What rate of Vat applicable Goods supplied within India but Sales Proceeds received from aborad - Foriegn Currency?

[Ravi chandran]

Dear Sir

We are CNC machine Dealer our office is situated in Chennai (Tamil Nadu)

We have received a purchase order from our customer at Taiwan to supply of UCAM table for 

CNC machine, the order value is in USD dollars, later they advised us to supply the Goods to

their customer in Tamil Nadu. We already received advance from our Taiwan Customer in

foreign Currency (US Dollars as per the Purchase Order)

Now we have to supply the Goods as per our customer advise to their customer in Tamil Nadu,  

1. In whom favour (Name)  should we raise the sales Invoice?

2. In which currency should we raise the sales Invoice - whether in INR or USD?

3. Whether Local Sales Tax (VAT 5%) is applicable or Not? if not under which gound we can

     avail tax exemption?

Kindly Advise Imtly

Thanks & Regards

T. Ravi Chandiran

AI Summary

CNC Machine Dealer Faces Confusion Over VAT and Invoicing for International Order; Legal Counsel Advised for Clarity. A CNC machine dealer in Chennai received a purchase order from a Taiwanese customer to supply goods to a customer in Tamil Nadu, with payment in USD. The dealer inquired about invoicing and VAT applicability. One response suggested treating the transaction as a deemed export, invoicing the foreign party in USD, and not charging VAT. Another response indicated it should be treated as a local sale under Tamil Nadu VAT, suggesting billing in INR for VAT filing, despite payment in foreign currency. Both responses advised verifying with legal counsel and reviewing relevant trade policies.