-by-ground, structuring the evidence file, and identifying procedural defects without overstating the merits. For a review of a GST refund notice and supporting documents, contact AGS Consulting.
FAQs
Is a hearing required before a GST refund claim is rejected?
Rule 92(3) provides that no refund application shall be rejected without giving the applicant an opportunity of being heard. The request should be made expressly in the reply where factual explanation is required.
Which documents are usually needed for an export refund reply?
The file commonly includes returns, invoice statements, export documents, LUT where applicable, realisation evidence, electronic credit ledger material and a return-to-invoice reconciliation tailored to the objection.
Can an officer reject a refund for a reason absent from RFD-08?
A rejection on an uncommunicated ground raises a serious natural justice objection because the applicant was not enabled to answer that case before the order was made.
Does Service Tax case law automatically govern GST refunds?
No. Earlier case law may assist on comparable procedural principles, but the GST claim must satisfy Section 54 and the applicable CGST Rules on its own facts.