Sales tax applicability on export

[Guest]

We would be selling our products to a company that is based in the USA and receiving the payment in foreign exchange. However, our buyer has instructed us to dispatch the materials to a warehouse in SEZ. The export invoice /packing list etc. have the name of the buyer as our customer in the USA but the consignee is the warehouse in SEZ a/c buyer name. ARE1 and Bill of Export is also being filed. Our buyer states that no sales tax is payable as this is export transaction. Buyer can not issue Form I as he is not an Indian company & the warehouse in SEZ cannot issue Form I as they are only providing warehousing service and not consuming the materials. Please advice whether we have to charge sales tax or not ?

AI Summary

Sales Tax Dispute: U.S. Buyer Claims Exemption in SEZ; Section 5 CST Act Considered in Export Transaction Debate. A company is selling products to a U.S.-based buyer and dispatching them to a warehouse in a Special Economic Zone (SEZ) in India. The buyer claims no sales tax is due, as it is an export transaction, but cannot issue Form I since they are not an Indian company, and the SEZ warehouse only provides storage services. A respondent suggests the transaction may meet the conditions of section 5 of the CST Act, implying no local tax applies. Another individual from an e-commerce company faces a sales tax demand due to non-acceptance of courier airwaybills as proof of export, seeking advice to avoid penalties.