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Rules being framed for GST refunding to tourists in India

The Integrated GST law provides for refund of GST on goods which are to be taken out of the country by tourists.

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Question: When NRIs and foreign tourists visit India and purchase goods which they take with them when they leave the country, no refund is granted for the GST paid in India. In other countries, the VAT or GST is refunded at the airport to a foreign tourist when he leaves that country. Is anything being done for refunding GST on goods purchased by foreigners and NRIs in India?

India is currently putting in place an appropriate system for refunding GST to foreign tourists who buy goods in India. For this purpose, the GST network architecture will have to be suitably changed and the invoicing system will need to be updated. Rules are being framed to operationalise the scheme for refunding the GST paid in India. In fact, the Integrated GST law provides for refund of GST on goods which are to be taken out of the country by tourists. This is in line with the legal provisions prevailing in other countries where products above a threshold are eligible for refund of taxes which are to be claimed at the airport from where the tourist departs and payment is received by such person directly in the bank account in the country in which he resides. A pilot project is being introduced to operationalise the scheme. However, this will take time to implement in view of the complexity of the issues involved.

The provisions of the money laundering law in India are being harshly used by the authorities. Several arrests have been made. Is this punitive action justified and constitutionally valid?

Several petitions have been filed in the Supreme Court of India challenging the provisions of the Prevention of Money Laundering Act and the strict enforcement of this law by the Enforcement Directorate. The Supreme Court has, last month, given its final verdict on this issue and held that the provisions of the law are constitutionally valid and cannot be read down or diluted in any way. The law passed in India has been in conformity with several international treaties and conventions which have been entered into by India with other countries of the world. The apex Court in its elaborate judgment has held that none of the provisions of PMLA are illegal. It particularly approved and upheld the provisions of section 5 of the Act which permit the passing of orders for provisional attachment of property which has been the subject matter of money laundering. The Court held that registration of an offence or filing of a complaint is not a pre-condition for attachment of assets. The Court upheld the powers of the officers of the Enforcement Directorate to arrest a person involved in the commission of an offence of money laundering. According to the Court, this was necessary to tackle emerging situations created by human proclivity to amass wealth which was prejudicial to the financial system of the country.

My children are studying in India. Is there any possibility of the Indian school leaving certificates and grade sheets being acceptable in foreign countries for students who wish to pursue higher education there?

At present, some foreign universities at their discretion accept Indian qualifications when they grant admission. Fortunately, India and the United Kingdom have recently entered into bilateral agreements whereby there will be mutual recognition of educational qualifications of students from both countries. Under the agreement, courses at the undergraduate and post graduate levels will be covered. However, this agreement excludes professional degrees in engineering, medicine, pharmacy and architecture. The memorandum of understanding which India and Britain have entered into will include online courses and facilitate courses which offer students the option to study partly in India and partly in the UK. On a reciprocal basis, Indian Senior Secondary School certificates will be considered suitable for admission to UK higher educational institutions. Further, the Bachelor’s degree, Master’s degree, and doctoral degree of India and the UK will be considered equivalent to each other.

H. P. Ranina is a practicing lawyer, specialising in tax and exchange management laws of India. Views expressed are his own and do not reflect the newspaper’s policy

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