TaxTMI 
TaxTMI 
Clarification on issues related to furnishing of Bond/Letter of Undertaking for Exports
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....Excise & Customs vide F. No. 349/74/2017-GST(Pt.) Volt-Il-dated 4th October, 2017 on the subject above which is as under; In view of the difficulties being faced by the exporters in submission of bonds/Letter of Undertaking (LUT for short) for exporting goods or services or both without payment of integrated tax, Notification No. 37/2017 - Central Tax dated 4th October, 2017 has been issued which extends the facility of LUT to all exporters under rule 96A of the Central. Goods and Services Tax Rules, 2017 (hereafter referred to as "the CGST Rules") subject to certain conditions and safeguards. This notification has been .issued in supersession of Notification No. 16/2017 - Central Tax dated 7th July, 2017 except as respects things done o....
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....dity of LUT: The LUT shall be valid for the whole financial year in which it is tendered. However, in case the goods are not exported within the time specified in sub-rule (1) of rule 96A of the CGST Rules and the registered person fails to pay the amount mentioned in the said sub-rule, the facility of export under LUT will be deemed to have been withdrawn. If the amount mentioned in the said sub-rule is paid subsequently, the 'facility oft export under LUT shall be restored. As a result, exports, during the period from when the facility to export under LUT is withdrawn till the time the same is restored, shall be either on payment of the applicable integrated tax or under bond with bank guarantee. c) Form for bond/LUT: Till th....
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....e working days of its receipt along with the self-declaration as stated in para 2(d) above by the exporter. If the LUT / bond is not accepted within a period of three working days from the date of submission, it shall deemed to be accepted. f) Bank guarantee: Since the facility of export under LUT has been extended to all registered persons, bond will be required to be furnished by those persons who have been prosecuted for cases involving an amount exceeding Rupees two hundred and fifty lakhs. A bond, in all cases, shall be accompanied by a bank guarantee of 15% of the bond amount. g) Clarification regarding running bond: The exporters shall furnish a running bond where the bond amount would cover the amount of self-asses....
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.... them under GST regime. Therefore, supplies to EOUs are taxable like any Other taxable supplies. EOUs, to the extent of exports, are eligible for zero rating like any other exporter. k) Realization of export proceeds in Indian Rupee: Attention is invited to para A (v) Part-I of RBI Master Circular No. 14/2015-16 dated 01^St July, 2015 (updated as on 05th November, 2015), which states that "there is no restriction on invoicing of export contracts in Indian Rupees in terms of the Rules, Regulations, Notifications and Directions framed under the Foreign Exchange Management Act, 1999, Further, in terms of Para 2.52 of the Foreign Trade Policy (2015-2020), all export contracts and invoices shall be denominated either in freely convertib....