TaxTMI 
TaxTMI 
Can we Export against the rejected material on FOC basis
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....an we Export against the rejected material on FOC basis<br> Query (Issue) Started By: - Swapneswar muduli Dated:- 17-11-2016 Last Reply Date:- 18-11-2016 Central Excise<br>Got 3 Replies<br>Central Excise<br>Dear Sir, We had exported some goods under LUT and we received the payment for the same. But after some months the customer raised question that our material are rejected so they want same qua....
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....ntity of material replacement on FOC basis. We don't bring material back to our factory from the customer because these material are not good and also transportation cost will be high compare to this material. My query is can we send these replacement material to customer on Free of cost basis under LUT. and the above transaction which we takes place for replacement is correct or not ? Rega....
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....rds Swapneswar Muduli Reply By Rajagopalan Ranganathan: The Reply: Sir, You can export replacement goods FOC under LUT. But you will not receive any payment for such replacement. You should be careful how to satisfy RBI regarding this export without any realization under FEMA? Reply By MUKUND THAKKAR: The Reply: you can export on FOB basis as replacement as explain by sir, but as and when yo....
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....u can genrate export invoice please clearly mention on body of invoice free of cost. so you can explain concern authority in future.. Reply By surya narayana: The Reply: Dear Friend, Please note there is no bar for exporting material on FOC under central Excise. However, while doing such transaction you need to take care on the following : 1. Valuation aspect since sale is not involved in suc....
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....h transactions 2. Mentioning on ARE1 and invoice as Free supply and not for sale 3. Obtaining a GR waiver from RBI or the Authorized dealer Bank as per the permissible value limits as there is a prescribed limit for GR waiver i.e, in other words value limit for free of cost supply. Best Regards Suryanarayana<br> Discussion Forum - Knowledge Sharing ....