Can You Claim TDS/TCS Refund from the GST Cash Ledger?
If you’re a registered supplier or deductor wondering whether TDS TCS refund in GST cash ledger is possible under Indian GST law — here’s your answer: Yes, but with conditions.
The Central Board of Indirect Taxes and Customs (CBIC) clarified this in Circular No. 190/02/2023-GST dated 13th January 2023, putting an end to doubts faced by many businesses and tax professionals.
Legal Background: What Do Sections 51 & 52 Say?
- Section 51 of CGST Act: Mandates deduction of TDS by government departments, local authorities, or notified bodies while making payments to suppliers.
- Section 52 of CGST Act: Deals with TCS collected by e-commerce operators when suppliers sell goods/services via their platforms.
CBIC Clarification: Yes, Refund Is Allowed
According to CBIC Circular 190/02/2023, any TDS or TCS deposited in the electronic cash ledger under Section 51 or 52 can be claimed as refund under Section 54(1) of CGST Act, if it remains unutilised.
Key conditions:
- The refund should be claimed as “excess balance in electronic cash ledger”.
- There is no time limit (i.e., no two-year bar) to file such a refund application.
How to Claim TDS/TCS Refund from Cash Ledger?
Follow these steps:
- Login to GST portal
- Go to Services > Refunds > Application for Refund
- Choose “Refund of excess balance in electronic cash ledger”
- Select the tax head (e.g., TDS/TCS under IGST, CGST, SGST)
- Submit with relevant supporting details (if any)
- Track status via ARN
Common Confusion: Is Refund Different from TDS Credit?
Yes. Don’t confuse TDS/TCS credited to cash ledger with ITC under Section 41:
| Parameter | TDS/TCS in Cash Ledger | Input Tax Credit (ITC) |
|---|---|---|
| Credited To | Electronic Cash Ledger | Electronic Credit Ledger |
| Utilization For | Tax Payment or Refund | Output Tax Liability Only |
| Refund Allowed? | ✅ Yes (as excess cash balance) | ❌ Not unless conditions met |
| Section | 51 / 52 + 54(1) | 16, 17, 41 |
Legal Reference You Must Know
- Section 51 & 52 of CGST Act, 2017
- Section 54(1) of CGST Act – Refund of excess balance
- Rule 87 of CGST Rules – Electronic Cash Ledger
- CBIC Circular No. 190/02/2023-GST – Read here
Expert View: Refund Is a Right, Not a Favour
Filing under the correct category ensures quicker processing and avoids future disputes.
Key Takeaways
- File under “refund of excess balance in electronic cash ledger”, not under “refund of TDS”.
- No two-year limit applies.
FAQ: GST TDS/TCS Refund
Q1. Can a supplier claim TDS refund if not used for tax payment?
Yes. Claim it as excess cash balance via GST portal.
Q2. Is any CA certificate or documentary proof needed?
No. It is exempt from unjust enrichment clause under Section 54(1).
Q3. Is there a time limit to claim such refunds?
No. Refund of excess balance has no deadline under GST law.
Final Word
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Summary
Can TDS/TCS in GST cash ledger be refunded? Yes. CBIC clarified in Circular 190/2023 that such amounts can be claimed as refund of excess balance in electronic cash ledger under Section 54(1) of CGST Act, without time limit.