9911796707
TMI BlogClarification on issues related to furnishing of Bond/Letter of Undertaking for exportsX X X X Extracts X X X X X X X X Extracts X X X X ..... x assessees, Exporter, Trade and Industry and all concerned are invited to Ministry's Circular No. 5/5/2017-GST issued under 349/82/2017-GST dated 11 th August, 2017, refers Notification No, 16/2017 - GST dated 7 th July, 2017 and Circular No. 2/2/2017 - GST dated 5 th July, 2017 and Circular No, 4/4/2017 - GST dated 7 th July, 2017, A large number of communications have been received from the field formations and exporters citing variation in the interpretation of above referred notification and circulars. 2. Therefore, in exercise of powers conferred under section 168 (1) of the Central Goods and Services Tax Act, 2017, for the purpose of uniformity in the implementation of the Act, following issues are being clarifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iii. An exporter has an export turnover of ₹ 2 crore. He has received ₹ 80 lacs as foreign inward remittances in FY 2016-17 which is 40% of the export turnover. He will not be eligible for LUT facility as remittance received is less than IRS, 1 crore. iv. An exporter has export turnover of ₹ 40crore. He has received IRS, 2 Crores as foreign inward remittances in FY 2016-17 which is 5% of the export turnover. He will not be eligible for LUT facility as remittance received is less than 10% of export turnover, even though it is in excess of ₹ 1 crore. v. An exporter has received ₹ 1 Crore 10 lacs as foreign inward remittances in FY 2016-17 which is 20% of the export turnover. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to supply by the actual exporter under LUT/bond or payment of IGST. e. Transactions with EOUs: Zero rating is not applicable to supplies to EOUs and there is no special dispensation for them, Therefore, supplies to EOUs are taxable under GST just like any other taxable supplies. The EOUs, to the extent of exports, are eligible for zero rating like any other exporter. f. Forward inward remittance in Indian Rupee: Various representations have been received with respect to receipts of proceeds of supplies in Indian Rupee especially with respect to exports to Nepal, Bhutan and SEZ developer/SEZ unit. Attention is invited to Para A (v) Part-I of RBI Master Circular no. 14/2015-16 dated July 1, 2015 (upda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nk guarantee should normally not exceed 15% of the bond amount. However, the Commissioner may waive off the requirement to furnish bank guarantee taking into account the facts and circumstances of each case. It is expected that this provision would be implemented liberally. Some of the instances of liberal interpretation are as follows: i. an exporter registered with recognized Export Promotion Council can be allowed to submit bond without bank guarantee on submission of a self-attested copy of the proof of registration with a recognized Export Promotion Council ii. In the GST regime, registration is State-wise which means that the expression 'registered person' used in the said notification may mean diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted as proof of fulfilling the conditions of LUT shall be accepted unless there is any evidence to the contrary. Self-declaration shall be accepted unless there is specific information otherwise. For example, a self-declaration by the exporter to the effect that he has not been prosecuted should suffice for the purposes of notification No. 16/2017 - Central tax dated 7th July, 2017. Verification, if any, may be done on post facto basis. Similarly, Status holder exporters have been given the facility of LUT under the said notification and a self attested copy of the proof of Status should be sufficient, j, Applicability of circulars on Bond/LUTs: It is learnt that some field officers have inferred that the instructions ..... X X X X Extracts X X X X X X X X Extracts X X X X
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