Circular No.ES/102/2019-20 July 25, 2019
To: Members of the Council
Sub.: Clarification on applicability of Notification No. 45/2017-Customs dtd. 30.6.2017 on goods which were exported earlier for exhibition purpose/consignment basis
CBIC had issued Circular No. 108/27/2019-GST dated 18th July, 2019 clarifying the activity of sending the goods out of the India for Exhibition or on consignment basis for export promotion, except when such activity satisfies the test laid down in “Schedule I” of the CGST Act, do not constitute supply as the said activity does not fall within the scope of Section 7 of the CGST Act as there is no consideration at that point in time. It is further clarified that since the activity is not a supply, the same cannot be considered as Zero-rated supply as per the provision of Section 16 of the IGST Act.
Now, Board has issued Circular No. 21/2019- Customs dated 24th July, 2019 clarifying about applicability of Notification No. 45/2017-Customs dtd. 30th June, 2017 on goods which were exported earlier for exhibition purpose/consignment basis.
As per Sl. No. 1(d) of Notification No. 45/2017-Customs dated 30th June, 2017 requires payment of integrated tax at the time of re-import that was not paid initially at the time of export, for availing exemption.
For re-import of specified goods, no integrated tax was required to be paid for specified goods at the time of taking these out of India, the activity being not a supply; hence the said condition requiring payment of integrated tax at the time of re-import of specified goods in such cases is not applicable.
Even though those specified goods were exported under LUT, re-import cases of such goods will fall under residuary entry at Sl. No. 5 of Notification No. 45/2017-Customs
If exports have been made to related / distinct persons / principals / agents, for participation in exhibition or on consignment basis, but such goods exported are returned after participation in exhibition or the goods are returned by such consignees without approval or acceptance,
Re–import of such goods after return from such exhibition or from such consignees will be covered by entry at Serial No. 5 of Notification No. 45/2017 dated 30.06.2017, provided re – import happens before six months from the date of delivery challan.
The above clarification shall apply to all pending matters involving similarly placed exporters and importers, as the case may be.
Members may kindly make a note of the above.