Ravi Chandran (21 Points)
28 March 2023Please guide me the following queries.
1. I am a merchant exporter.
2. I will give a job to a factory to manufacturing some components for export to UAE.
3. The factory will purchase steel and other items.
In this case what about the GST to purchase the raw materials. Is it need to pay the IGST (18%) to the material seller. The order worth is nearby 1 crore. I not able to dumping 18 lac as GST.
Please guide and give your suggestions to fulfill the order.
Thanking you
D.Ravichandran
Coimbatore
Ashok
(Tax Payer)
(56 Points)
Replied 28 March 2023
If the factory is also in Coimbatore or anywhere in TN, they will issue you an invoice with SGST & CGST.
If you have any unpaid excess CGST liability, SGST input tax credit cannot offset CGST liability.
Coming to exports, IGST is 0% i.e you charge no GST on this order to your customer. So may be you have an option if you pay your inputs to your vendors would be to claim the unutilized ITC by filing a GST refund application accompanied by evidence.
If you file returns quarterly, see if you can offset this ITC towards any other orders from your other outward / customers invoices.
Ravi Chandran
(21 Points)
Replied 29 March 2023
The factory located in Hariyana and the raw material supplier I'm Mumbai. The said components should go to Dubai.
CAclubindia
