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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 ..... 49/82/2017-GST, Notification No. 16/2017-GST dated 7 th July, 2017, Circular No. 2/2/2017 - GST dated 5 th July, 2017 and Circular No. 4/4/2017 - GST dated 7 th July, 2017. Kind attention is invited to Board's Circular No. 5/5/2017-GST dated 11 th August, 2017 on the above subject. 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 clarified hereunder; a. Eligibilit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 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 ₹ 1 crore. IV. An exporter has export turnover of ₹ 40 crore. He has received ₹ 2 crore 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 this scenario, he will be eligible for LU ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 (updated as on November 5, 2015), which states th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 different registered persons (distinct persons in te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns 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 given by the said circulars are effective ..... X X X X Extracts X X X X X X X X Extracts X X X X
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