Refund can be withheld :

Can refund be withheld by the department?

Ans. Yes, refund can be withheld in the following circumstances:

i. If the person has failed to furnish any return till he files such return;

ii. If the registered taxable person is required to pay any tax, interest or penalty which has not been stayed by the appellate authority/Tribunal/ court, till he pays such tax interest or penalty;

The proper officer can also deduct unpaid taxes, interest, penalty, late fee, if any, from the refundable amount – Section 54(10) (d) of the CGST/SGST Act

iii. The Commissioner can withhold any refund, if, the order of refund is under appeal and he is of the opinion that grant of such refund will adversely affect revenue in the said appeal on

account of malfeasance or fraud committed – Sec.54 (11) of the CGST/SGST Act.