GST on Goods Sale Outside India

By | May 2, 2022

Table of Contents

Case of GST on Goods Sale Outside India

The article explains GST Implications associated with the sale of products outside India with a sensible Case Study. The article has thought-about Advance Ruling of AAR Maharashtra within the case of INA Bearing Indian Country non-public restricted, within which mortal has raised the question that whether or not the sale of products, that are placed outside India, would be at risk of tax in India below section 7(5) (a) of Integrated product and Services Tax Act, 2017? Article conjointly thought-about Advanced ruling within the case of Ltd (AAR Kerala); Order No. CT/2275/18-C3; 26/03/2018. GST implication?

INA Bearing  India (P) Ltd.

  • A certain Indian Company engaged in the business of offering bearings and tools.
  • They need to be received an order from an Indian client for the tool.
  •  In turn, they need to place orders with foreign merchants for the manufacture of tools.
  • The tool was factory-made & was in possession of a foreign merchants.
  •  Foreign products raised invoice on INA (P) Ltd.
  •  At that point, INA Bearing India (P) Ltd. raised an invoice for an Indian client.
  •  As per Section 7(5)(a) of the IGST Act, give the export or import of products and/or services ought to be treated as inter-State group action.
  • Section 7(2) of the IGST Act, the offer of products foreign into the territory of  India until they cross the customs frontier shall be treated as offers of products within the course of inter-State trade or commerce.
  •  The stipulation to section 5(1) of the IGST Act states that only if the integrated tax on products foreign into India shall be levied and picked up in accordance with the provisions of section 3 of the Customs Tariff Act, 1975 on the worth as determined under the aforementioned Act at the purpose once product crosses the custom frontier.
  •  The possession of the aforementioned product gets transferred to the human with no physical movement of the products from Germany to India.
  • During this means, the foreign product sold-out from and to an exempt territory, tho’ they’re clearly within the nature of the inter-State offer, would be available in the class of exempt offer as no duty is leviable on them.


  • Cross-border transactions square measure being coated under Inter-State supply.
  • It covers beneath Zero-rated offers.
  • Hence, not nonexempt under the GST as per GST/ARA/04/2018-19/B-60.

Synthite Ltd.

  •  Merchandise procured from one country (China)
  •  Provided to a different country (USA)
  • Ltd. (India)
  • Place of offer ?
  •  As merchandise aren’t foreign into India at any purpose of your time, GST isn’t applicable as per order no. CT 12275/18-C3.
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Category: GST