Section 57 – Consumer Welfare Fund
Section 57 of CGST Act, 2017 – Consumer Welfare Fund
Updated on: February 2026 (as applicable till date)
Prepared by: Yours Tax Consultant
1. Purpose and Background of Section 57
Section 57 provides for the establishment of the Consumer Welfare Fund (CWF) under the CGST Act.
This Fund is a continuation of the concept of consumer protection that existed under earlier indirect tax laws, now integrated into GST.
2. Statutory Provision – Section 57
Section 57:
The Government shall constitute a Fund,
to be called the Consumer Welfare Fund,
and there shall be credited thereto,
in such manner as may be prescribed,
such amounts as may be specified by the Government.
3. Nature of Consumer Welfare Fund
The Consumer Welfare Fund is:
- A statutory fund
- Not part of general Government revenue
- Meant exclusively for consumer welfare activities
Amounts credited to the Fund are earmarked and cannot be used for other purposes.
4. Sources of Amount Credited to CWF
Amounts credited to the Consumer Welfare Fund include:
- Refund amounts hit by unjust enrichment under Section 54
- Amounts transferred under Section 53
- Any other amount specified by the Government
5. Link Between Section 57 and Unjust Enrichment
Section 57 is the final destination for amounts where:
- Refund is sanctioned but not payable to applicant
- Tax burden has been passed on to consumers
This ensures that:
- Taxpayer does not gain unjustly
- Consumers indirectly benefit
6. Utilisation of Consumer Welfare Fund
The Fund is utilised for:
- Consumer awareness programs
- Consumer education initiatives
- Protection of consumer interests
- Any other purpose notified by Government
Thus, CWF serves a social and welfare objective.
7. Section 57 Read with CGST Rules
Section 57 must be read with:
Rule 97 prescribes:
- Administration of the Fund
- Accounting and utilisation mechanism
8. Section 57 vs Section 53
Distinction:
- Section 53: Provides for transfer of amounts to CWF
- Section 57: Provides for creation and existence of CWF
Both sections operate together.
9. Practical Importance for Taxpayers
For taxpayers:
- Once amount is credited to CWF, refund claim ends
- No further right to reclaim such amount
- Strong unjust enrichment documentation is critical
Understanding Section 57 helps in strategic refund planning.
10. Related Provisions
11. Professional Insight
Section 57 ensures that GST refunds follow equity. Where the taxpayer cannot receive the refund, the law ensures that consumers—who ultimately bore the tax— are the indirect beneficiaries.
Disclaimer: This article is prepared based on the CGST Act, CGST Rules, notifications and prevailing legal position as applicable till date. Utilisation and administration of the Fund are subject to Government directions.
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