Export Proceeds realised in INR, Goods and Services Tax - GST

[Nikhil Agrawal]

Dear Sir/Ma'am,

Hope all are doing well !

Case:- Client has provided service to a foreign company & raised the invoice in foreign currency. The export proceeds for the same were received in INR through the establishment of a foreign company in India, also the bank has not issued FIRC for the same.

Que. 1- Will it be treated as Export?

Posts / Replies

[ABHISHEK TRIPATHI]

Dear Nikhil Ji,

2 (6) "export of services means the supply of any service when,––

(i) the supplier of service is located in India;

(ii) the recipient of service is located outside India;

(iii) the place of supply of service is outside India;

(iv) the payment for such service has been received by the supplier of service in convertible foreign exchange or in Indian rupees wherever permitted by the Reserve Bank of India;

Hence you may receive the payment in INR.

Further kindly refer Circular No. 88/07/2019-GST and the allied circulars.

[ABHISHEK TRIPATHI]

*Addition:

You must be worried regarding the situation "where the payment is received by the foreign establishment in India". Whether such payment will fall under the definition of export of services? The answer to this question lies in RBI Circular. RBI Circular has stated situation when such payment is recognized as receipt of export.

Check your details and see whether your case falls under the RBI Circular. The entire logic for this comes from the definition itself, relevant part, 'in Indian rupees wherever permitted by the Reserve Bank of India'. Thus you need to see whether RBI has permitted such payment in INR.

[KASTURI SETHI]

I support the views of Sh.Abhshek Tripathi, Sir.

[DR.MARIAPPAN GOVINDARAJAN]

Whether the query is in regard to GST?