CLEARANCE TO SEZ UNIT UNDER GST

[SURYAKANT MITHBAVKAR]

While clearnce to SEZ unit without GST.

Is it necessary to clear under LUT under GST.

AI Summary

Clarification on GST: SEZ clearances are zero-rated exports, can use LUT or bond; unlike EOU subject to IGST. A discussion on the Goods and Services Tax (GST) forum addresses whether clearance to a Special Economic Zone (SEZ) unit requires a Letter of Undertaking (LUT) under GST. The consensus is that supplies to SEZ units are zero-rated and can be made either with payment of Integrated GST (IGST) under a refund claim or without IGST using a bond or LUT. An alternative for those ineligible for LUT is using a bond plus a bank guarantee (BG). The discussion clarifies that SEZ clearances are treated as exports, unlike those to Export Oriented Units (EOUs), which are subject to IGST or CGST+SGST.