EXPORT OF GOODS

[RAJESH LANGALIA]

One GST registered supplier has received an order of supply of steel plates (along with some specific cutting work on steel plates as required by the buyer using CNC machine) from a foreign buyer and it will pay the proceeds in convertible foreign exchange. The goods will be made available ex-factory i.e. buyer will take the goods from factory on its own and will send it outside india. The question is whether this supply will be considered as an export for the Indian registered supplier? please reply with references to law. thanks in advance .

[Raam Srinivasan Swaminathan Kalpathi]

Export of goods is defined in Sec. 2(5)IGST Act, which simply states - export of goods with its grammatical variations and cognate expressions means taking goods out of India to a place outside India.  Even realisation in convertible foreign currency is restricted only to services and not to goods.  Two other Rules which will have a direct impact is Rule 96A and Rule 96B of CGST Rules which you may go through.  Therefore cutting the long story short, whether terms of export are on CIF, FOB or ex-works, all are considered as export of goods as long as the exporter possesses the GST invoice, Shipping Bill and Bill of Lading. 

[KASTURI SETHI]

Dear Querist,

This will be treated as export of goods. I support the views of Sh.Kalpahi Ji. In addition to the receipt of export proceeds, you should also  emphasize on identification  marks of goods exported. These should match with transportation docs. Thus you will be able to establish the actual exportation of the said goods.

[Raghunandhaanan rvi]

Based on the information, a GST-registered supplier has received an export order to supply steel products to a foreign buyer on an ex-works basis, with payment received in foreign exchange. The question is whether this supply qualifies as an "export." According to the information, this supply would indeed be considered an "export" because the goods are being taken to a location outside India. The goods can be exported under a LUT or by paying IGST and claiming a refund through customs. The buyer is responsible for transportation, insurance, and customs clearance costs in this scenario.

[Shilpi Jain]

Ensure that the shipping bill is filed in the name of the Indian supplier.

[RAJESH LANGALIA]

I thank all of you for your sincere reply and appreciate sharing of time and knowledge for me. Thank you all once again from the bottom of my heart. 

AI Summary

Export of goods qualifies where goods are taken out of India; ensure shipping bill and export documentation. Export status turns on physical removal of goods from India; ex-works supplies qualify as export if goods are taken outside India. Realisation in convertible foreign exchange is not required for goods. Supplier must hold GST invoice, Shipping Bill filed in supplier's name and Bill of Lading, with identification marks matching transport documents. Export may be effected under a Letter of Undertaking or by paying IGST and claiming refund through customs; under ex-works the buyer ordinarily handles transport, insurance and customs clearance.