Supply to SEZ
Query (Issue) Started By: – Ethirajan Parthasarathy Dated:- 3-8-2018 Last Reply Date:- 5-8-2018 Goods and Services Tax – GST
Got 4 Replies
GST
As per section 16 of IGST Act, supplies made to SEZ units & SEZ developers are treated as “zero rated supply”. But in the recent decision of AAR West Bengal in the case of Garuda Power Private Limited has ruled that :
The Applicant shall be liable to pay tax when supplying to Units and Developers of Special Economic Zones subject to the provisions of section 16 of the Integrated Goods and Services Act, 2017.
I request to learned friends to throw light on the meaning of ruling by AAR
Reply By Rajagopalan Ranganathan:
The Reply:
Sir,
Section 16 of IGST Act, 2017 stipulat
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uards and procedure as may be prescribed, without payment of integrated tax and claim refund of unutilised input tax credit; or
(b) he may supply goods or services or both, subject to such conditions, safeguards and procedure as may be prescribed, on payment of integrated tax and claim refund of such tax paid on goods or services or both supplied,
in accordance with the provisions of section 54 of the Central Goods and Services Tax Act or the rules made thereunder.
The sanction of refund will be governed by provisions of Section 54 of CGST Act, 2017 and rule 96 and 96A of CGST Rules, 2017.
Reply By YAGAY andSUN:
The Reply:
You may claim refund on such paid IGST.
Reply By ANITA BHADRA:
The Reply:
In re Garuda Power Private Limited (G
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ecision before any authority under any provisions of the GST Act.
The officer concerned raises no objection to admission of the Application.
Since the Applicant supplies to units and developers of Special Economic Zones only, as stated in the Application and reiterated by the authorised representative during Personal Hearing, the provisions of Section 16 of IGST Act will be applicable in this case and the tax liability will be at zero rate under sub section 1(b) of the IGST Act.
He may supply without paying tax subject to the provisions under section 16 (3) (a), or he may supply on payment of tax and claim refund subsequently under section 16 (3) (b) of the IGST Act.
Reply By DR.MARIAPPAN GOVINDARAJAN:
The Reply:
I endorse the views of
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