CAN REFUND CLAIM ON SUPPLY MEDE TO SEZ UNIT WITH PAYMENT OF IGST

[PIYUSHBHAI POPAT]

HELLO EVERY ON

CAN I CLAIM REFUND ON SUPPLY MADE TO SEZ UNIT WITHPAYMENT OF IGST ,AFTER AMENDMENT IN SEC 54(8) A OR I SHOULD MADE SUPPLY TO SEZ UNIT WITHOUT PAYMENT OF TAX AND CLAIM REFUND OF UNUTILISE ITC

[Shilpi Jain]

I do not see any issue in making supplies to SEZ with payment of tax. The only difference with the amendment to sec 54(8) is that you would be required to demonstrate that you have not collected any tax from the SEZ which can be done by way of a declaration and if > ₹ 2L (if I remember right) refund then a CA certificate

[PIYUSHBHAI POPAT]

THANKS MAM FOR REPLAY

BUT MY POINT IS AFTER AMENDMENT IN SEC 54(8) A THEY CHANGE WORD ZERO RATED SUPPLY TO EXPORT ONLY CAN IT MEANS REFUND COULD NOT CLAIM ON SUPPLY MADE TO SEZ WITH PAYMENT OF IGST.

[KASTURI SETHI]

Till 1.2.2019 declaration was required. This declaration was redundant as actually no GST is required to be charged for supplies made to SEZ Unit or SEZ.

[Shilpi Jain]

54(8)(e) will apply in such case as per which if it is proved that burden of tax is not passed on, even in case of SEZ supplies the refund would be eligble.

For supplies to SEZ also there are 2 options available 1. unde LUT without payment of tax and 2, with payment of tax. In some cases in fact the suppliers are charging GST to the SEZ when supplies are made.

[PIYUSHBHAI POPAT]

THANKS FOR REPLAY, BUT STILL I CAN NOT UNDERSTAND WHAT IS NEED TO AMEND SEC 54(8) A,

[Rajagopalan Ranganathan]

Sir,

SEZ is treated as a foreign territory and any supply made to SEZ unit or Developer is treated as export. There are two kinds of exports. Exports made with payment of tax and without payment of tax. By the amendment both the exports namely, exports with payment of tax and without payment of tax are made eligible for claiming the refund. prior to the amendment only zero-rated supply(that is, supplies made without payment of tax) alone was eligible for a refund.

[Alkesh Jani]

Shri

Supply to SEZ Unit is "Zero Rated supply" in terms of Section 16 of IGST Act,2017. If we refer Section 20 of IGST Act at (xxv) it is mentioned "...shall, mutatis mutandis, apply...".

In my view, it will not vivisect, the refund claim of supply made to SEZ with payment of Tax.

AI Summary

Refund for supplies to SEZ: exports with or without IGST payment can qualify for refund subject to proof tax burden not passed on. Supplies to SEZ are treated as exports and may be effected either without payment of tax under LUT as zero-rated supplies or with payment of IGST. The amendment makes refunds available for both types of exports; where tax is paid, the supplier must prove the tax burden was not passed on, using a declaration and, if above the threshold, a CA certificate.