LUT certificate is mandatory for licences

[raj seeds]

hi,

we are planing to buy some online licenses from vendor when we ask vendor for LUT certificate availability he says below ..

GST department we come to know that LUT is not mandatory in our transaction because we supply software having SAC code 997331 and LUT is applicable where physical goods supply in SEZ zone.

can some body help me on this.

[KASTURI SETHI]

LUT is mandatory for both types of exports. Both are at par regarding execution of LUT. The purpose of LUT or Bond is to safeguard revenue. How can revenue be safeguarded without LUT or Bond ? Only one option is left that is pay tax and claim refund. Go through C.B.I. & C. Circular No. 88/07/2019-GST, dated 1-2-2019thoroughly.

[raj seeds]

Dear sir,

so even for non physical goods supplier should have LUT

[KASTURI SETHI]

Pl. refer to your query at serial no. 2 above, answer is yes.

AI Summary

LUT requirement for exports applies to goods and services including software; absent LUT tax must be paid then refunded.
LUT is mandatory for exports of both goods and services, including online software, with LUT or Bond required to safeguard revenue; absent LUT the supplier must pay tax and claim refund under the applicable GST procedural guidance.