QUESTION

One of my client, who is registered in delhi, import goods from outside of india and meterial received at mundra port, gujarat. After Import, material directly keep at a registered warehouse situated at SEZ at mundra port. Some time my client directly sent material from warehouse (Sijtuated in SEZ) to its customer situated at other state. Wether my client should get registered in GSTN in Gujarat state also as material directly supplying from gujarat instead of delhi? Please also consider that the warehouse is situated in SEZ.

ANSWER

Facts of the case:  A person registered in Delhi import goods from outside India and material received at Mundra port, Gujarat. After Import, material directly keeps at a registered warehouse situated at SEZ at Mundra port. Sometimes the material is directly supplied from warehouse (Situated in SEZ) to customer situated in other state. Whether the person is required to take registration in Gujarat state as material directly supplying from Gujarat instead of Delhi.

Law Applicable:

SCHEDULE III OF CGST ACT
8. (a) Supply of warehoused goods to any person before clearance for home consumption.

Interpretation: Supply of material to DTA by SEZ is considered as import by DTA and for this separate procedure is given under SEZ Act read with relevant rules.

Our reply is based on the assumption that the unit is registered in SEZ.

If the unit is not registered in SEZ and material is simply kept in Custom bonded warehouse then you can do High Sea Sale. It is not subjected to GST at your end as per clause 8(a) of Schedule III, but the buyer will file a Bill of entry and pay tax.

Conclusion:  If the material is supplied from Gujarat then it will be considered as supply by the distinct person and not supply by the Delhi unit.

You are requested to please let us know about the registration status of the unit in Gujarat whether it is keeping material in a customs bonded warehouse or having its own registered warehouse in SEZ.(Reply dt.18.11.2020)