We have used some imported duty paid goods in the manufacture of export product. We have not taken input tax credit of the IGST paid on the imported inputs. Can we get drawback of the same?
No. The definition of drawback given at Rule 2(a) of Customs and Central Excise Rules, 2017 is as follows: “drawback” in relation to any goods manufactured in India and exported, means the rebate of duty excluding integrated tax leviable under sub-section (7) and compensation cess leviable under sub-section (9) respectively of section 3 of the Customs Tariff Act, 1975 (51 of 1975) chargeable on any imported materials or excisable materials used in the manufacture of such goods. So, IGST paid on imported inputs is specifically excluded in the definition of duty drawback.
We were issued an EPCG authorisation, where the export obligation (EO) period has expired. We have fulfilled EO of only 30 per cent. Due to cash crunch, we are considering depositing only custom duty proportionately (70 per cent of duty saved) so that interest liability does not mount and pay the interest when our cash situation eases. We apprehend that the Customs may first adjust the amount so deposited towards interest. Is there any provision to prioritise such payments?
The customs duty and interest have to be deposited under different accounting heads. So, I do not think the Customs will mix up the Customs duty with interest.
As merchant exporters, we purchased export goods from another party on payment of 0.1 per cent GST. We have mistakenly exported the goods on payment of IGST instead of exporting without IGST under LUT. This mistake was repeated over the last four months. What are the consequences? Should we declare this error on our own to the jurisdictional GST office?
In case you have not received the refund, you can make amendments to the taxable outward supply details furnished in Table 6 in the GSTR-1 returns for earlier tax periods, through Table 9 of the GSTR-1 returns. In case you have received the refunds, you have to surrender the same, as you are not entitled to refund by virtue of Rule 96 (10) (a) of the CGST Rules, 2017.
We have an art gallery. Many foreigners and non-resident Indians buy paintings at the gallery and pay in foreign exchange. We understand that they can get rebate of the GST that we charge them, when they leave India. Is this so?
As per Section 15 of the IGST Act, 2017: “The integrated tax paid by tourist leaving India on any supply of goods taken out of India by him shall be refunded in such manner and subject to such conditions and safeguards as may be prescribed. Explanation: - For the purposes of this section, the term “tourist” means a person not normally resident in India, who enters India for a stay of not more than six months for legitimate non-immigrant purposes.” However, the government has not issued any notification giving effect to the above provisions.