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Stock transfer outside india - accounting and legal queries!

Aarushi (Manager-Accounts & Finance) (52 Points)

13 June 2018

Hi ,

I need to understand accounting and legal challanges in transfering stock to our warehouse taken on rent outside the country .

Let me explain it clearly here ...

So we are planning to take warehouse on monthly rent in USA to keep our stock for sale there, we will be salling to companies there so will get remittance in very 15 days now my queries are

1. Whether we need to show it as stock transfer in our books in India or direct export sale under GST ?

2. What is the timeline to get payment against stock exported outside the country for the purpose of sale and what we need to do if some stock remain unsold ?

We have LUT bond to export goods at zero rated value. Requesting all experts to advice on my queries to resolve my confusion on this sale arrangements .

Regards

Aarushi

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7 Replies

Sumit Jaicky (13 Points)
Replied 13 June 2018

First there is no need to show export sale, as it is kept in Warehouse. It will be shown as stock in foreign warehouse.
Second the month on which stock sold are to be received in Indian rupees within six months. The good unsold are closing stock kept at warehouse.

R. B. Yadav (CMA, LLB) (Tax Consultant) (590 Points)
Replied 13 June 2018

Hi,
There is no provision of stock transfer under GST act. It will be treated as supply of goods and it will be reported in return as an export of goods.

No time limit to get the payment in case of export of goods to fulfill the condition of export of goods under gst.

as you already have LUT, no need to charge igst.

Aarushi (Manager-Accounts & Finance) (52 Points)
Replied 15 June 2018

Ok . Also have one confusion , how to send goods outside countrywithout invoice ? is there any procedure ?

Aarushi (Manager-Accounts & Finance) (52 Points)
Replied 15 June 2018

Ok , so should I treat this as export sale ? Also ,is thereany time limit to get payment against these goods transfered to other country?

CS M Pota (Company Secreatary) (3180 Points)
Replied 31 August 2019

In GST there not thought of Stock Transfer.Whatever you will send out of India will be treated as Export and you will have to follow export procedures lice preparation of pre export documentation and file the with customs and get the goods customs cleared.So far as concerned to receipt of payment of export as per FEMA the payment should be received in 9 months from the date of export.