Proof of Export under GST, Goods and Services Tax - GST

[Pradeep Kaushik]

Dear Experts,

We are a Merchant exporter. We procure material from Indian Domestic market by paying GST @ 0.01%

Our Supplier is asking for Proof of Export. Earlier, before GST implementation, there was a process to submit ARE-1.

Pls. share the process about the proof of export documentation for exports business under GST.　

Thanks and best regards.

Pradeep Kaushik

Posts / Replies

[Alkesh Jani]

Sir/Madam,

First of all there is no concept of merchant exporter in GST. As an exporter you have procured material at 0.01% in terms of Notification No. 40/2017-CT (Rate) dated 23/10/2017. As this rates are concessional and Notification is a conditional Notification, therefore, you are required to fulfill the conditions mentioned therein. The relevant paras are reproduced below:-

"(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;

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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”.

From above, it is clear that there is nothing called proof of export to be submitted, but to provide Shipping bill or Bill of Export and EGM to your supplier and also to the jurisdictional Tax officer of your supplier.

Our experts may please correct me if mistaken

[KASTURI SETHI]

I concur with the views of Sh.Alkesh Jani Ji regarding the submission of docs as proof of export. The phrase, "Merchant Exporter" exists in various notifications, circulars etc. So how we can say that the concept of 'merchant exporter' does not exist in GST regime ? No doubt it is covered under the definition of 'Person', 'registered person' and 'exporter'. Sh.Alkesh Ji, Will you please throw more light ? Thanks.

[CS SANJAY MALHOTRA]

Sh Kasturi ji,

Am in agreement with you. Merchant exporters are eligible for supplies at 0.1% concessional rate and not ofhers. Whenever we have taken up with GST council, concept of Merchant Exporter has been discussed as same means exporting the goods AS IS without undertaking any process. had this concept not been there, confusion would have prevail.

[KASTURI SETHI]

Sh.C.S.Sanjay Malhotra Ji,

Thanks a lot for clarification, Sir..

[Alkesh Jani]

Sir, With due regards to both the experts, I invite special attention to Q.4 and its answer at Sectrol Series FAQ, for Exports, the same is reproduced below for your ready reference

“Question 4: For merchant exporters, is there any change in the Export Procedure under the GST regime?

Answer: The concept of merchant or manufacturer exporter would become irrelevant under the GST regime. The procedure in respect of the supplies made for export is same for both merchant exporter and a manufacturer exporter.”

Further, as we all know that erstwhile law i.e. Excise and Customs and Finance Act, was manufacture and service provider based, however, in GST it is supply base. However, as you both are highly intellectual and experts I have nothing more to add.

Any misperception may please be brought to notice to enrich my knowledge. Thanks

[YAGAY ANDSUN]

This concept of Merchant Export do exist but in FTP.  We endorse the very view of Mr. Jani.

[CS SANJAY MALHOTRA]

Dear Mr Alkesh,

FAQ to be read as per the law prevailing at that time. Concept has been changed afterwards as concessional rate has been brought in for Merchant Exoorts and not for others. Do try to take council representations and press release of FM and GST council, which will give you clarity as to what made GST council to bring in differential rate for Merchant exporters subjects conditions.

Refer to press release of FM for the month of Oct, hopefully you will find the answer.

[KASTURI SETHI]

Sh.C.S. Sanjay Malhotra Ji, .I have been perusing you replies in this forum for the last 3-4 yrars, your replies always enrich my knowledge. One can find innovative ideas in your replies which motivate others. Thanks a lot.