AMORTISATION REQUIREMENT UNDER GST

[CABIJENDERKUMAR BANSAL]

X(USA) has signed contract with Y(India) for production of goods & export to X.Mould was to be provided by X as per contract. X has given advance of ₹ 50 L to Y for purchase of mould in India & to be retained by Y for production. Y purchased mould from Z(India) & availed GST input on this. Should Y raise export invoice of mould to X(though physically to be retained by Y)? or Y shall add amortised cost of mould in export invoices of goods to X? is input eligible on purchase of mould by Y from z.

AI Summary

GST Query: Should Y Invoice Mould to X or Amortize Cost in Exports? Circular Guidance Debated. A discussion on the Goods and Services Tax (GST) addressed a query about the treatment of a mould purchased by Y (India) from Z (India) for production under a contract with X (USA). X provided an advance for the mould, which Y retained for production. The question was whether Y should invoice the mould to X or include its amortised cost in the goods exported to X. Responses highlighted the importance of the invoice's name and referenced a circular for guidance. The circular's clarity was debated, with specific points on tool movement and credit reversal discussed.