High Seas Sales

[Sanjay Agarwal]

I am importing an item and want to sell the same on High seas sales basis , to a customer based in India which is 100% Export oriented unit. Can I raise my High seas sales Invoice to the customer in USD, and collect the proceeds from him in USD ?

[PAWAN KUMAR]

Yes, invoice can be raised in USD as this High Seas Sales is outside the territorial jurisdiction of India but you will have to provide the same in hss agreement with your buyer.

in case of HSS, only the goods are outside the Indian territory on international sea but the HSS agreement has to be executed on stamp paper in India. It is a transaction between the two indian residents hence no foreign currency transaction is allowed between the two Indian redients within India. The agreement shall be deemed to be in rupee only but for payment/amount purpose you may give reference to a dollar like " for a consideration of rupees equal to ____ US$ to be converted as per the SBI card rate on a particular date or at a fixed conversion rate etc.

The custom duty shall be levied based upon the high sale value in ruppes if it is more than 2% + the import value.  If reference to US$ has been given in HSS then the Custom department shall convert the US$ by applying the rates on BE date with reference to the rate declared by customs from time to time.

Thanks

 

S.R. Bansal

      

[Sanjay Agarwal]

Thanks Mr Bansal.

Regards

 

Sanjay Agarwal

 

AI Summary

High seas sales: invoicing may reference foreign currency but domestic agreements and payments are treated in rupees for compliance.
High seas sales require a domestic HSS agreement executed in India and are treated as transactions between Indian residents; payments cannot be made in foreign currency domestically though the agreement may reference a foreign currency amount with a rupee equivalent or conversion mechanism. Customs assesses duty on the HSS value in rupees, converting any referenced foreign currency at the rate applicable on the bill of entry date or as declared by customs.