Ludhiana: Industry body seeks seven-day GST refunds

CICU Seeks Faster GST Refunds

The Chamber of Industrial and Commercial Undertakings (CICU), Ludhiana, has urged tax authorities to clear eligible GST refunds within seven days and to rationalise inverted duty structures. The demands were placed before officials during an interactive session held by CGST, Chandigarh Zone, on the outcomes of the 57th GST Council meeting. CBIC chairman Vivek Chaturvedi, member (GST) Sanjay Mangal and other senior officers were present. CICU’s export committee co-convenor and its administration handed over a memorandum to Mangal.

Why It Matters For MSMEs

The Chamber contends that delayed refunds and accumulated input tax credit (ITC) tighten working capital for manufacturers, especially MSMEs. Sectors such as bicycles and components, engineering goods, packaging, tractor parts and sewing machines face inverted duty structures, where inputs are taxed higher than finished goods. Funds thus stay locked in the tax system, limiting the ability to buy raw materials, pay wages and meet operating costs. CICU warned that higher borrowing costs and tax disadvantages could make imported finished goods more attractive than domestic products, potentially hurting investment and employment and weakening the Make in India and Atmanirbhar Bharat goals.

Recommendations And Concerns

CICU proposed a seven-day processing and release deadline for eligible refunds claimed by established, low-risk taxpayers, wherever legally feasible. It also sought an artificial intelligence-enabled automated refund mechanism, sector-wise GST rate rationalisation and uniform refund procedures across central and state administrations. The Chamber flagged professional charges of 5% to 10% of refund amounts in some cases as an added burden. It further asked for timely GST audits, protection for bona fide purchasers in ITC-related matters and stronger safeguards for taxpayer data confidentiality. CICU welcomed the 57th GST Council’s automation initiatives and hoped the refor…