TaxTMI 
TaxTMI 
Sir, A is having TIN no.in Delhi and he is having one office space out of india in bangkok.Now he has some deal whereby he wants to purchase from eaurope and sell in Dubai .What are the legal complications here as the goods will not come in india the material will be sent directly from eaurope to Dubai . the payment will be made in our favour by the purchasing party and the payment will be made from our account to the seller . now the question is whether there is any law applicability relating to the deal with regard to FEMA , VAT , etc . BAL KRISHAN GARG
Law applicability - FEMA, VAT
11 Sep 2009 
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VAT non applicability for direct offshore sales; foreign exchange rules may require approval for outbound remittances.
Where goods are purchased abroad and sold directly to a foreign buyer without entering India, domestic VAT does not apply because the supply occurs outside Indian territory. FEMA does not bar such transactions per se, but outward remittances or foreign exchange outflows tied to the purchase may require reporting or prior approval if they exceed permissible limits under the foreign exchange rules. (AI Summary)
Where goods are purchased abroad and sold directly to a foreign buyer without entering India, domestic VAT does not apply because the supply occurs outside Indian territory. FEMA does not bar such transactions per se, but outward remittances or foreign exchange outflows tied to the purchase may require reporting or prior approval if they exceed permissible limits under the foreign exchange rules. (AI Summary)