Sales Return From SEZ Area to DTA

[Ramesh Totla]

Respected ALL Members,

Fact Of the Case: 

1. Our Company Sold good to SEZ Area without payment of Duty and file ARE-1 d with Department

2. .After 3 months SEZ area has rejected our material and want to return us.

3. we agreed to take the rejected material from SEZ.

4. We will not give any replacement for that rejected material to SEZ Area.

Issue:  i) What will be the procedure for removal of goods from SEZ Area to our Factory (DTA) ?

            ii) Whether there will be any Tax Liability and who is liable to pay Tax?

           iii) If It will be Paid By SEZ then whether we are eligilble for any 'INPUT Credit'

           iv) There is any way for removing the goods from SEZ Area without payment of duty Being this is not 'sale' for SEZ this is only Purchase Return

Kindly Advise in the matter at the earliest.

[Guru Murthy]

 The procedure for removal of goods from SEZ area to your factory(DTA) is as follows:

1.SEZ should raise an invoice(DTA) with appropriate duties & taxes to you. You may avail the credit of duties paid by SEZ. SEZ may recover the duties paid to you from the payment due to you.

2. Yes there will be tax liability and you you have to pay the tax

3. duties paid eligible for input credit

This is only way for removing the goods from SEZ area.

 

AI Summary

Tax liability on goods returning from SEZ: SEZ must invoice and duties paid, with recipient eligible for input credit. Removal of goods returned from an SEZ to the DTA requires the SEZ to issue a DTA invoice, discharge applicable duties and taxes, and recover those amounts from sums payable to the supplier; duties paid on such removal are eligible for input credit by the recipient in the DTA, and no method without duty payment is identified.