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GST on goods not entering in India

sameer shaikh (Accountant) (66 Points)

30 October 2024

Dear Expert,

We purchased goods from china and directly dispatched to germany, goods did not enter in India. Please let us know GST impact on this transaction. We need to pay GST?
How will we show this transaction in accounting?
How will we show this transaction in GST Return?

Thank you.

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3 Replies

Rama chary Rachakonda (Master in Accounts & Lawyer email ID:ramachary64@gmail.com voice no:9989324294) (5309 Points)
Replied 30 October 2024

Since the goods didn't enter India, this transaction is considered an export.

As per GST laws, exports are zero-rated supplies, meaning no GST is payable.

However, you may need to provide documentation to prove the goods were directly dispatched to Germany and didn't enter India.

This could include: - Commercial invoices - Bill of lading or airway bills - Customs documents For accounting purposes, you can record the transaction as: -

Sales (export) - XXX (value of goods) - Receivables (XXX) In your GST return (GSTR-3B), report this transaction as: -

Exports (zero-rated supplies) - XXX (value of goods) Additionally, you may need to file an export declaration (Table 6A of GSTR-1) and provide details of the export

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Rajendra Prasad (Employee Private) (1867 Points)
Replied 01 November 2024

As per Clause 7 of Sehedule III of CGST Act such transaction has been classified as "Neither a supply of goods nor a supply of services". Hence there is no any GST liability. And has to show the transaction as Non-GST transaction in the books of accounts and also in return.