The procedure for deemed exports in India involves the following steps:
Eligibility
The supplier of goods or services must ensure that the recipient of goods or services is eligible for deemed export status. The eligible recipients include Export Oriented Units (EOUs), Special Economic Zones (SEZs), projects funded by multilateral or bilateral agencies, and certain categories of organizations specified by the government.
Tax Invoice
The supplier of goods or services must issue a tax invoice indicating that the supply is intended for deemed export. The invoice must contain details such as the name and address of the supplier and recipient, the description, quantity, and value of the goods or services supplied, and the applicable GST rate.
Certificate from Recipient
The supplier of goods or services must obtain a certificate from the recipient of goods or services confirming that the goods or services have been received for deemed export. The certificate must be in the prescribed format and must contain details such as the name and address of the supplier and recipient, the description, quantity, and value of the goods or services received, and the GSTIN of the supplier.
Refund/ Exemption of GST
The supplier of goods or services can claim an exemption or refund of GST paid on the supply of goods or services to the eligible recipient. The refund or exemption is available subject to certain conditions and procedures prescribed under the GST law.
Case Law on Contraventions
The GST law provides for penalties and prosecutions for contraventions of various provisions of the law, including deemed exports. Let us discuss some of the case laws on contraventions of deemed exports under GST:
M/s Sona BLW Precision Forge Ltd. vs The Deputy Commissioner (2019)
In this case, the supplier of goods had claimed exemption from GST on the supply of goods to an EOU. However, the EOU had sold the goods in the domestic market without payment of GST. The GST authorities had alleged that the supplier of goods had violated the deemed export provisions of the GST law by claiming exemption from GST on the supply of goods. The Hon'ble High Court held that the supplier of goods was not liable for any penalty or interest as the contravention was not willful or intentional.
M/s Rahul Impex vs The Commissioner of GST (2020)
In this case, the supplier of goods had supplied goods to an EOU without payment of GST. However, the supplier had not obtained a certificate from the EOU confirming that the goods were received for deemed export. The GST authorities had alleged that the supplier of goods had contravened the deemed export provisions of the GST law. The Hon'ble High Court held that the failure to obtain a certificate from the EOU was a technical violation and not a substantive violation. Therefore, the supplier of goods was not liable for any penalty or interest.
Conclusion
Deemed exports are an important provision under the GST law that aims to promote the export of goods and services from India. The procedure for deemed exports involves eligibility, tax invoice, certificate from the recipient, and refund/exemption of GST. Contraventions of deemed export provisions can result in penalties and prosecutions under the GST law. Therefore, businesses involved in deemed exports must ensure compliance with the provisions of the GST law to avoid any penalties or prosecutions.
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