Maharashtra GST Authority Rejects Refund Eligibility Advance Ruling
The Authority for Advance Ruling cannot decide if you are eligible for a GST refund.
- Ruling
- NO.GST-ARA-52/2025-26/B- 112, Mumbai, dt. 09/06/2026
- Dated
- 09 Jun 2026
- Authority
- Authority for Advance Ruling
This page was written by Patron Accounting’s AI from the official release and reviewed before publishing. It explains the document in plain language. It is not the document itself. Where this page and the original differ, the original governs.
The short version
- Lucre International asked if they could claim GST refunds while using duty drawback.
- The Authority rejected the request entirely.
- Refund eligibility and calculations are outside the Authority's legal power.
In short
The company asked the Maharashtra Authority for Advance Ruling (AAR) if they could claim a refund of unused Input Tax Credit (ITC) while also taking a customs duty drawback. The Authority decided it did not have the power to answer this question. Under the GST law, the AAR is only allowed to rule on specific topics, and refund disputes are not among them.
What has changed
How it worked before
Businesses often hoped the AAR could provide certainty on complex refund eligibility issues to avoid future disputes with tax officers.
What has changed
The Authority confirmed that it cannot rule on refund claims. This means you cannot use the advance ruling process to get a pre-approved 'green light' for a refund application.
Who this affects
Exporters and businesses seeking clarity on GST refund eligibility or calculations.
An example
Imagine a textile exporter wants to know if they can claim a GST refund while also taking a duty drawback. They might think an advance ruling will protect them from a future tax audit. Based on this order, the Authority will simply refuse to hear the case. The exporter must instead file their refund claim through the standard GST portal and wait for the tax officer's decision.
What you should do
Do not file an advance ruling application for refund matters, as it will be rejected. This ruling only applies to the company that asked; it is not a general law. You must follow the standard refund application process and address any disputes through the regular assessment or appeal channels.
If you do nothing
If you file an application for a refund ruling, you will waste time and legal fees only to have the case dismissed. The Authority will not provide an answer, and you will still have to face the tax department's scrutiny during your regular refund filing. Relying on an informal opinion instead of the official refund process can lead to rejected claims and penalties.
The terms explained
- Input Tax Credit
- The tax a business pays on its purchases that it can use to reduce the tax it owes on its sales.
- Advance Ruling
- A formal decision from the tax authority on how GST law applies to a specific business situation.
- Duty Drawback
- A refund of customs duties paid on imported materials used to manufacture goods that are later exported.
The ruling in detail
Authority for Advance Ruling
M/s. LUCRE INTERNATIONAL
NO.GST-ARA-52/2025-26/B- 112, Mumbai, dt. 09/06/2026 · Maharashtra
Questions before the authority
- Can applicant claim refund of unutilized ITC under Section 54(3) for export under LUT?
- Can applicant claim such refund while also vailing customs-only duty drawback?
- Is the second proviso to Section 54(3) applicable when drawback excluded central tax?
Facts
The applicant is a registered exporter engaged in the export of goods from India. They sought an advance ruling regarding the admissibility of claiming a refund of unutilized input tax credit (ITC) under Section 54(3) of the CGST Act while simultaneously availing customs-only duty drawback.
Ruling
The Authority for Advance Ruling rejected the application in its entirety. It held that the questions raised by the applicant regarding the admissibility and calculation of refunds do not fall within the scope of matters on which an advance ruling can be sought under the Act.
Reasoning
The Authority examined the scope of Section 97(2) of the CGST Act, which defines the specific matters on which an advance ruling can be sought. It concluded that questions related to the admissibility of refunds and the calculation of refund amounts are not covered under the provisions of Section 97(2). Consequently, the Authority determined that it lacked the jurisdiction to provide a ruling on the questions raised and rejected the application as **not maintainable**.
Provisions relied on
- Section 97(2) of the CGST Act, 2017
- Section 54(3) of the CGST Act, 2017
For the practitioner
This order serves as a procedural reminder that the Authority for Advance Ruling is a **limited jurisdiction body**. It confirms that substantive tax refund disputes are outside the scope of the advance ruling mechanism. Practitioners should avoid filing applications for advance rulings on refund eligibility or calculation matters.
Source
This is a summary prepared from the published order, which is a scanned document. It is a reading aid and not the authority: where the two differ, the order governs. Verify every provision against the original before relying on it.
Original order: https://www.gstcouncil.gov.in/sites/default/files/AAR/7-gst-lucre_internationalrejectiion_order_in_case_of_lucre_international_1.pdf
Legibility of the scan, as read: high.
Prepared 11-10-2026.
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