Relevant Provisions
- Para 6 – Circular No. 125/44/2019-GST dated 18.11.2019
- Section 54 – CGST Act, 2017
- Rule 89 – CGST Rules, 2017
Goods and Services Tax Network (GSTN) has released an important advisory dated June 10, 2025, addressing a technical concern that was affecting taxpayers registered under the QRMP (Quarterly Return Monthly Payment) scheme during the refund filing process. This update relates to the system-level validation deployed on GST Portal in May 2025, which caused some unintended challenges for QRMP taxpayers.
Key Advisory Highlights
- System Validation Introduced
In May 2025, a new system validation was implemented to align refund processing with Para 6 of Circular No. 125/44/2019-GST. As per the circular, a refund application can only be submitted if all returns in FORM GSTR-1 and FORM GSTR-3B due before the refund application date have been filed. This requirement does not apply to composition taxpayer, non-resident taxable person or Input Service Distributer (ISD), who must instead file FORM GSTR-4 (along with FORM GST CMP-08), FORM GSTR-5 or FORM GSTR-6, as applicable.
- Issues Faced by QRMP Taxpayers
Following the implementation of this validation, Quarterly Return Monthly Payment (QRMP) taxpayers began experiencing system errors while filing refund claims. The system failed to recognize invoices uploaded through the Invoice Furnishing Facility (IFF) for the first two months (M1 and M2) of the quarter. Moreover, even when GSTR-1 for the previous quarter had been duly filed, the system was erroneously prompting taxpayers to file GSTR-1 for M1 and M2 of the ongoing quarter.
- Resolution Implemented
GSTN has confirmed that this issue has been resolved. QRMP taxpayers can now file refund applications for invoices where the corresponding GSTR-3B has already been submitted. Importantly, invoices furnished through IFF should only be included in refund applications if the GSTR-3B for the relevant period has also been filed.
Effect
This correction ensures a smoother refund process for QRMP taxpayers and reinforces compliance with existing legal provisions. It also highlights GSTN’s responsiveness to resolving system-level issues that hinder taxpayer experience and compliance.
Our Remarks
The recent fix by GSTN reflects a proactive approach to addressing unintended consequences of system enhancements. QRMP taxpayers must ensure they file all relevant returns before submitting refund applications and must avoid including IFF invoices if GSTR-3B for that period has not been filed. This development underscores the importance of staying updated with GST advisories to ensure hassle-free compliance and refund processing.
91 System Validation for Filing of Refund Applications on GST Portal for QRMP Taxpayers