Receipt of For. Curren. where place of supply is in India

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This query is : Resolved

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This discussion clarifies whether a supplier in Gujarat delivering goods to a buyer outside India, but within Maharashtra, can receive payment in foreign currency. The consensus is that since the goods are delivered within India, it's considered a domestic supply, not an export. Therefore, foreign currency remittance is not permissible, and applicable IGST must be paid.

Darshit Oza

Darshit Oza (Querist)

07 February 2020 If the supplier of Goods (located in Gujarat) on the request of Buyer of Goods (located outside India) provides the delivery of the goods within India (Maharashtra) on payment of applicable IGST at the prevailing rate then whether the Supplier of Goods can receive remittance on such goods in Foreign Currency? And the Supply of Goods shall be considered as deemed export or Inter-State Supply?
As per the Bank instruction the supplier of goods can not accept such remittance in foreign currency by declaring as Export as it shall be considered as Domestic Supply.
Kindly resolve my query as soon as possible.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

07 February 2020 It shall be considered as Domestic Supply and no foreign currency payment can be made. The bank instructions are right.

CA Anita Bhadra

CA Anita Bhadra (Expert)

07 February 2020 Concurred with CA R Seetharaman

Sec.11 of IGST Act will not apply since goods have not left India. It will not be treated as an Export

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