GSTR-1 Reporting of Sales made by SEZ to DTA unit

[Saikrishnan]

Dear Forum,

My client is based out SEZ and they have made scrap sales to DTA based vendor, BOE is filed and Customs duty plus IGST is also paid.

My query is how this sales should be reported in GSTR-1..??

[Sadanand Bulbule]

Report it as regular inter-state B2B taxable supply in GSTR-1, against the GSTIN of the DTA buyer.

[Raam Srinivasan Swaminathan Kalpathi]

Dear Querist

I beg to differ from the opinion provided by respected Sri.Sadanandji. Supply from SEZ to DTA goes through ICEGATE-II portal and has nothing to do with the GST Acts. This is therefore a non-GST supply to be reported either in Table 8A if the recipient is registered or Table 8C if the recipient is unregistered. Thanks

[Sadanand Bulbule]

The provisions of Section 7(5)(b) of the IGST Act and Section 3(7) of the Customs Tariff Act be conjointly read to reach remedy.

[YAGAY and SUN]

In the case of scrap sale by an SEZ unit to a DTA buyer, where the DTA buyer has filed a Bill of Entry (BOE) and paid the applicable Customs Duty and IGST, the transaction is treated as an import by the DTA unit under the SEZ provisions.

For GST reporting purposes:

• The SEZ unit is generally not required to charge GST on the invoice, as the IGST is discharged by the DTA buyer at the time of BOE filing.

• Since tax is paid through Customs and not through the SEZ supplier's GST return, the transaction should not be reported as a normal taxable B2B supply in GSTR-1.

• Such supplies are typically reported under Table 6C - Supplies to SEZ/deemed exports? No, this table is not applicable because the supply is from SEZ to DTA.

• In practice, many professionals report these transactions in Table 8 [8A/8C] (Nil Rated/Non-GST/Exempt supplies) under the appropriate category, or keep them outside the taxable outward supplies reported in GSTR-1, while maintaining complete documentation (invoice, BOE, assessment documents, and proof of duty payment).

The key point is that IGST has already been collected through Customs on the BOE, and the DTA buyer claims credit based on the BOE, not on the SEZ supplier's GST invoice.

Before finalizing the return, verify whether the jurisdictional officer or internal compliance policy prefers disclosure in Table 8 for reconciliation purposes, as there has been some divergence in practical reporting approaches. However, it should not be reported as a regular taxable B2B supply on which the SEZ unit pays GST through GSTR-3B.

[Shilpi Jain]

SEZ is not required to report this. look at the instructions in GSTR-1

[MuraliMohanReddy Guntaka]

In addition to the above question, A sale of Motor vehicle was made by a SEZ unit to an individual and IGST is not applicable as the margin is negative (in light of Notification No 9/2018 - IGST (rate) and that individual didn't file any Bill of entry. In this scenario how to report this transaction in GSTR 1

[Raam Srinivasan Swaminathan Kalpathi]

As the taxable value is 'Nil' there is no necessity to report the transaction GSTR-1 or 3B.

AI Summary

SEZ to DTA supply reporting in GSTR-1 remains disputed, with views ranging from nil disclosure to Table 8 treatment. SEZ supplies of scrap to a DTA buyer, where the buyer files a Bill of Entry and pays customs duty and IGST, raise the reporting position in GSTR-1. The discussion records competing views: one view treats the transaction as not requiring disclosure in GSTR-1 or GSTR-3B because tax is discharged through customs and the taxable value is nil; another view says the SEZ supplier should report it as a regular inter-state B2B taxable supply; and a further view suggests disclosure under Table 8 as a nil-rated, exempt, or non-GST supply.