No Export of Taxes
WE must all always remember that it is the avowed policy of the Government of India that taxes should not be exported - you should export goods and services. Every investigator and every adjudicator should remember that this is the ultimate goal and if any export goods suffer any taxes, they should be refunded to the exporter. If this policy is understood, a lot of litigation can be avoided.
Only yesterday in the Rajya Sabha, the Minister of Commerce & Industry, Nirmala Sitharaman, in a written reply stated:
One of the guiding principles of FTP is that the taxes should not be exported. Therefore, exporters are granted access to duty free raw material or are provided refund of duties paid in manufacture of exported products .
The policy also provides framework for duty free import of raw materials and duty free import of capital goods for enhancing manufacturing capacity for exports, after fixing export obligation on the exporters .