Bill to ship to where bill to party is outside India

[Veenaa Venkatesh]

In case a supplier in India ships goods to a person in India on the direction of his customer located outside India, what are the GST implications in terms of nature of supply and person liable to pay ?

[KASTURI SETHI]

Goods must be taken out of India otherwise it is not export of goods.

[KASTURI SETHI]

For detailed reply,  please elaborate your query with full facts.

[Sadanand Bulbule]

Dear querist

It is as good as domestic supply of goods either inter-state or intra-state depending upon the origin and destination of goods. Accordingly you have to charge applicable tax. In no way, such transaction can be termed as export.

[Raam Srinivasan Swaminathan Kalpathi]

Dear Querist

Have no qualms about this supply.  This supply is either inter-state or intra-state and will suffer GST.  Period. 

To digress, you have a larger problem at hand.  The moneys have realised in foreign currency - meaning thereby - an IRM has been created at the EDPMS portal of RBI.  You will not be able to square this with a shipping bill as the supply is domestic.  Kindly talk to your bankers on this also.  Thanks

[Veenaa Venkatesh]

Yes sir. Agreed that it is not an export. My doubt was which clause of Section 10 of the IGST Act has to be seen to determine the place of supply? Also, is the foreign customer liable to take registration ?

[KASTURI SETHI]

Q. Is the foreign customer liable to take registration ?

A.  The jurisdiction of GST Acts is extended to the whole of India and not outside India.

Why do you think so that the buyer located in a foreign country should take GST registration ?   

[Shilpi Jain]

Section 10(1)(a) would be applicable

The place of supply of goods, other than supply of goods imported into, or exported from India, shall be as under,––

(a) where the supply involves movement of goods, whether by the supplier or the recipient or by any other person, the place of supply of such goods shall be the location of the goods at the time at which the movement of goods terminates for delivery to the recipient;

[Veenaa Venkatesh]

Sir, for the supply of goods by foreign party to ultimate customer in India is GST payable since supply is happening in taxable territory? If so, who is liable to pay?

Also, Ma'am the reason we are looking at 10(1)(a) and not 10(1)(b) is because the bill to party is unregistered? Will insertion of 10(1)(ca) have an impact?

AI Summary

GST on Domestic Shipments for Foreign Customers: Section 10 IGST Act Clarifies Place of Supply and Tax Liability A discussion on the Goods and Services Tax (GST) implications for a supplier in India shipping goods domestically on the direction of a foreign customer. Participants clarified that such transactions are considered domestic, either inter-state or intra-state, and not exports, thus subject to applicable GST. Concerns about foreign currency payments and their implications on the RBI's EDPMS portal were raised, advising consultation with bankers. The applicability of Section 10 of the IGST Act was discussed to determine the place of supply, with emphasis on Section 10(1)(a). Questions about the foreign customer's GST registration liability were addressed, noting the GST jurisdiction is limited to India.