No GST on supply of goods from a spot in a non- taxable area to somewhere else in non- taxable region: AAR

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Fact of the Case 

  • The applicant company was engaged in the business of manufacturing goods like pumps designed for handling water, single and multi-stage pumps designed for handling water, single and multi-stage pumps, dairy machines etc.  
  • The applicant’s parent company (M/s. SPX Flow Technology, Poland) located in Poland was engaged in shipping goods such as spare parts of dairy machinery to the recipient customer company located in Bangladesh.  
  • It filed a request for an advance ruling to determine whether it would be liable to pay IGST on out and out transactions beyond the Customs borders of India. It also argued that the deal would involve generating a single bill by the parent company to the applicant and the production of another bill by the applicant on the recipient company which would be based in Bangladesh. However, the goods will be delivered directly from Poland to the customer on CIF. 


  • The Authority for Advance Ruling observed that supply of goods from a place in the non-taxable territory to another place in the non-taxable territory India shall be treated either as a supply of goods or a supply of services with effect from 1-2-2019.  
  • Since in the instant case, goods are supplied from Poland (which is a non-taxable territory) directly to Bangladesh (which is also a non-taxable territory) without the said goods entering India, the transactions mentioned in the instant case would be like that as mentioned in Entry No. 7 of Schedule-III of the CGST Act, 2017. Consequently, it was observed that no IGST would be paid for such transactions effected from 1-2-2019 onwards by the applicant.