Bill to overseas, Ship to India from India

[Shrinivasaraghavan P V]

The situation is as follow

We produce machine in India and is under Contract Manufacturing Agreement with our Principal. We will now have to deliver a machine in India and bill to principal who is overseas. We will get the money from our principal.

Should we include the GST as the delivery is to India when we bill? though the buyer is our Principal.

What is the code under which the foreign currency can be cleared from the bank and what documents need to be produced to the bank?

It would be of great help if experts answer this query. Also, let me know the clause under which this situation is described.

Thanks.

[YAGAY and SUN]

Under FTP 2015-2020, Such transaction may be treated at par with Deemed Exports but under GST Law only four categories are recognised as Deemed Export and the above transaction does not fall under the category of Deemed Export. Hence liable to GST.

AI Summary

Deemed export treatment not available under GST for domestic delivery billed abroad, resulting in GST liability on supply.
A machine manufactured in India and delivered in India but billed to an overseas principal does not qualify as a deemed export under GST because the GST law recognises only four specified categories of deemed export; consequently such a supply is taxable under GST despite FTP treating similar transactions as deemed exports for trade policy purposes.