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DGFT clarifies the issues pertaining to applicability of pre-import condition under Advance Authorization
This Tax Alert summarizes a recent Trade Notice [1] issued by Directorate General of Foreign Trade (DGFT) pertaining to fulfilment of pre-import condition under Advance Authorizations (AA) issued during the period between 13 October 2017 to 9 January 2019.
Earlier the Supreme Court (SC) vide its judgement held that pre-import condition would prevail for availing exemption of integrated tax (IGST) and compensation cess on goods imported against AA.
Consequently, a Circular and a Trade Notice were issued by Central Board of Indirect taxes and Customs (CBIC) and DGFT respectively, wherein it was clarified that IGST, and compensation cess was payable in respect of imports made against AA during the period between 13 October 2017 to 9 January 2019, in cases where the pre-import condition was not met.
[1] Trade Notice No. 27/2023 dated 25 September 2023