57th GST Council Recommends Further Refund Simplification and Clarity on Interest on Refund of Pre-Deposit

The 57th Meeting of the GST Council was held on October 08, 2026, in New Delhi, under the chairpersonship of the Union Finance & Corporate Affairs Minister, Smt. Nirmala Sitharaman. At the meeting, the GST Council made recommendations relating to process reforms, primarily covering registration, returns, refunds and adjudication; clarifications regarding the applicability of GST on supplies of certain goods and services; and other measures for trade facilitation and streamlining GST compliances.

Expediting and streamlining the refund process: For expediting and streamlining the refund process, the Council further recommended amendments in the CGST Act, 2017 and the CGST Rules, 2017, to inter-alia provide for:

• Amendment in refund application in FORM GST RFD-01, to capture the details in the said application in a system-readable format and dispense with the requirement of uploading scanned documents in case of refund claims pertaining to zero rated supply and inverted duty structure.
• Amendment in rule 89(4)(C) of the CGST Rules, 2017, to remove the restriction for maximum amount of turnover of zero-rated supply of goods, as 1.5 times the value of like goods domestically supplied.
• Amendment in section 54(14) of the CGST Act, 2017, to add an explanation that the threshold of Rs. 1000 shall be applicable in respect of total refund amount, i.e. the amount under CGST, SGST/UTGST and IGST taken together.

Interest on refund of pre-deposit: With a view to ensuring greater clarity and certainty on the interest payable on refund of pre-deposit paid for filing appeals, the Council recommended, –

• amendment in section 115 of the CGST Act, 2017, to make it a standalone provision in respect of the rate of interest applicable for the refund of such pre-deposit amount, and
• issuance of a circular to clarify issues regarding rate of interest on refund of pre-deposit.

The Press Release can be accessed at:  https://www.pib.gov.in/PressReleaseDetail.aspx?PRID=2320934&reg=48&lang=1