ITC on export of ENA

[KARAN VERMA]

Sir

My query is if i am exporting ENA (Spirit) out of india, then whether i am eligible to claim input tax credit on inputs/input services exclusively used in exporting ENA.

Currently, i am paying VAT on domestic sale of ENA.

[Rajagopalan Ranganathan]

Sir,

Since you are paying VAT the product exported by you is not covered by GST Act. Hence you cannot claim refund of input tax credit exclusively used in exporting ENA.

[KARAN VERMA]

Sir, in domestic sale of ENA, if i am selling ENA to pharmeuticals, chemical industry, then i am levying 18% GST, if i am selling ENA to liquor companies, then VAT is charged on sale.

In case of foreign customer who is agent, i do not know for which purpose he has used such ENA.

[Rajagopalan Ranganathan]

Sir,

Initially you have not given full details. If ENA supplied in the taxable territory and cleared for export are of the same quality then claim the refund of input tax credit. However the input tax credit availed on input goods, services etc on ENA supplied to liquor manufacturer is to be reversed since liquor is not under GST Act.

[KASTURI SETHI]

You are not concerned for what purpose foreign customer uses ENA. I support the views of Sh.Ranganathan,Sir.

AI Summary

Input tax credit eligibility depends on ENA's GST classification; credits must be reversed for supplies falling under VAT. Claiming input tax credit for inputs used in exporting ENA hinges on ENA's tax classification: if domestic sales of ENA to taxable buyers are under GST and exported ENA is of the same quality, ITC/refund may be claimed; inputs attributable to supplies to liquor manufacturers (outside GST and subject to VAT) must have ITC reversed. The exporter's ignorance of the foreign buyer's use does not affect this entitlement.