GST on sale of goods lying in customs warehouse, before payment of customs duty

[Aap Consulting Pvt. Ltd.]

Dear Experts

Please guide. X imports goods in India and files Bill of Entry for Home Consumption; the goods are lying in Customs Warehouse pending payment of duty. Before payment of duty, X sells goods to Y; however after the sales X pays the Customs Duty and gets OOC. Now the questions are:

1. Whether sales from X to Y will be liable to GST?

2. Is there any legal prohibition under Customs Act or GST Act on sale of goods imported pending clearance?

3. If the import is completed only after payment of duty, then this sales from X to Y would be domestic sales or high sea sale?

AI Summary

GST implications for sale of warehoused imported goods before duty payment and out-of-charge clearance GST implications arise where imported goods filed for home consumption remain in a customs warehouse pending duty payment, but are sold before out-of-charge clearance. The issues concern whether the transfer attracts GST, whether the Customs Act or GST law prohibits such a sale, and whether the transaction is a domestic sale or a high sea sale when import completion occurs only after duty payment and clearance.