The Central Government, vide Circular No. 14/14/2017– GST dated 6th November 2017, prescribes detailed procedure on procurement of supplies of goods from Domestic Tariff Area by Export Oriented Unit (EOU) / Electronic Hardware Technology Park (EHTP) Unit / Software Technology Park (STP) Unit / Bio-Technology Parks (BTP) Unit under deemed export concept as provide in section 147 of CGST Act, 2017.
Export Oriented Unit
It is an inclusive definition and includes an Export Oriented Unit (EoU) or Electronic Hardware Technology Park Unit (EHTP) or Software Technology Park Unit (STP) or Bio-Technology Park Unit (BTP) approved in accordance with the provisions of Chapter 6 of the Foreign Trade Policy 2015-20.
Deemed Exports –
Section 147 of the Central Goods & Services Act, 2017, provides that, the Central Government may, on the recommendations of the Council, notify certain supplies of goods as deemed exports, where goods supplied do not leave India and payment for such supplies is received either in Indian Rupees or in convertible foreign exchange, if such goods are manufactured in India.
The Central Government, on the recommendations of the GST Council, notifies certain goods vide Notification No. 48/2017-Central Tax dated 18th October 2017 as “Deemed Exports” namely – Supply of:
1. Goods by a registered person against Advance Authorization
2. Capital goods by a registered person against Export Promotion Capital Goods Authorization
3. Goods by a registered person to Export Oriented Unit
Export Oriented Unit
Means an Export Oriented Unit or Electronic Hardware Technology Park Unit or Software Technology Park Unit or Bio-Technology Park Unit approved in accordance with the provisions of the Foreign Trade Policy 2015-20.
Benefits for Deemed Exports
Deemed exports shall be eligible for any / all of following benefits in respect of manufacture and supply of goods, qualifying as deemed exports:
- Advance Authorization / Advance Authorization for annual requirement / DFIA.
- Deemed Export Drawback.
- Refund of terminal excise duty, if an exemption is not available. Refund of tax paid on Supplies
- Refund of tax paid on such supplies can be claimed either by the recipient or supplier of such supplies.