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Exports procedures and rules under GST Definition of Exports:
Government always promotes export the Goods or Services so that foreign exchange can be earned. one should know meaning of Export under GST. Export can be of goods or services or both as defined under IGST Act.
Meaning of Export of Goods:
According to Section 2(5) of IGST Act, 2017 provides that ‘export of goods’ means taking goods out of India to a place outside India.
Meaning of Export of Services:
According Section 2(6) of IGST Act, 2017 provides that ‘export of services’ means the supply of any service when:
– supplier of service is located in India;
– recipient of service is located outside India;
– place of supply of service is outside India;
– payment for such service has been received by the supplier of service in convertible foreign exchange;
– supplier of service and the recipient of service are not merely establishments of a distinct persons Details:
If all the conditions are satisfied for services then it will be treated as export of Services.
Place of Supply for Export: The place of supply of goods exported from India shall be the Location outside India.
Supply made to SEZ unit/developer can be treated as “zero rated supply”
Exporter or a person making Zero rated supply can be refund either of the two option:
1) Supply of goods or services or both under bond or Letter of Undertaking (LUT), subject to such conditions. Safeguards and procedure as may be prescribed, without payment of integrated tax and claim refund of unutilized input tax credit;
2) Supply goods or services or both, subject to such conditions. Safeguards and procedure as may be prescribed, on payment of integrated tax and claim refund of such tax paid on goods or services or both supplied, in accordance with the provisions of section 54 (Refunds) of the Central Goods and Services Tax Act or the rules made there under.
GST – EXPORT PROCEDURE UNDER BOND OR LETTER OF UNDERTAKING
(1) Any registered person availing the option to supply goods or services for export without payment of integrated tax shall furnish, prior to export, a bond or a Letter of Undertaking in FORM GST RFD-11 to the jurisdictional Commissioner, binding himself to pay the tax due along with the interest specified under section 50(1) within a period of —
(a) fifteen days after the expiry of three months from the date of issue of the invoice for export, if the goods are not exported out of India; or
(b) fifteen days after the expiry of one year, or such further period as may be allowed by the Commissioner, from the date of issue of the invoice for export. If the payment of such services is not received by the exporter in convertible foreign exchange.
(2) The details of the export invoices contained in FORM GSTR-1 furnished on the common portal shall be electronically transmitted to the system designated by Customs and a confirmation that the goods covered by the said invoices have been exported out of India shall be electronically transmitted to the common portal from the said system.
(3) Where the goods are not exported within the time specified in sub-rule (1) and the registered person fails to pay the amount mentioned in the said sub-rule, the export as allowed under bond or Letter of Undertaking shall be withdrawn forthwith and the said amount shall be recovered from the registered person in accordance with the provisions of section 79.
(4) The export as allowed under bond or Letter of Undertaking withdrawn in terms of sub rule (3) shall be restored immediately when the registered person pays the amount due.
(5) The Board, by way of notification. May specify the conditions and safeguards under which a Letter of Undertaking may be furnished in place of a bond.
(6) The provisions of sub rule (1) shall apply, mutatis mutandis. In respect of zero-rated supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit without payment of integrated tax.”
Export procedure on payment of IGST & claim refund of ITC will be covered in next article.
CA- Monika N Rathi