Exporters want early resolution of bond/LUTs confusion: FIEO

Exporters are facing problems due to lack of clarity on norms relating to submission of bonds or legal undertakings for clearance of export consignments post GST, the FIEO said today.
The Federation of Indian Export Organisations (FIEO) has asked the Finance Ministry to issue clarifications with regard to bonds and legal undertakings (LUTs).
Under the Goods and Services Tax (GST), an exporter can get exemption from payment of IGST if he/she submits bonds or LUTs.
In case the IGST has been paid, exporters can seek refund of the tax paid, according to a Customs circular on export procedure in the GST regime.

However, it is not clear like who would have to submit bonds and whether the bond should be accompanied by a bank guarantee, FIEO Director General Ajay Sahai told PTI.
He also said that exporters are facing numerous problems as field formations of customs are not aware of the changes made in the recent past.

"Confusion is prevailing with regard to execution of bond/LUT. While some clarifications have been provided, yet it is not made clear which category of exporters will give LUT and who will give bond.
"Some field formations are insisting for separate bond/LUT for each consignment which only adds to paper work at both the ends," he added.

IGST is levied on the supply of any goods and services in the course of inter-state trade or commerce. As per the IGST Act, export and import of goods and services are deemed to be a supply in the course of inter-state trade or commerce.
In a letter to CBEC, the FIEO said the goods are stuck at factory gates due to confusion with the field formations and it needs to be resolved expeditiously.
"I request for an early clarification so that export movement is seamless," Sahai said.