Question

XYZ imported goods and input tax credit taken on it for IGST charged in the Bill of Entry. These goods were rejected being wrong supply and re-exported to the supplier.
1) Can they claim input tax credit of IGST paid?
2) While re-exporting to the supplier, can they export without payment of GST under LUT even if they had taken input tax credit of the IGST?

Answer

XYZ can claim ITC on purchase of goods. Re-export is an independent supply but we will suggest you to take route of Drawback. You can claim Drawback of the tax paid on import of goods as per section 74 of Customs. This way you can also get refund of Custom duty. (Reply dt.18/12/2018)