TCS on deemed export

[JOHN SHANNEL]

Hi All,

We are supplying products (Liquor) to airlines. Being deemed export is there TCS applicable? Can you advice?

[SOWMYA CA]

As per section 52, Every electronic commerce operator not being an agent, shall collect an amount calculated at such rate not exceeding one per cent. Therefore TCS provisions are applicable if you are an Ecommerce operator only. There is no TCS on deemed export. I think you are referring to subsidised rate for Merchant Export @ 0.1% for exports. You cannot avail concessional rate of 0.1% for supplies to airlines.

[JOHN SHANNEL]

Thanks for the reply. Still would like to have further clarification.

we are supplying liquor and charging TCS on sales of liquor to distributor/wholesales. In case of sales of liquor to deemed export does TCS provision applies. Pls help on the clarification.

[Raghunandhaanan rvi]

TCS is applicable to this supply of goods. It cannot be termed as 'deemed export' as this supply does not fall under the definition of deemed export as per FTP or GST law. Goods are also not taken to a place outside India, thus not termed as export as per the customs act. This is my view, Sir.

AI Summary

TCS applicability on deemed exports: supplies to airlines treated as domestic sales may attract TCS, not concessional export rate.
TCS applicability to supplies of liquor to airlines hinges on whether those supplies qualify as deemed export or export; section 52's TCS obligation applies to electronic commerce operators and there is no automatic TCS exemption for deemed exports, while one view in the discussion holds such supplies do not meet FTP, GST or customs definitions of export and therefore remain subject to TCS.