Sale of MESE certificate

[RAHUL GAIKWAD]

Sir,

I Have sold the certificate Issued by DGFT against export. The certificate is under Merchant Export Incentive scheme.

I want to sell the said certificate, please let me know whether said is taxable under GST ?? if Applicable , under Goods of Srvice, and rate of Tax ??

[SURYAKANT MITHBAVKAR]

Selling of MEIS License is exempted under Notification No.35/2017 CE (Rate) Dated 13.10.2017.

[RAHUL GAIKWAD]

Thanks

[Spudarjunan S]

Dear Rahul Ghaikwad,

The sale of MEIS certificate would be treated as exempted supply w.e.f 13th October 2017 by virtue of sl.no.122A of notification no.02/2017 C.T(R) dated 28th June 2017, as amended by notification no.35/2017 C.T(R) dated 13th October 2017.

However, with the benefit of exemption you should be vigilant that Rule 42 would be applicable if you provide both taxable and exempted supplies and you need to reverse the common credits in proportion to taxable and exemted supplies. Kindly refer rule 42 of CGST rules 2017.

[KASTURI SETHI]

Dear Sh. Spudarjunan S Ji,

Thanks for such accurate reply. Really your reply has enriched my knowledge.

AI Summary

Exemption for sale of MEIS certificates confirmed; exempt supply status affects input tax credit apportionment under GST rules. Sale of MEIS certificates is an exempted supply under the GST exemption notifications effective mid-October 2017, so GST is not leviable on such transfers. If a taxable person makes both taxable and exempt supplies including sale of MEIS certificates, the apportionment and reversal mechanism for common input tax credit under the relevant GST input tax credit rule (Rule 42) applies, requiring proportionate reversal or adjustment of credits attributable to exempt supplies.