FIRC Need Not Match Each Transaction, Periodic Certificate Sufficient If Total Forex Benefit Proven: Delhi High Court

The Delhi High Court has held that a Foreign Inward Remittance Certificate (FIRC) need not correspond to each individual transaction and it may reflect a period as a whole, provided that the overall benefit being claimed is fully substantiated by the total foreign exchange remittance.FIRC is issued by bank as proof of international payments for exports.A division bench comprising justices Prathiba M. Singh and Shail Jain observed,“FIRCs need not match transaction by transaction and could even be on a periodic basis, so long as the total benefit that is being claimed by a party is fully supported by the foreign exchange which has been remitted to such party.”The development comes in a petition moved by an exporter of Ayurvedic cosmetic goods, challenging demand of Rs. 20,14,98,627/- along with interest and penalty of equivalent amount raised by the GST Department.The allegation of the CGST Department is that as per the bank statements of the Petitioner, lump-sum amounts have been credited in INR from its foreign branch, which does not corroborate with the invoice-wise/month-wise/year-wise export quantum of the Petitioner.The Department contended that Petitioner failed to submit proof of foreign remittance viz. Bank Realization Certificate (for foreign exchange realization) or FIRC (for foreign exchange realization) or any other document issued from the bank regarding the foreign remittances.Petitioner on the other hand contended that the only reasoning given by the Department is that FIRC and invoices are huge in number and the same cannot be reconciled.Under these circumstances, the Court was of the opinion that the matter deserves re-consideration.“The impugned order dated 31 January, 2025 is set aside. The Petitioner shall now appear before the Adjudicating Authority and a fresh notice for personal hearing shall be issued to the Petitioner,” the Court ordered and disposed of the matter.Appearance: Mr. Rajat Mittal, Mr. Suprateek Neogi, Ms. Krati Agrawal, Mr. Subham Kumar & Mr. Priyanshu, Advs for Petitioner; Mr. Anurag Ojha, SSC with Mr. Dipak Raj, Mr. Shashank Kumar, Mr. Karan Aggarwal & Ms. Priyatam Kumar, Advs for RespondentCase title: Transformative Learning Solutions Pvt Ltd v. Commissioner Central Goods And Service Tax Delhi East & AnrCitation: 2025 LiveLaw (Del) 1246Case no.: W.P.(C) 4987/2025Click here to read order

FIRC Need Not Match Each Transaction, Periodic Certificate Sufficient If Total Forex Benefit Proven: Delhi High Court

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