Implementation of Section 16(4) related to restriction on export
Implementation of Section 16(4) of IGST Act related to restriction on export of certain goods on payment of IGST and coverage under refund mechanism- Circular No. 24 /2023-Customs
Reference is invited to sub section (4) of section 16 of IGST act 2017 and Notification No. 01/2023-Integrated Tax dated 31.08.2023 (copy enclosed).
2. Vide Notification No. 27/2023-Central Tax dated 31.07.2023, Section 16(4)of IGST Act, 2017 will be effective from 01.10.2023. Further, in terms of above provision, vide Notification no. 01/2023-Integrated Tax dated 31.08.2023, it has been notified that all goods or services (except the goods specified in column (3) of the TABLE in Notification) may be exported on payment of integrated tax on which the supplier of such goods or services may claim the refund of tax so paid. In effect, Goods mentioned in the Table annexed to the above notification may be exported only under LUT.
4.1 To implement above restrictions imposed on export of goods or services on payment of IGST, DG Systems CBIC has developed a backend functionality to restrict IGST refund route for the goods as specified in the above notification. Through the said functionality, changes have been made in the system of filing of shipping bills and during amendment, with respect to the commodities mentioned in the said notification. Since IGST refund is paid at shipping bills level, the checks have been enabled at shipping bill level.
4.2 It may be noted that, in cases where a shipping bill contains single or multiple invoices for which IGST have been paid and even if one invoice contains an item which is restricted for export on payment of IGST under section 16(4) of the IGST Act, the shipping bill containing such items will not be allowed to be filed.
5. In view of the above, it is requested that the concerned officers under your jurisdiction may be sensitized, especially for manual Shipping Bills in Non-EDI ports or even at EDI ports, or for export through posts/courier, to not allow export of such notified goods on payment of IGST so as to ensure that no undue benefits are taken by exporting such notified goods in accordance with the provisions of section 16(4) of the IGST act 2017.
6. It is also requested that suitable trade notices/ public notices may be issued in this regard to sensitise the trade for the same.
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