LUT

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This query is : Resolved

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This discussion clarifies the requirement for LUT (Letter of Undertaking) when supplying goods to merchant exporters. It's clarified that the merchant exporter, not the supplier, typically needs to execute the LUT. If a LUT is not furnished, IGST will be applicable on the transaction. The applicability of IGST also holds true even if both parties are in the same state, as export transactions are considered inter-state.

Jignesh Shah

Jignesh Shah (Querist)

07 September 2020 WE SUPPLY GOODS TO MERCHANT EXPORT @ 0.1%. IS IT COMPULSORY FOR US TO TAKE LUT OR WE DOES NOT WANT TO TAKE LUT

Piyush Verma

Piyush Verma (Expert)

07 September 2020 If you do not furnish LUT then you will have to pay IGST.

Jignesh Shah

Jignesh Shah (Querist)

07 September 2020 THANKS FOR THE REPLY. WE AND THE MERCHANT EXPORTER IN THE SAME STATE THEN ALSO IGST APPLICABLE. FURTHER IF LUT IS NOT TAKEN ALSO FOR PREVIOUS YEARS SHALL WE HAVE TO PAY FULL TAX AS OUR PRODUCT IS @ 18% GST

Piyush Verma

Piyush Verma (Expert)

07 September 2020 You need to check whether such transaction of sale to Merchant exporter qualified as 'sale in the course of export' or not as per the underlying conditions prescribed in GST legislation. IGST applied in case of Export/Import transactions, as such transactions are never being considered as Intra-State transactions.
GST portal will not permit you to file LUT for previous years now.