Deemed Export benefit under Notfication No.47/2017 C.T dated 18.10.17, Goods and Services Tax - GST

[SURYAKANT MITHBAVKAR]

we have manufacturing machinery and supply to customer who is exporting the same (Deem Export)

Whether we have to charge GST full rate or supply without GST.

If without GST what procedure to adopt.

Pl advice.

Posts / Replies

[Rajagopalan Ranganathan]

Sir,

According to third proviso to Section 89 (1) of CGST Act, 2017 in respect of supplies regarded as deemed expor the refund application may be filed by

(a) the recipient of deemed export supplies; or

(b) the supplier of deemed export supplies in cases where the recipient does not avail of input tax credit on such supplies and furnishes an undertaking to the effect that the supplier may claim the refund.

The rate of IGST payable by a registered supplier to a registered recipient for export is 0.05 per cent subject to the conditions mentioned in Notification No. 40/2017-Central Tax (Rate) dated 23.10.2017.

The supplier of goods cannot supply the same without payment of gst.

[SURYAKANT MITHBAVKAR]

As per latest attached Notification No. 41 & 40 dated 23.10.17 issued by GST Council regarding Concessional Rate of GST i.e. 0.1% for sale by registered supplier (Intra State Supplies ) & 0.05% for sale by registered supplier (Inter state supplies) to a registered recipient (Exporter) of goods for exports subject to fulfilment of conditions laid down in notification as foolows.

(i) the registered supplier shall supply the goods to the registered recipient on a tax invoice;

(ii) the registered recipient shall export the said goods within a period of ninety days from the date of issue of a tax invoice by the registered supplier;

(iii) the registered recipient shall indicate the Goods and Services Tax Identification Number of the registered supplier and the tax invoice number issued by the registered supplier in respect of the said goods in the shipping bill or bill of export, as the case may be;

(iv) the registered recipient shall be registered with an Export Promotion Council or a Commodity Board recognised by the Department of Commerce;

(v) the registered recipient shall place an order on registered supplier for procuring goods at concessional rate and a copy of the same shall also be provided to the jurisdictional tax officer of the registered supplier;

(vi) the registered recipient shall move the said goods from place of registered supplier –

(a) directly to the Port, Inland Container Deport, Airport or Land Customs Station from where the said goods are to be exported; or

(b) directly to a registered warehouse from where the said goods shall be move to the Port, Inland Container Deport, Airport or Land Customs Station from where the said goods are to be exported;

(vii) if the registered recipient intends to aggregate supplies from multiple registered suppliers and then export, the goods from each registered supplier shall move to a registered warehouse and after aggregation, the registered recipient shall move goods to the Port, Inland Container Deport, Airport or Land Customs Station from where they shall be exported;

(viii) in case of situation referred to in condition (vii), the registered recipient shall endorse receipt of goods on the tax invoice and also obtain acknowledgement of receipt of goods in the registered warehouse from the warehouse operator and the endorsed tax invoice and the acknowledgment of the warehouse operator shall be provided to the registered supplier as well as to the jurisdictional tax officer of such supplier; and

(ix) when goods have been exported, the registered recipient shall provide copy of shipping bill or bill of export containing details of Goods and Services Tax Identification Number (GSTIN) and tax invoice of the registered supplier along with proof of export general manifest or export report having been filed to the registered supplier as well as jurisdictional tax officer of such supplier.

2. The registered supplier shall not be eligible for the above mentioned exemption if the registered recipient fails to export the said goods within a period of ninety days from the date of issue of tax invoice.

Please advice whether the above procedure is coorrect or not.

[Rajagopalan Ranganathan]

Sir,

You have to follow the procedure prescribed by the Notification. If you are aggrieved then you can challenge the Notification in the court of Law through appropriate petition. Therefore there is no question whether the procedure prescribed by the Notification is correct or not.