Effective from October 1, 2023, Section 16(4) of the IGST Act allows only a class of goods and services to be exported with payment of IGST, in order to claim refund of such tax paid. All other goods which are sin goods (hereinafter referred as ‘restricted goods’) must be exported under a Letter of Undertaking (LUT).
To enforce these restrictions, CBIC’s DG Systems have updated the shipping bill filing system.
Customs authorities have advised exporters not to file shipping bills for export with payment of IGST if any item within the bill belongs to the category of restricted goods, under Section 16(4) of the IGST Act. This would ensure compliance with the law and prevent undue claims with respect of restricted goods. In case the shipping bill contains even one item from the restricted goods category, such shipping bill would not be allowed to be filled.