9911796707
TMI BlogClarification relating to export of services - Settlement of export consideration in Indian Rupee (INR) through VOSTRO account – sub-clause (iv) of the Section 2 (6) of the IGST Act 2017X X X X Extracts X X X X X X X X Extracts X X X X ..... ating to export of services sub-clause (iv) of the Section 2 (6) of the IGST Act 2017 reg. Various representations have been received requesting for clarification regarding admissibility of export remittances received in Special INR Vostro account, as permitted by RBI, for the purpose of consideration of supply of services to qualify as export of services as per the provisions of clause (6) of section 2 of the Integrated Goods Services Tax Act, 2017 (herein after referred to as the IGST Act ). 2. The issue has been examined and to ensure uniformity in the implementation of the provisions of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1) of the Central Goods Services Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to promote growth of global trade with emphasis on exports from India and to support the increasing interest of global trading community in INR, it has been decided to put in place an additional arrangement for invoicing, payment, and settlement of exports / imports in INR. Before putting in place this mechanism, AD banks shall require prior approval from the Foreign Exchange Department of Reserve Bank of India, Central Office at Mumbai. Para 3 of the Circular is reproduced below: 3. In terms of Regulation 7(1) of Foreign Exchange Management (Deposit) Regulations, 2016, AD banks in India have been permitted to open Rupee Vostro Accounts . Accordingly, for settlement of trade transactions with any country, AD bank in India may open Sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugh this mechanism shall make payment in INR which shall be credited into the Special Vostro account of the correspondent bank of the partner country, against the invoices for the supply of goods or services from the overseas seller /supplier (ii ) Indian exporters, undertaking exports of goods and services through this mechanism, shall be paid the export proceeds in INR from the balances in the designated Special Vostro account of the correspondent bank of the partner country. 3.5 On perusal of the above, it can be stated that the condition(s) of sub-clause (iv) of Section 2(6) of the IGST Act, 2017 , can be considered to be fulfilled when the Indian exporters, undertaking exports of services, are paid the export proceeds in ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
