SALE FROM BONDED WAREHOUSE TO OUT OF INDIA

[NILESH PITALE]

DEAR EXPORTS

ONE OF THE MY CLIENT HAVE BEEN IMPORTED THE GOODS AND STORED THE GOODS AT BONDED WARE HOUSE AT NAVA SHIVA PORT AND THE SAME GOODS HAVE SOLD OUT AT TURKY ( OUT OF INDIA). NO DUTY PAID ON IMPORT.

QUAIRY : WHEATHER IT IS NON GST SALE OR CONSIDER AS EXPORT SALE LABILE TO IGST IF LUT HAS NOT TAKEN

PLEASE GUIDE

THANKING YOU

[Rajagopalan Ranganathan]

Sir,

Since the imported goods were diverted another foreign country before the goods crossed the customs barrier it is akin to high sea sales and no duty is payable. Import of goods will be completed only when it is cleared by Customs on payment of applicable duty from the bonded warehouse.

[Adarsh Sharma]

As per Section 69 (1) of Customs Act, 1962 (Clearance of warehoused goods for export) any warehoused goods may be exported to a place outside India without payment of import duty if -

a shipping bill or a bill of export or the form as prescribed under section 84 has been presented in respect of such goods;

Hence you can export the said warehoused goods under section 69 (1) by filling proper Shipping Bill.

[YAGAY andSUN]

Since goods were not crossed the customs frontier, therefore, Indian Tax Jurisdiction i.e. applicability of GST will not come in the purview. Section 69(1) of the Customs Act, 1962 as amended from time to time is an appropriate Section to deal with such matters.

AI Summary

Goods Sold from Bonded Warehouse to Turkey Are Non-GST Sales; No Import Duty Under Section 69(1) Customs Act A client imported goods stored at a bonded warehouse in India and sold them to Turkey without paying import duty. The query was whether this constitutes a non-GST sale or an export sale liable to IGST if no Letter of Undertaking (LUT) was taken. Responses clarified that since the goods were sold before crossing the customs barrier, it is similar to high sea sales, and no duty is payable. Section 69(1) of the Customs Act allows warehoused goods to be exported without import duty if the proper shipping documentation is filed. Thus, GST does not apply.