Foreign Inward Remittance Certificate - GST is applicable or not

[RAMAKRISHNA M]

Evening All,

I need to under whether GST will attract for 'Foreign Inward Remittance Certificate' because if we get Sales commission for Imported Products in India, Banks will issue FIRC.

While raising Invoice to Foreign customers we cannot add GST in that invoice.

Please clarify.

regards,

Ramakrishna M

[KASTURI SETHI]

GST is applicable.

[Kishan Barai]

A Foreign Inward Remittance Certificate (FIRC) is a document that acts as a testimonial for all inward remittances and payments received in India from abroad. So I would like to elaborate your query because FIRC would be generated if you export goods out of India & receive currency in India, but it cant come when goods imported in India for that payment has to be made, so where is the question of "While raising Invoice to Foreign customers we cannot add GST " that invoice. For exports, there is no GST

[KASTURI SETHI]

Sh.Kishan Barai Ji,

In view of elaboration and clarification of query by you, I agree with you. Very well explained.

[Rajagopalan Ranganathan]

Sir,

You are facilitating the sale of imported goods in India on commissioner basis. Though the commission is paid by your foreign customer in convertible foreign currency the service is provided by you within the taxable territory, that is India. Therefore you have to pay the gist on the commission earned. The same cannot be passed on to your foreign customer since you are the service provider and you are liable to pay the gst and your foreign customer is in no way concerned with that.

[KASTURI SETHI]

In addition to above, it is further opined that mere receipt of foreign exchange does not qualify for export.

[RAMAKRISHNA M]

Dear All,

Thanks for your opinions.

Once again brief this Business Flow for complete clarity and request your suggestions for the same.

We are Commission Agents for Italian Machinery suppliers.

Once Machinery is Purchased by the Indian Industrialists, we will be getting sales commission from Italian Companies.

In the above Business Flow, we are raising Invoices to the Italian companies in Euro and we will be getting Euro payments through Bank.

Also we are providing services in India for those Machineries, for which also we be paid by the Italian companies.

So Please clarify, is these transactions will attract GST, if yes what the rate of %. Also please confirm whether these will be under RCM

Request you to clarify .

Thanks & regards,

Ramakrishna.M

[MUKUND THAKKAR]

In the above Business Flow, we are raising Invoices to the Italian companies in Euro and we will be getting Euro payments through Bank.

if raising invoices is not pertaining to export, which is meant for regularised your foregien income.

As per view of all expert is right and correct.

[KASTURI SETHI]

If we go by the common knowledge, the place of enjoyment is in India. No export as per GST law or pre-GST law (Central Excise and Service Tax).

[DR.MARIAPPAN GOVINDARAJAN]

I endorse the views of Shri Rajagopalan.

[jagad eswar]

Dar Ramakrishna,

Did you get required clarifications from this fourm. Are you also filing GSTR1? Is there a need for this?

Sividha centeres dont have any answers for your problem and I am also in similar business like you.

Regards

Eswar

AI Summary

Taxability of commission: commission for facilitating domestic sales is taxable in India under GST, not an export. Mere receipt of foreign exchange evidenced by a FIRC does not constitute export under GST. Commission earned by an Indian agent for facilitating sales of imported goods, even when invoiced in foreign currency and paid abroad, is a service provided and enjoyed in India and thus treated as a taxable supply under GST. The supplier remains liable for GST; questions on applicable rates and reverse charge treatment were raised but not conclusively resolved in the discussion.