import and bond to bond transfer at zero invoice value, Goods and Services Tax - GST

[A R]

We are a company based in India. We procure and supply some specialized products from China and supply the same to customers based in countries like Singapore, Hongkong, Europe and to many parts of the world.

In once of the case case, one of the Europe based company has asked us to import these product in India in our name and warehouse the same in the Customs Bonded warehouse by filing a warehousing bill of entry.

Once the goods are warehoused in the Customs Bonded warehouse, they want us to do the transfer of the same to a Duty Free Shop in India at Zero price(Zero invoice value) vide Bond to Bond Transfer.

The European Company has asked us to Invoice them in USD for :-

1. The Cost of the goods which we supply free of charge to the Duty free shop in India vide a Bond to Bond transfer

2. All other related cost involved for Import clearance, Storage cost in the Bonded warehouse, and Delivery cost of the goods such as Trucking , CHA cost for delivery of the goods to the Duty free shop vide Bond to Bond transfer etc

Now my queries are as below:-

Query 1a. – For the stock which we supply at Zero value to the Duty free shop vide Bond to Bond transfer, are we supposed to issue any Invoice to the Duty free shop and if we have to issue an invoice should we charge any GST on the same. Invoice value if to be raised will be for ZERO amount as the Duty free shop is not suppose to pay for the goods, as the European company has asked us to supply the same free of Charge (Zero Value) to the Duty free shop.

In turn the Duty free shop is also going to give these products free of charge to the International passengers when they buy the other products of a specific product at the duty free shop.

Query 1b. when these goods of zero invoice value (free of charge) are being supplied to the Duty free shop vide Bond to Bond transfer, is there a requirement of E Way Bill to be issued.

Query 2a – When we raise the Invoice to the European company for the value of the goods, are we supposed to charge any tax such as GST etc ? if yes, then kindly confirm what is the Tax rate to be charged and why ?

Query 2b – for the services which we shall be procuring from various agencies in India like CHA services, Bonded warehouse services, Transportation and which we shall be raising back to back invoice to the European company are we supposed to charge any GST or any other tax ? if yes, at what rate ?

Example : the Import price of the product is USD 5 per Piece and we are selling the same to the European company at USD 5.75 per piece plus all other services at actuals for customs clearance and other services till we deliver the goods to the Duty free shop vide bond to bond transfer.

If you need any more information to the same do write back to us.

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[YAGAY AND SUN]

Please check Section 69 of the Customs Act, 1962 read with Customs Valuation Rules.