ENA Sectors 2018-12-26 11:27:34 <p><strong>New Delhi, Dec 26 (KNN) </strong>After the Authority for Advanced Ruling (AAR) ruling on duty-free shops, the Madhya Pradesh High Court has also ruled out GST exemption on such supplies at airport by Indian manufacturers.</p> <p>With this, trader supplying goods to duty-free shops at the airport cant be exempted from paying the GST as the supply isnt a form of export, the court order said.</p> <p>It said The petitioner is selling to a person, who is having duty-free shop (to a duty-free operator), which is located in India as per the definition clause as contained under the GST Act.</p> <p>The petitioner who wanted to supply goods to duty-free shops situated in the duty-free area at international airports was aggrieved by the fact that the benefit available to him under the erstwhile central excise regime (when goods supplied to such shops were exempt from the excise duty) was not available to him under the goods and services tax (GST) regime.</p> <p>Clarifying on this, the court order said Undisputedly, in light of the definition as contained under the IGST Act, 2017 a duty free shop situated at the airport cannot be treated as territory out of India. The petitioner is not exporting the goods out of India. He is selling to a supplier, who is within India and the point of sale is also at Indore as the petitioner is receiving price of goods at Indore.</p> <p>Earlier this year, the AAR in Delhi had ruled that a retailer at the Delhis international airport will have to pay applicable GST on sales.</p> <p>AAR in its ruling said The said outlet is not outside India&hellip; but the same is within the territory of India as defined under section 2(56) of the CGST Act,2017 and section 2(27) of the Customs Act, 1962, and hence the applicant is not taking goods out of India and hence their supply cannot be called export under Section 2(5) of the IGST Act, 2017, or zero rated supply under Section 2(23) and Section 16(1) of the IGST Act,2017.</p> <p>According to section 2(5) of the IGST Act, export of goods takes place only when goods are taken out to a place outside India. India is defined under Section 2(27) of the Customs Act as India includes the territorial waters of India .</p> <p>Under Section 2(56) of the CGST Act, India means the territory of India including its territorial waters and the air space above its territory and territorial waters.</p> 21644 https://knnindia.co.in/news/newsdetails/sectors/supply-to-duty-free-shops-at-airport-not-free-from-gst-duties-mp-hc 2018-12-26 11:27:34 knnindia.co.in