Advise require on Input as such (Export) to Subsidiary company

[Asked by Guest]

Dear Sir,

Please advise on the following queries :

1)If we are purchasing imported Raw material and then we are exporting the same Input as such to our Subsidiary company whether we can carry out such Activity and to carry out such activity whether we can re-export such material directly to the said country.

2)Further if we are importing the said material to our Factory and from there we will export such Input as such without payment of duty under LUT, here whether we can avail the CVD and Addl CVD credit paid at the time of import and utilised the same for the domestic clearances.

Thanks and Regards.

AI Summary

Export of imported inputs: direct shipment possible, but re-export as such is likely treated as trading, limiting export benefits.
Exporting imported raw material "as such" to a subsidiary is often treated as trading, which typically disqualifies the transaction from export-linked benefits. Direct shipment from the overseas supplier to the subsidiary is operationally feasible if shipping documents (such as bill of lading with notify party, invoice and packing list) substantiate the transfer. CVD/Addl CVD paid on import may be utilised for domestic clearances only where those imported inputs are used in manufacture of exported final products; inputs removed as such for export do not attract export benefits or allow credit utilisation.