Exports Filed Appeal in Many High Courts Over GST Notices from DRI

The exporters have dragged revenue intelligence (DRI) that is India’s main anti-smuggling intelligence firm to several courts concerning notices upon carrying dreadful claims of GST privileges.

It might be a temporary advantage for the assessee said, Tax experts. Exporters had received notices from DRI for dreadful claiming of Goods and Services Tax privileges in which the exports before imports.

“The objective of providing the working capital benefits to the Indian exporters gets defeated by the rule which goes beyond the statute. Applicability of interest would result in a great setback to the Indian exporters and the need for judicial intervention is must” said Abhishek A Rastogi, partner at Khaitan & Co.

IGST was asked to pay through the exporters as the foreign trade scheme has been changed and various notifications were given in the last months. 18% is the average IGST rate whereas for some of the products it is 5% to 12%. In the prior tax regime along with the foreign trade scheme, the industry trackers said that there is no tax if imported raw materials were used for the exports despite the exports earlier imports.

The present GST platform has implemented some guidelines to claim the advantages for the exporters. The revenue department gives a declaration in which the raw materials will not be imported post export of the final product. A change is conducted through the government for the GST platform so that DRI can challenge the exporters.

The change implemented in the main criteria of a “pre-import condition” where every exporter required to claim the tax privileges on imports “In cases where exports preceded imports, availment of exemption does not seem legal and proper. This office has initiated an inquiry in wrongful availment of exemption,”

“After DRI notices, the matter has been raised afresh in several courts that have issued notices or granted stay on proceedings. The retrospective amendment is also a subject matter of challenge”, said Rastogi while debating various applicants for the exporters.