Last reviewed: 13 November 2026. Deemed exports are supplies that never leave India but are treated as exports for policy reasons, typically supplies against an Advance Authorisation, to an EPCG holder or to an Export Oriented Unit. Unlike real exports they are not zero-rated: the supplier charges GST, and either the recipient or the supplier then claims it back. The paperwork decides who claims, and the two parties must agree on it before the invoice is raised.
Part of our GST refund series. For every refund category, the common process, time limits and interest, start with the complete GST refund guide.
The notified deemed exports
| Supply | Recipient |
|---|---|
| Supply of goods by a registered person against an Advance Authorisation | Holder of the Advance Authorisation |
| Supply of capital goods against an EPCG authorisation | Holder of the EPCG authorisation |
| Supply of goods to an Export Oriented Unit (EOU, EHTP, STP or BTP unit) | The unit |
| Supply of gold by a bank or public sector undertaking against an Advance Authorisation | Holder of the authorisation |
These are notified under Notification 48/2017-Central Tax. Only goods qualify, and only where they are manufactured in India. Supplies at the concessional 0.1% rate to merchant exporters under Notification 40/2017-Central Tax (Rate) are a different scheme and are not deemed exports.
Who claims the refund
| Point | Recipient claims | Supplier claims |
|---|---|---|
| When used | Default route; recipient paid the tax to the supplier | Where the parties agree the supplier will claim |
| Recipient's input tax credit | Not availed on these supplies | Not availed on these supplies |
| Undertaking needed | From the supplier, that it will not claim the refund | From the recipient, that it has not taken credit and will not claim the refund |
| RFD-01 category | Refund on account of deemed exports (recipient) | Refund on account of deemed exports (supplier) |
The recipient can instead simply take input tax credit of the tax charged and use it, if that suits its position. What it cannot do is take credit and also allow a refund to be claimed. Circular 147/03/2021-GST clarified that the recipient's refund is a refund of tax paid on the supply, not a refund of unutilised credit, so the section 54(3) restrictions on refunding credit do not apply to it.
Documents
- Tax invoices for the deemed export supplies, reported in GSTR-1 as deemed exports.
- Acknowledgement by the jurisdictional tax officer of the Advance Authorisation or EPCG holder, or by the EOU, that the goods were received.
- Copy of the Advance Authorisation or EPCG authorisation, or the unit's approval.
- Undertaking from the other party, as described above.
- Statement of invoices for the claim and proof that the tax has been paid.
Relevant date and time limit
Section 54, Explanation 2(b), sets the relevant date as the date on which the return relating to the deemed exports is furnished. Circular 147/03/2021-GST explains that, where the recipient claims, this is the date on which the supplier files the return covering those supplies. The claim must be filed within two years of that date.
Worked example
A Bhiwandi supplier sells components of ₹50,00,000 plus 18% GST of ₹9,00,000 to an Advance Authorisation holder in Pune. The recipient pays the full ₹59,00,000, does not take credit, and obtains the supplier's undertaking. After the supplier files GSTR-1 and GSTR-3B for the month, the recipient files RFD-01 for ₹9,00,000 with the officer's acknowledgement of receipt. Deemed exports are not zero-rated supplies, so the 90% provisional refund under section 54(6) is not available; the claim moves to a final order within 60 days of a complete application.
Practical points
- Decide the claimant in the purchase order, and attach the undertaking format to it.
- The recipient's working capital is blocked between payment and refund; build that into the price or payment terms.
- Report the supply correctly in GSTR-1; a supply shown as ordinary B2B will not support a deemed export refund.
For real exports and SEZ supplies, see the GST refund guide and refunds on supplies to SEZ.
Frequently asked questions
What are deemed exports under GST?
Supplies notified under section 147 by Notification 48/2017-Central Tax: goods supplied against an Advance Authorisation, capital goods against an EPCG authorisation, goods supplied to an EOU or similar unit, and gold supplied by a bank or PSU against an Advance Authorisation. The goods do not leave India.
Is GST charged on deemed exports?
Yes. Deemed exports are not zero-rated, so the supplier charges GST. The recipient or the supplier then claims a refund of that tax.
Who can claim the refund on deemed exports?
Either the recipient or the supplier, but not both. The recipient claims with an undertaking from the supplier that it will not claim; the supplier claims with an undertaking from the recipient that it has not availed credit and will not claim.
Is a 90% provisional refund available for deemed exports?
No. Provisional refund under section 54(6) is for zero-rated supplies and, from 1 November 2026, inverted duty claims. Deemed exports are decided by a final order within 60 days of a complete application.
Are supplies to merchant exporters at 0.1% deemed exports?
No. Supplies at 0.1% under Notification 40/2017-Central Tax (Rate) are a separate concession for goods procured for export by merchant exporters. The refund routes for those exports are the export refund routes.
We review eligibility, build the computation and reconciliations from your books and returns, file the RFD-01, and handle deficiency memos, show cause notices and appeals until the claim is closed. The outcome rests with the proper officer; our work is to put a complete, defensible claim in front of them.
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This article is for general information and does not constitute advice on any specific case. Sources: sections 54 to 56 and 77 of the CGST Act, 2017; rules 89 to 97 of the CGST Rules, 2017 as amended by Notification No. 05/2026-Central Tax dated 26 October 2026; Notification No. 03/2026-Central Tax; CBIC circulars cited in the text. Rules, forms and portal functionality change; confirm the current position on the CBIC tax repository and the GST portal before filing. Firm details: Somesh Chandak & Associates, Chartered Accountants, Unit 119, 1st Floor, Centura Square IT Park, SG Barve Road, Wagle Estate, Thane West 400604. FRN 158694W.