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TMI BlogWhat rate of Vat applicable Goods supplied within India but Sales Proceeds received from aborad - Foriegn Currency?X X X X Extracts X X X X X X X X Extracts X X X X ..... Dear Sir We are CNC machine Dealer our office is situated in Chennai (Tamil Nadu) We have received a purchase order from our customer at Taiwan to supply of UCAM table for CNC machine, the order value is in USD dollars, later they advised us to supply the Goods to their customer in Tamil Nadu. We already received advance from our Taiwan Customer in foreign Currency (US Dollars as per th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Purchase Order) Now we have to supply the Goods as per our customer advise to their customer in Tamil Nadu, 1. In whom favour (Name) should we raise the sales Invoice? 2. In which currency should we raise the sales Invoice - whether in INR or USD? 3. Whether Local Sales Tax (VAT 5%) is applicable or Not? if not under which gound we can avail tax exemption? Kindly Advise Imtly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Thanks Regards T. Ravi Chandiran - Reply By Pradeep Khatri - The Reply = Dear Ravi, This transaction is coming under the purview of Deemed Export. In the deemed export, goods don't leave the country but for the same goods payment will be received in foreign currency. 1) Invoice will be issued 'bill to' , 'ship to' basis. 2) you will deliver the goods on a delivery note to the India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n party and commercial invoice will be sent to foreign party and the invoice will be raised in foreign currency. 3) VAT @ 5% will not be chargeable since this transaction is coming under the purview of deemed export though tax authorities may raise objections. Further, you need to get it crossed checked from your counsel. Please also check the definition of Deemed Export in the foreign trade ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... policy. Best Regards, Pradeep Khatri - Reply By Balasubramanian Natarajan - The Reply = Dear 1.The conccept of deemed exports is applicable under the Central ecise and not under TNVAT. 2.The sale will be trated as Local sale as it does not occasion the movement of goods to a foreign drdtination 3.It is also not covered under Section 5 of the CST Act . 4.It is immetrial who has p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laced the order and in which currency the payment is received. 5.The place of delivery is critical and in this case it is with in the State and hence will be a local sale 6.The billing can be in Indian currency for easy filing of Vat returns , though th epayment is in foreign currency. 7.The coomercial invoice can be raised on the Foreign buyer with consignee as Party in Tamilnadu. Trudt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this answers your query balasubramanian n Trichy -23.02.2012 - What rate of Vat applicable Goods supplied within India but Sales Proceeds received from aborad - Foriegn Currency? - Query Started By: - Ravi chandran Dated:- 14-2-2012 Value Added Tax - VAT-CST - Got 2 Replies - VAT and Sales Tax - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India - taxmanagementindia - 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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