Supply made to SEZ but LUT not file

[CASUNIL BHANSALI]

A company made supplies to a SEZ unit. However, the LUT for FY 2021–22 was filed after the said supply was made. Additionally, the company has not received the endorsement from the supplier. Further, these supplies were reported in GSTR-1, but not reported in GSTR-3B.

1. Is there any circular, clarification, or case law that supports the position where LUT was filed belatedly but the supplies were still made to SEZ for authorized operations?

2. Can it still qualify as a zero-rated supply despite the belated LUT and missing endorsement?

 

[KASTURI SETHI]

Q. No. 1 Answer is YES. Circular No. 125/44/2019-GST, dated 18-11-2019. Para No.44 refers. This circular has been amended vide the undermentioned circulars:-

197/09/2023-GST dated 17-07-2023: GST Refund - Refund of accumulated ITC under CGST Section 54(3) undertaking in FORM RFD-01, manner of calculation of adjusted Total Turnover and admissibility of refund where an exporter applied for refund subsequent to compliance – Clarification.

3/2022-GST (Instruction) dated 14-06-2022: Refund claims - Sanction, post-audit and Review of refunds - Instruction/Guidelines

147/03/2021-GST dated 12-03-2021: GST Refund - Refund claim by recipient of deemed export supply, zero-rated supplies has been wrongly declared and calculation of adjusted total turnover under CGST Rule 89(4) – Clarifications.

135/05/2020-GST dated 31-03-2020: GST Refund related issues – Clarification.

134/04/2020-GST dated 23-03-2020: Companies under Insolvency and Bankruptcy Code, 2016 - Clarification in respect of issues under GST law.

[Shilpi Jain]

Yes. Belated filing of LUT would max be a procedural aspect and should not deny the export benefits.

AI Summary

Zero-rated supply: belated LUT filing is procedural and should not defeat export benefits for SEZ supplies. Belated filing of a Letter of Undertaking for supplies to an SEZ is treated as a procedural irregularity and does not by itself deprive qualifying supplies of zero-rated character, subject to documentary and reporting compliance. Circular No.125/44/2019-GST and subsequent clarifications on refund procedures, adjusted turnover calculations, and post-audit/sanction of refunds are cited as authority; discrepancies between GSTR-1 and GSTR-3B reporting and absence of supplier endorsement remain material for refund adjudication and post-audit scrutiny.