Page 19 - Craftcil July 2017
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              • Deemed Export Drawback: The drawback as provided under Chapter 7 would be limited to the refund of basic
                custom duty only. In respect of eligible items covered under Schedule 4 of Central Excise Act, 1944 refund would
                also be covered under the drawback provided the item is eligible for such supply.
              • The TED refund: TED refund would be available only if exemption is not available in respect of items covered
                under Schedule 4 of Central Excise Act, 1944 provided the items are eligible for supply under the said category
                of deemed exports

             Impex # 2          Issue related to exports without payment of Integrated Tax resolved
           CBEC issues GST Circular             GST Scheme is the biggest indirect tax reform in India since independence
           clarifying that exports can be       that has been introduced with effect from 01-07-2017. It is set to transform
                                                India's business landscape. When such is the upheaval, some hiccups could
           made without payment of
                                                be expected here and there.
           integrated tax by furnishing
                                                One such problem was faced by the exporters (immediately after
           Bond or Letter of Undertaking
                                                commencement of GST Scheme on 01-07-2017) in exporting in the usual
           (LUT) in Form GST RFD-11.
                                                manner as before 01-07-2017. They were asked to pay Integrated GST or give
           bond / LUT. Confusion prevailed in customs also and exports came to a standstill. This happened because the
           exporters were not aware/made aware that after introduction of GST, exporters were required to give bond/LUT as
           per rule 96A of CGST in Form GST RFD-11. Customs officers were also not well equipped in this respect.
           The difficulty was, however, solved quickly by CBEC by issue of two GST Circulars Nos. 2/2/2017-GST dt. 04-07-2017 and
           4/4/2017-GST dt. 07-07-2017 wherein the issue was clarified.
           Copy of CBEC Circular No. 4/4/2017-GST dt. 07-07-2017 referred to above is reproduced below:

                                        Copy of CBEC Circular No. 4/4/2017-GST dt. 07-07-2017
            Subject: Issues related to Bond/Letter of Undertaking for exports without payment of integrated tax - Reg.

              Various communications have been received from the field formations and exporters that difficulties are being
              faced in complying with the procedure prescribed for making exports of goods and services without payment of
              integrated tax with respect to furnishing of bonds/Letter of Undertaking. Therefore, in exercise of powers
              conferred under section 168 (1) of the Central Goods and Services Tax Act, 2017, for the purpose of uniformity in
              the implementation of the Act, these issues are being clarified hereunder.
            2. As per rule 96A of the Central Goods and Services Tax Rules, 2017 ( The CGST Rules), any registered person
              exporting goods or services without payment of integrated tax is required to furnish a bond or a Letter of
              Undertaking (LUT) in FORM GST RFD-11.
            3. Attention is invited to notification No. 16/2017-Central Tax dated 01-07-2017vide which the category of exporters
              who are eligible to export under LUT has been specified along with the conditions and safeguards. All exporters,
              not covered by the said notification, would submit bond. The procedure for submission and acceptance of bond
              has already been prescribed vide circular No. 2/2/2017-GSTdated 4th July, 2017.The bond shall be furnished on
              non-judicial stamp paper of the value as applicable in the State in which bond is being furnished.
            4. A clarification has been sought as to whether the bond to be furnished for exports is a running bond (with debit /
              credit facility) or a one-time bond (separate bond for each consignment / export). It is observed consignment
              wise bond would be a significant compliance burden on the exporters. It is directed that the exporters shall
              furnish a running bond, in case he is required to furnish a bond, in FORM GST RFD -11. The bond would cover the
              amount of tax involved in the export based on estimated tax liability as assessed by the exporter himself. The

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