Deemed Export - Invoicing under GST

[Ramaswamy S]

At present an EOU is allowed to invoice to another EOU in free foreign currency. No ED is charged. However, VAT is leviable if Intra State and CST (reimbursable) if Inter State.

Under the GST regime, the invoice is to be uploaded onto the GSTN. IGST is leviable on Inter State supply of goods from one EOU to another and CGST+SGST if the supply is Intra State (from one EOU to another EOU).

Query: Whether an EOU is allowed to invoice to another EOU (Intra State supplies) charging CGST+SGST in free foreign currency.

Neither SEZ authorities nor the CE/ Customs have any clarity on the matter. Even RBI says it is a transactional matter and the authorised dealer (banker) needs to reply.

May I have the views of the other experts on the matter as these will create havoc on the first day of GST regime for many EOU (irrespective of the industry).

Thank you

With Regards

S.Ramaswamy

AI Summary

Invoicing Between EOUs Under GST: Can EOUs Invoice Intra-State Supplies in Foreign Currency With CGST and SGST? A participant raised a query about invoicing between Export Oriented Units (EOUs) under the GST regime, questioning whether EOUs can invoice other EOUs for intra-state supplies in foreign currency while charging CGST and SGST. The lack of clarity from SEZ authorities, customs, and RBI was noted, with the latter deferring to authorized banks for guidance. The response highlighted that GST-related draft rules have been issued, but specific rules for EOUs or under the Foreign Trade Policy have not yet been released, suggesting that awaiting further notifications is necessary. This uncertainty supports the proposed GST rollout date of September 1, 2017.