Banks pay provisional VAT currently at the time of delivery of gold on the basis of ongoing market prices. When customer fixes the price of metal, Banks pay actual VAT on the maturity date of the Gold Loan. Banks must be allowed to set-off the excess provisional GST paid to the government against future fixation of prices. In case of excesspayment, the same should be refunded on Pan – India basis and not on the basis of States.

  1.  Banks may claim refund in accordance with the provisions of section 54 of the CGST Act, 2017.
  2. Interest is payable in such cases as provided in section 56 of the CGST Act, 2017.
  3. In this connection, section 60(5) of the CGST Act, 2017 may be referred to.

( FAQ 6: GEMS AND JEWELLERY)