Law Legends


What Is Deemed Export

Deemed Export :

According to Section 2(39) of the CGST Act, 2017 deemed exports means such supplies of goods as may be notified under section 147 of the Act.

As per section 147 of the CGST Act, 2017 the Government may, on the recommendations of the Council, notify certain supplies of goods as deemed exports, where goods supplied do not leave India, and payment for such supplies is received either in Indian rupees or in convertible foreign exchange, if such goods are manufactured in India.

Explanation of above Sections :-
  1. Applicable only for supply of Goods (not for services): Deemed exports specifically pertain to the supply of goods, and this provision does not apply to services.
  2. Goods are not required to be taken outside India: Unlike regular exports where goods must physically leave the country, in the case of deemed exports, the goods supplied do not need to be taken outside India.
  3. Goods must be manufactured in India: To qualify as deemed exports, the goods must be manufactured in India.
  4. Payment may be received in Indian Rupee or in convertible foreign exchange: The payment for such deemed export supplies can be received either in Indian Rupees or in convertible foreign exchange.
  5. Such supply must be notified by the Government as deemed Export: The government has the authority to notify certain supplies of goods as deemed exports. This means that not all supplies of goods will automatically qualify as deemed exports; they need to be specifically notified by the government.
Following categories of supply has been notified as Deemed Export vide Notification No. 48/2017-Central Tax dated 18th October, 2017 :
S. No. Description of supply
1 Supply of goods by a registered person against Advance Authorisation
2 Supply of capital goods by a registered person against Export Promotion Capital Goods Authorisation
3 Supply of goods by a registered person to Export Oriented Unit
4 Supply of gold by a bank or Public Sector Undertaking specified in the notification No. 50/2017-Customs, dated the 30th June, 2017 (as amended) against Advance Authorisation.
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