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Which of the following is a zero-rated supply under Section 16(1) of the IGST Act, 2017?

Question and options

Which of the following is a zero-rated supply under Section 16(1) of the IGST Act, 2017?

  1. A supply of goods to an export-oriented unit

  2. A supply of goods to a merchant exporter at a concessional rate

  3. A supply of goods by an SEZ unit to a buyer in the domestic tariff area

  4. A supply of goods to an SEZ unit for its authorised operations

Answer and explanation

Correct answer: D - A supply of goods to an SEZ unit for its authorised operations

Section 16(1) of the IGST Act, 2017 zero-rates exports of goods or services and supplies to a Special Economic Zone developer or unit for authorised operations. Supplies to an export-oriented unit and to a merchant exporter are deemed exports notified under section 147 of the CGST Act, 2017, not zero-rated supplies, and a clearance from an SEZ into the domestic tariff area is treated as an import.

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