High sea sales

[THYAGARAJAN KALYANASUNDARAM]

Dear expert,

Can you explain elaborately the position of high sea sales under the GST regime. Thanks iin advance.

[Ganeshan Kalyani]

In my view it is export of goods. Export can happen with payment of GST or without payment of GST.

[THYAGARAJAN KALYANASUNDARAM]

Dear expert,

As per sec 5(2) of CST act, when the importer import the goods instead of taking delivery from customs, they will transfer the title and the original buyer will file the bill of entry with the respective authority after paying the duty and fees. And subsequently the importer will issue the invoice to the buyer without charging any vat / CST to the buyer.

Whereas under GST act, what is the position of high sea sales.

Thanks in advance.

[vk agarwal]

It has been clarified in FAQs issued by CBEC that high seas sale will attract IGST only once that is at the time of filing of bill of entry on the value declared in the bill of entry. The value in the bill of entry would be value at which the goods have been purchased on high seas

[THYAGARAJAN KALYANASUNDARAM]

Dear sir,

I am also gone through the tweet Faq sI.no.97, it is not clear. Could you please elaborate on this. Thanks in advance.

[Kishan Barai]

Prior to GST, people opt for High Sea Sales to save VAT, now post GST, people can save dual IGST payment. Import of Goods will attract Basic + IGST and after importing it one sale to someone else and also charge GST in bill but when goods are sold on high sea, then no CGST/SGST or IGST could be charged on bill at the time of selling because goods are sold in sea i.e. international borders, not India but applicable import duty has to be paid.

AI Summary

High sea sale treatment: IGST charged at import via bill of entry; subsequent resale not subject to domestic GST. High sea sales are treated as imports and IGST is payable once at the time the bill of entry is filed, based on the value declared reflecting the high sea purchase; importation is subject to applicable customs duties plus IGST, and subsequent domestic resale by the importer does not attract CGST/SGST or a second IGST charge.