CLEARANCE TO SEZ UNIT UNDER GST

[SURYAKANT MITHBAVKAR]

While clearnce to SEZ unit without GST.

Is it necessary to clear under LUT under GST.

[Himansu Sekhar]

Yes, with LUT or Bond.

As per FAQ: Question 5:

The supplies to a SEZ unit or SEZ developer are treated as zero rated supplies in the GST Law. Then why there is no specific mention in the GST Law about not charging of tax in respect of supplies from DTA unit to a SEZ unit or SEZ developer?

Answer: Yes, supplies made to an SEZ unit or a SEZ developer are zero rated. The supplies made to an SEZ unit or a SEZ developer can be made in the same manner as supplies made for export:

• either on payment of IGST under claim of refund;

• or under bond or LUT without payment of any IGST.

[KASTURI SETHI]

No doubt at all. Rightly replied by Sh.Himansu Sha an expert.

[Himansu Sekhar]

Thank you sir,

[Kishan Barai]

Great reply by Himanshu sir, there is one more option available for supply to sez i.e Bond + BG if you are not eligible for LUT.

[Himansu Sekhar]

Thank you kishanji. Also answer my question in your article on export.

[Kishan Barai]

I just forgotten your question, can you please ask it again in discussion forum ??

[subramanian vijayakumar]

Expert Sha has rightly enlightened

[Nash Industries I Pvt Ltd]

Clearance to SEZ is treated as physical export from the taxation perspective unlike the clearance to EOU.

Since the clearance to SEZ is a physical export , it can be cleared either without payment of IGST on bond or LUT or on payment of IGST under claim of Rebate.

However, the clearances to EOU will be on payment of IGST or CGST+SGST as applicable like any other domestic supplier

Regards

S.Ramaswamy

AI Summary

Zero-rated supplies to SEZ units may be made under bond or LUT without tax, or on IGST with refund. Supplies from a DTA unit to an SEZ unit or SEZ developer are zero-rated supplies and can be made either under a bond or Letter of Undertaking without payment of IGST, or on payment of IGST with a claim for refund; suppliers not eligible for LUT may furnish a bond with a bank guarantee. Clearance to an SEZ is treated as a physical export, whereas clearances to EOUs require payment of IGST or CGST and SGST as applicable.