Determination of Place of supply of Goods imported into, or exported from Indian [ Section - 11 of IGST, 2017 ] - GST Ready Reckoner - GST

Determination of Place of supply of Goods imported into, or exported from India Section 11 of IGST Act prescribes the provisions for determining the place of supply of goods in international transactions, i.e. outside from/to India. S. No. Section Nature of Supply of goods Place of Supply GST 1 11(a) Import of goods into India Location of Importer. Always IGST is charged for imports. 2 11(b) Export of goods from India Location of outside of India. GST on exports are eligible for refund. All imports will be deemed as inter-State supplies for the purposes of levy of GST. IGST is leviable on imports in addition to other duties of customs. Full set-off will be available as ITC of the IGST paid on import on goods and services. The IGST can be paid by utilizing ITC to the extent available and balance by cash. The use of ITC for payment of IGST will be done in the following order: ITC of IGST shall be used for payment of IGST first; Once ITC of IGST is exhausted, the ITC of CGST shall be used; If ITC of both IGST and CGST are exhausted, ITC of SGST shall be used. Remaining IGST liability shall be discharged in cash. GST System will ensure maintenance of this hierarchy for payment of IGST using the credit. However, IGST on imports has to be paid in cash only. Provisions relating to refund are contained in section 54 of the CGST Act, 2017 It provides for refund of tax paid on zero-rated supplies of goods or services or on inputs or input services used in making such zero-rated supplies, or refund of tax on the supply of goods regarded as deemed exports, or refund of unutilized input tax credit. Identical provisions exist under the IGST Act, 2017 and relevant SGST/UTGST Acts. Also, whenever an Indian entity raises an invoice in foreign currency, it can charge GST in foreign currency. However, you have to show the INR conversion rate and the INR values. Suppose you have raised in US Dollars (USD), then you can charge GST in USD. Also, you have to show the USD to INR conversion ratio and invoice values in INR. Examples - Import of goods Example 1:- M/s Brubery having principal place of business in Noida, U.P., places an import order on ABC Inc. England and goods, after clearing at Kandala port, Gujarat, and goods are delivered at place of business in Mumbai without any further movement In this case, there would be two supplies First supplies between ABC Inc, England to M/s Brubery, Noida, U.P. Place of supply of goods: - M/s Brubery, Gujarat Nature of transaction: - Inter-state supply (import) Second supplies between M/s Brubery, Noida, U.P. to M/s Brubery, Gujarat Place of Supply of goods : - M/s Brubery, Noida, U.P Nature of Transaction: - Inter-state supply Example 2:- Penta Pvt. Ltd. imports electric kettles from China for its Kitchen Store in Noida, Uttar Pradesh. Penta Pvt. Ltd. is registered in Uttar Pradesh. Place of supply of goods :- Noida, Uttar Pradesh. Nature of Transaction : - Inter-state supply. Example 3:- Rajesh electric Pvt. Ltd. imports electric kettles from China and sale imported goods before entering the border of India to ABC Inc Germany. Place of supply of goods:- Neither an Import Nor an Export Nature of Transaction: - Not applicable (High -sea sale) Reason:- Goods never enters into India or touches the Indian Territory Example Export of goods Example 1:- Indian spices Pvt. Ltd. (New Delhi) exports spices from New Delhi to London, UK. Place of supply of goods - London(Outside India) Nature of Transaction : - Inter-state supply. Example 2:- Ms. Anita (Kolkata), registered at Delhi. exports Indian perfumes to UK Place of supply of Goods :- UK (outside India) Nature of Transaction :- Inter State supply