Mahaveer International entered into a transaction for import of goods from a vendor located in Germany. Due to financial issues Mahaveer International was not in a situation to clear the goods upon payment of import duty

As per Section 7(2) of the Central Goods and Services Tax Act, 2017 along with Schedule III, high seas sale transaction i.e. supply of goods by the consignee to any other person, by endorsement of documents of title to the goods, after the goods have been dispatched from the port of origin located outside India, but before clearance for home consumption shall not be considered as supply under GST. Thus, the sale of goods by Mahaveer International to Sairam Export House in high seas shall not be liable to GST. Further, the import duty including IGST shall be payable by Sairam Export House at the time of clearance of goods at port of import. In case the goods are sold back by Sairam Export House to Mahaveer International at a subsequent point of time, the same shall be treated as normal domestic sale transaction; and GST shall be applicable on the same subject to other conditions prescribed under GST Law.