LUT for Export of services without payment of duty

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This discussion addresses whether IGST payment is required for services exported in July 2021 when the LUT (Letter of Undertaking) was only applied for in October 2021. While exporting services generally allows for duty-free export, the timing of the LUT application is crucial. It's advised that the IGST for July might need to be paid, with a subsequent refund claim, and proper documentation for export is essential.

Sonnal Khandaray

Sonnal Khandaray (Querist)
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20 November 2021 Dear All

One of client is into providing technical services to clients located in United states. He has raised an invoice in the month of July -21 but at that time he has not applied for LUT. but shown in return as without payment of duty.
He applied for LUT in the month of Oct -21.
Do he need to make payment of IGST for the month of July -21?

Thanks in advance

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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20 November 2021 Yes, pay and apply for refund.

CA Altamush Zafar

CA Altamush Zafar (Expert)
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20 November 2021 No need to pay GST since the services were exported. I would advice you to have proper documents as evidence that the services were actually exported. Late filing of LUT is a procedural lapse and can be condoned.

CA Raj Doshi

CA Raj Doshi (Expert)
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21 November 2021 For the first year, a condonation was given for the delay in LUT. In your case, that condonation cannot be availed. You cannot cover your exports in a LUT applied later on.

CA Raj Doshi

CA Raj Doshi (Expert)
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21 November 2021 first year of gst I.E 2017-18... Circular 37/11/2018

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