What do you mean by zero rated supply? List the essential features of zero rated supply. Explain the procedure for claiming refund for zero rated supply.

Zero rated Supply - Section 16 of the Integrated Goods and Services Act, 2017 Zero Rated Supply shall be any of the following supplies of goods or services or both, namely; Export of goods or services or both; or Supply of goods or services or both to a Special Economic Zone Developer or a Special Economic Zone Unit. Essential Features of Zero rated supply: Zero rated supply connotes the situation where output as well as input tax effectively remains Nil. The exporter has been given an option to either pay Integrated Goods and Services Tax (IGST) on exports and claim refund or opts to export without payment of IGST under Letter of Undertaking (LUT) or bond. The inward supplies to the exporter are charged to normal tax but the exporter is entitled to avail input tax credit of such tax and can use it for other tax liabilities and the credit remaining utilized can be claimed as refund. Procedure to claim refund: Procedure to claim refund: Rule 96 & 96A of CGST Rules The exporters of goods and services can claim refund of Input Tax paid by them on Zero rated goods or services as follows: According to Rule 96A of CGST Rules an exporter may export the goods / services under a letter of undertaking without payment of GST and claim refund of unutilized Input Tax Credit. In this respect the exporter has to: Ensure that No GST is charged in the export - import. Submit proof of export and satisfy all other conditions prescribed. Claim Input Tax credit relates to the outward export supply. File form GST RFD-01 for claiming refund. The exporter may supply goods or services or both after payment of GST charged on tax invoice in INR meant only for GST purpose and their claim refund thereof. In this respect the Exporter has to file the Shipping Bill in respect of exports of goods / services and such application of refund is deemed to have been filed when: The person in charge of the conveyance crossing the exported goods file an export manifest or export report giving the number and date of shipping bills or bills of export; and The applicant furnishes a valid return in FORM GSTR-3 or FORM GSTR-3B, as the case may be. The details of the relevant export invoices in FORM GSTR-1 shall be electronically transmitted by the common portal to the designated system of customs where in return shall confirm that the goods covers by this proposed invoices have been exported out of India.