We are availing SSI exemption and have a sale which is billed to a company in Germany but delivered in IIT Hyderabad.
So the sale is in foreign exchange (Euro) but we are charging VAT 12.5% (again in Euro) as we are told that is the rule, as the consignment is going to India only
Will this be considered as Export or home consumption?
Pl advice.
Company's Euro-Paid Indian Delivery Is 'Deemed Export' Under Foreign Trade Policy, Eligible for Export Benefits. A company is utilizing Small Scale Industry (SSI) exemption and has a transaction billed to a German company, with delivery in India, paid in Euros. They are charging 12.5% VAT in Euros, questioning if this is considered an export or domestic sale. An expert clarifies that under the Foreign Trade Policy, such transactions are 'Deemed Exports,' where goods remain in India but payment is in foreign currency, allowing export-related benefits. It is advised to review the Foreign Trade Policy, MVAT Act, and consult with legal counsel to confirm eligibility for these benefits. (AI Summary)
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