Supply from once FTWZ to another FTWZ

[Kaustubh Karandikar]

XYZ (Logistic Company) registered with FTWZ imported goods on behalf of PQR (registered with GST) without payment of import duty. PQR supplied these goods from this FTWZ to ABC but ABC informed PQR to supply the same to EFG (another logistic company) registered with FTWZ without payment of GST. PQR shown this transaction in the GST Return under supply to SEZ. Is the entire transaction correct?

[Nitesh Jain]

Sir, In our views, Transaction by PQR to EFG on instruction of ABC is Bill to ship to transaction. Accordingly , while supplying to ABC GST needs to be charged and ABC in its return will show supply to PQR as zero rated supply.

AI Summary

Bill-to-ship-to treatment requires the supplier to charge GST while intermediary reports a zero-rated supply outcome. The operative legal characterization is bill-to-ship-to: the initial supplier must treat the sale to the billed party as a taxable supply with GST charged, while the intermediary records the onward movement as a zero-rated supply consequence in its return; reporting and chargeability follow contractual billing and shipping directions rather than mere physical movement between FTWZ entities.