We invite your attention to Circular No 3/1/2018-IGST dated
25th May, 2018 (‘Circular) issued
by Ministry of Finance, Department of Revenue, Central Board of Indirect Taxes
and Customs with regards to applicability of Integrated Goods and Services Tax
(IGST) on goods sold while being deposited in a customs bonded warehouse.
Please find attached the circular issued for your ready reference.
· As
per the said circular, it is clarified that IGST shall be levied and collected
at the time of final clearance of the warehoused goods for home consumption
i.e., at the time of filing the ex-bond bill of entry for clearance of the
warehoused goods for home consumption. The value of such IGST
payment shall be the value of goods at the stage of clearance inclusive of any
value addition that occurred at the bonded warehouse.
· In
other words, any sale of goods before their clearance from the warehouse would
not be subject to the levy of IGST.
· This
Circular would be applicable for supply of warehoused goods, while being
deposited in a customs bonded warehouse, on or after the 1st of
April, 2018.
Position before issuance of above referred
clarificatory circular:
· This circular supersedes earlier CBEC Circular No. 46/2017-Customs dated 24th November 2017, which
was with regards to the
applicability of IGST / GST on goods transferred / sold while being deposited
in in customs bonded warehouse. As per the said earlier circular, sale from a
bonded warehouse was subject to potential
dual GST levy. (i) at the stage of bill of entry filing by
purchaser and (ii) on in-bond sale by seller of goods.
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