Can LUT be used for the Export / SEZ sales prior to it applied

[KUMAR Narasimhan]

LUT is applied on 13th Mar 2021 for FY 2020 - 2021. Would the company is eligible to use this LUT for the Export and SEZ Sales prior to the apply of LUT fot the FY 20-21 (Means would it be eligible for the period April 2020 to 12th Mar 2021)

[Rajagopalan Ranganathan]

Sir,

According to rule 96A (1) of CGST Rules, 2017, any registered person availing the option to supply goods or services for export without payment of integrated tax shall furnish, a bond or a Letter of Undertaking prior to export. Therefore LUT executed will not cover exports made prior to execution of the LUT.

According to rule 96A (6) of the same rules the provisions of sub rule (1) shall apply, mutatis mutandis, in respect of zero-rated supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit without payment of integrated tax.

[KASTURI SETHI]

Sh.Krishna Panyam Ji,

I agree with the view of Sh.Ranganathan, Sir.

Delay is condonable in view of Board's circular mentioned in reply to earlier query. Export benefit be denied in case you have all other documentary evidence in support of actual export i.e. receipt of foreign exchange, invoice etc..

It depend on how you represent your case.

[KUMAR Narasimhan]

Dear Kasturi Sir and Ranganathan sir,

Thank you for clarifying me on the above.

[YAGAY and SUN]

In continuation to the reply of Kasturi Sir, in our view following two judgments will be beneficial to the export in this matter:-

M/s. JD Engineering v. CCE-New Delhi. 2015 (6) TMI 1218 - CESTAT, NEW DELHI - LUT Procedure lapse.

Commissioner Central Excise Commissioner Vs M/s Indian Oil Corporation Ltd.-2015 (5) TMI 100 - PUNJAB & HARYANA HIGH COURT (Punjab and Haryana High Court). Substantial benefit cannot be denied for mere procedural lapse: HC

[KASTURI SETHI]

M/s. YAGAY and SUN,

Sir, I want citation of both case laws. Will you please oblige me ? Thanks a lot.

AI Summary

Letter of Undertaking must be furnished before export; late execution generally won't cover earlier exports, though condonation may apply.
A registered person must furnish a bond or a Letter of Undertaking prior to export to supply goods or services without payment of integrated tax; an LUT executed later will not cover exports made before its execution, and the same requirement applies mutatis mutandis to zero-rated supplies to SEZ developers or units. Delay may be condonable where departmental circulars, supporting export documentation, and judicial precedent on procedural lapses are relevant.