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Sale from a SEZ unit to EOU, Goods and Services Tax - GST

Issue Id: - 117840
Dated: 7-3-2022
By:- Prerna Birla
Sale from a SEZ unit to EOU

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A SEZ units imports goods from China and pays no GST due to exemption of GST on such transaction. Then such SEZ unit (a registered warehouse) sells such goods to EOU unit.

- Whether SEZ unit is liable to pay GST for such transaction ?

- Whether LUT filing is important for such case?

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Showing Replies 1 to 10 of 10 Records

1 Dated: 7-3-2022

- The SEZ is not liable to pay GST for such transaction if such goods are covered under LUT of the EOU and is required for the authorised operations of the unit. LUT under GST is required for the purpose of supply of goods without GST

2 Dated: 8-3-2022

SEZs are treated as being outside India for the purpose of duties of Customs.

As per Section 2 (m) of SEZ Act, supply from SEZ to EOU is export and hence such supply is 'import' by EOU. It is pertinent to mention that EOU is like any other supplier under GST and all the provisions of the GST laws apply. The benefit of exemption from Basic Customs duty on imports is available to EOU.

LUT is must.

3 Dated: 8-3-2022
By:- Prerna Birla

Thank you for our reply.

Also, if LUT is filed 4-5 days after the transaction date. Whether the SEZ unit be liable to pay GST and then claim refund in such case?

4 Dated: 8-3-2022

Need not pay GST and claim refund. Delay is condonable. See para no. 44 of Circular no.125/44/2019-GST dated 18.11.19 as amended.

5 Dated: 12-3-2022
By:- raghunandhaanan rvi


SEZ / FTWZ unit may transfer imported goods to an EOU subject to follow the below procedure

EOU or SEZ ( on behalf of EOU) file a home consumption bill of entry at SEZ

The bill of entry is filed with documents ( Invoice, Procurement Certificate, Bonded warehouse license, Letter of Approval, etc)

EOU is eligible to claim duty-free clearance of goods purchased from SEZ/FTWZ vide Customs Notification No. 52/2003.

A re-warehousing certificate issued by jurisdictional customs of EOU is to be submitted to SEZ customs within 45 days from the date of clearance of goods, failing which jurisdictional customs will initiate action to recover customs duty with interest from EOU.

For more details please refer to Rule 46(12) of SEZ rules 2006 amended from time to time

6 Dated: 12-3-2022

Dear Sir,

Notification No. 52/2003-Cus. (N.T.), dated 22-7-2003 stands rescinded/superseded vide 13/2007-Cus. (N.T.) dated 21-02-2007

7 Dated: 12-3-2022
By:- raghunandhaanan rvi


The Customs Notification No. 52/2003 Customs which I refer to is "Tariff" Notification and not Non-Tariff Notification.

8 Dated: 12-3-2022

Dear Sir,

You are right.

9 Dated: 17-5-2022
By:- Gaurav Gupta


As per above comment, it is stated that as per Section 2(m) of SEZ Act, supply from SEZ to EOU unit is export. This is not borne out from the law above quoted. Can you pls clarify. I may be missing out on something..

10 Dated: 17-5-2022
By:- raghunandhaanan rvi

Mr. Gaurav Gupta

There is a difference between SEZ and EOU though both were initiated to boost exports

An EOU can be set up anywhere in the country (DTA), whereas SEZ is a special facility and demarcated enclave and deemed to be outside the customs jurisdiction and therefore, a foreign territory.

Thus, Sales made from SEZ to DTA are considered imports for DTA, and applicable customs duties on such goods are payable.

Since EOU imports goods from SEZ, they entitle to claim duty exemption under Customs Notification No. 52/2003.


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