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Manufacturing of Die (which will not physically exported to the foreign customer) will considered as an intra-State supply, he has to collect the CGST and SGST and discharge the liability

Authority for Advance Ruling — Taxability on Die for Castings, not Physically Exported or Imported – The applicant exports Aluminium and Zinc die Castings. The applicant retains the Steel Die till the completion of the export order or completion of the life of the die. The applicant raised the tax invoice for the steel die, though the die not physically exported. After completion of the export order or completion of the life of the die, the applicant either export the dies or scrap the die at their end as per the instructions of the customer. The applicant sought an advance ruling as to (i) whether the applicant raise the tax invoice addressed to the foreign buyer and delivery to applicant works by paying output GST and claiming back by the applicant as input GST or (ii)whether applicant raise self-invoice by paying the output GST and claiming back by the applicant as input GST or (iii) whether the applicant raise the tax invoice addressed to the foreign buyer by paying the output GST under reverse charge mechanism(iv)Applicant seeks the procedure to be followed under GST Act for discharging GST liability. Similarly, the applicant imports castings. The foreign supplier retains the steel die till the completion of the order or completion of the life of the die. The supplier raised the tax invoice for die though the die not physically imported. The applicant sought an advance ruling as to (i) whether the applicant account the purchase commercial invoice and pay the GST under reverse charge mechanism (ii) applicant seeks the procedure to be followed under GST Act for discharging GST liability.
Held that:- The Hon’ble Authority for Advance Ruling held that in case of export, the supply is an intra-State supply and the applicant is liable for CGST and SGST and not eligible for ITC. If the steel die is scrapped, he has to issue intra/interstate invoice depending upon the nature of the transaction. Further, in the case of import, if applicant physically imports the Die, then he has to pay the IGST on RCM basis and eligible for ITC subject to conditions. If the steel die is scrapped, outside India, then such transaction is not under the purview of GST.—Dolphine Die Cast (P) Ltd., In Re… [2020] 24 TAXLOK.COM 025 (AAR-Karnataka)