TMI BlogTAXABILITY OF EXPORT TO NEPALX X X X Extracts X X X X X X X X Extracts X X X X ..... Sale to Nepal and Bhutan is taxable or it will be considered as zero rated supply if payment has been realized in Indian currency . - Reply By Rajagopalan Ranganathan - The Reply = Sir, Export to Nepal is zero rated but export to Bhutan is liable to IGST. - Reply By ROHIT GOEL - The Reply = Sir but payment has been realized in INR and not in foreign currency - Reply By Alkesh Jani - The Repl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y = Sir, My point of view is that export of goods to Nepal or Bhutan fulfills the condition of GST law for taking goods out of India, hence, it will be treated as zero rated supplies. With regards to realization in Indian currency is concern, the Circular No. 8/8/2017-GST dated 04/10/2017 may be taken into consideration. The relevant portion is reproduced below:- 2 (k) Realization of export ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceeds in Indian Rupee: Attention is invited to para A (v) PartI of RBI Master Circular No. 14/2015-16 dated 01stJuly, 2015 (updated as on 05th November, 2015), which states that there is no restriction on invoicing of export contracts in Indian Rupees in terms of the Rules, Regulations, Notifications and Directions framed under the Foreign Exchange Management Act, 1999 . Further, in terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Para 2.52 of the Foreign Trade Policy (2015-2020), all export contracts and invoices shall be denominated either in freely convertible currency or Indian rupees but export proceeds shall be realized in freely convertible currency. However, export proceeds against specific exports may also be realized in rupees, provided it is through a freely convertible Vostro account of a non-resident bank si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tuated in any country other than a member country of Asian Clearing Union (ACU) or Nepal or Bhutan . Accordingly, it is clarified that the acceptance of LUT for supplies of goods to Nepal or Bhutan or SEZ developer or SEZ unit will be permissible irrespective of whether the payments are made in Indian currency or convertible foreign exchange as long as they are in accordance with the applicable RB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I guidelines. It may also be noted that the supply of services to SEZ developer or SEZ unit under LUT will also be permissible on the same lines. The supply of services, however, to Nepal or Bhutan will be deemed to be export of services only if the payment for such services is received by the supplier in convertible foreign exchange In view of above payment of services exported to Nepal or Bh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utan shall be in convertible foreign exchange and not for GOODS. - Reply By Rajagopalan Ranganathan - The Reply = Sir, As per the reply given to question 8 of FAQ on Exports issued by CBEC Export of goods to Nepal or Bhutan fulfils the condition of GST Law regarding taking goods out of India. Hence, export of goods to Nepal and Bhutan will be treated as zero orated and consequently will als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o qualify for all the benefits available to zero rated supplies under the GST regime. However, the definition of export of services in the GST Law requires that the payment for such services should have been received by the supplier of services in convertible foreign exchange. But with effect from 27.10.2017 this condition of receipt of export proceeds in foreign exchange had been removed vide S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l. No. 10 D of Notification No. 9/2017- Integrated Tax (Rate) dated 28.6.2017 as amended by Notification No. 42/2017-Integrated Tax (Rate) dated 27.10.2017 . - Reply By Alkesh Jani - The Reply = Sir, Thanks for your valuable views, In the instant case it may be treated as Export of service with Nil rated. - Reply By Kishan Barai - The Reply = Make sure in your Bills of Exports there woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d be one condition that weather supply ment against LUT/Bond in it one needs to tick Y or N, one of my clients forwarder has made tick in Y by mistake, bellow all IGST paid amount was mentioned, which was applied for refund, we ask for refund because of Y error instead of N they denied, to change Bill of Exports we took pain staking efforts to get a letter from commissioner did amendment in Bi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lls of Exports was allow refunded, so make sure you take care about such matters in advance, rest suggessions are correctly coined by other experts. - TAXABILITY OF EXPORT TO NEPAL - Query Started By: - ROHIT GOEL Dated:- 12-2-2018 Goods and Services Tax - GST - Got 6 Replies - GST - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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