Deemed Exports: FTP Para 7.02 Against Notification No. 48/2017

Deemed Exports explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.

There are two deemed export lists in Indian law, and they do not match. The FTP's list is long and project-oriented; the GST list has four entries. A supply on the first list but not the second gets drawback and terminal excise duty relief, but no GST refund — and that mismatch is the single commonest error in this area.

Under the FTP, "'Deemed Exports' refer to those transactions in which goods supplied do not leave country, and payment for such supplies is received either in Indian rupees or in free foreign exchange", provided the goods are manufactured in India. Under GST, "'deemed exports'… would encompass solely the supplies notified under Section 147 of the CGST/SGST Act" — and Notification No. 48/2017-Central Tax dated 18 October 2017 notifies only four categories.

The four key characteristics

• No Physical Export — "not physically shipped out of India";
• Domestic Supply — "the transaction is conducted entirely within India";
• Tax Benefits — "eligible for specific tax advantages, including the possibility of refunds of taxes paid";
• Payment in INR or Foreign Exchange — either is acceptable.

Export against deemed export, in the Handbook's own table:

The FTP list

(A) Supply by a manufacturer:

• (a) Supply of goods against Advance Authorization, Annual Requirement Authorization, or DFIA;
• (b) Supply of goods to EOU, STP, EHTP, or BTP;
• (c) Supply of capital goods against EPCG Authorization.

(B) Supply by main or sub-contractor(s):

• (a) Supply to projects financed by multilateral or bilateral Agencies/Funds notified by the Department of Economic Affairs, where "legal agreements provide for tender evaluation without including customs duty"; and supply and installation under single-responsibility turnkey contracts to such projects where "bids have been invited and evaluated on the basis of Delivered Duty Paid (DDP) prices for goods manufactured abroad." Such supplies "shall be under International Competitive Bidding (ICB)", with agencies listed in Appendix 7A;
• (b) Supply of goods to any project for which the Ministry of Finance permits import at zero basic customs duty under Customs Notification No. 50/2017-Customs dated 30.06.2017 — "Benefits… shall be available only if the supply is made under procedure of ICB." For mega power projects at Sl. No. 598, List 31 meeting the threshold generation capacity, "ICB condition would not be mandatory if the requisite quantum of power has been tied up through tariff based competitive bidding";
• (c) Supply to the United Nations or an International organization for official use or to projects they finance, approved under section 3 of the United Nations (Privileges and Immunities) Act, 1947 — Customs Notification No. 84/97-Customs, agencies in Appendix 7B;
• (d) Supply to nuclear power projects at Sl. No. 602, List 32 of Notification No. 50/2017-Customs, with capacity of 440 MW or more, a certificate "issued by an officer not below the rank of Joint Secretary to Government of India, in Department of Atomic Energy", and tender through NCB or ICB.

Note how much of the (B) list turns on the bidding procedure. ICB is generally a precondition, because the benefit exists to put domestic suppliers on equal footing with duty-free imports in an international tender.

The GST list: four entries

Notification No. 48/2017-Central Tax dated 18 October 2017, under section 147:

1. Supply of goods by a registered person against advance authorization.
2. Supply of capital goods by a registered person against export promotion capital goods authorization.
3. Supply of goods by a registered person to an export-oriented unit.
4. Supply of gold by a bank or PSU specified in Notification No. 50/2017-Customs against advance authorization.

The gap is the whole of limb (B). Multilateral and bilateral funded projects, UN supplies, mega power projects and nuclear power projects are FTP deemed exports but not GST deemed exports. A supplier to a 500 MW nuclear project may claim deemed export drawback under the FTP and cannot claim a GST refund under section 147.

And note that entry 3 covers EOUs but the FTP limb (A)(b) also covers STP, EHTP and BTP — a second, narrower mismatch.

Why deemed exports are not zero-rated

"Deemed exports are not zero-rated supplies by default, unlike the regular exports. Hence all supplies notified as supply for deemed export will be subject to levy of taxes i.e. such supplies can be made on payment of tax and cannot be supplied under a Bond/LUT. However, the refund of tax paid on the supply regarded as Deemed export is admissible to either the supplier or the recipient."

Three consequences follow.

Tax must be charged. There is no LUT route. The Handbook confirms this for EPCG: "Supply of goods against EPCG authorization is deemed export but not exempted upfront and hence supply against EPCG is liable to GST."

Either party may claim. Rule 89 of the CGST Rules, as amended by Notification No. 47/2017-Central Tax dated 18.10.2017, "allows either the recipient or supplier of such supplies to claim refund of tax paid thereon."

Only one of them may. Where the recipient claims, they must "provide a declaration that the supplier has neither claimed nor shall claim any refund with respect to the said supplies."

And services are excluded entirely. "No, Deemed Export benefits are applicable only to goods."

Claiming, on both sides

GST refund. Application in FORM GST RFD-01 through the common portal, "before the expiry of two years from the date on which the return relating to such deemed export supplies is to be furnished electronically."

Note the relevant date. Two years runs from the due date of the return, not from the date of supply or the date of payment.

A recipient's claim uploads "the documents required to be filed along with Form RFD-01A" and "Statement 5B with the details of invoices", with the ground selected as "recipient of deemed exports." Up to four documents of 5 MB each may be uploaded. On filing, an ARN is generated and the application is assigned to a Refund Processing Officer.

FTP benefits. Under ANF-7A, deemed exports are eligible for:

• (a) Advance Authorization / AA for Annual Requirement / DFIA;
• (b) Deemed Export Drawback;
• (c) Refund of Terminal Excise Duty for excisable goods in Schedule 4 of the Central Excise Act, 1944, "provided the supply is eligible under that category of deemed exports and there is no exemption."

Where to file. "Supplier / recipient of goods shall submit application… in ANF-7A… to the concerned Regional Authority." But "In case of supply of goods to an EOU, claim shall be filed with the concerned Development Commissioner. A domestic tariff area (DTA) Unit shall claim benefits from the concerned Regional Authority."

Documentation includes "a copy of the invoice; acknowledgment from the recipient (project authority, EOU, etc.); proof of the transaction being treated as a Deemed Export (such as agreement documents); copies of relevant GST returns; end-use certifications (where applicable)."

And an IEC is mandatory even though nothing crosses a border.

Key takeaways

• FTP deemed exports cover manufacturer supplies against AA/DFIA/EPCG and to EOU/STP/EHTP/BTP, plus contractor supplies to multilateral-funded, UN, mega power and nuclear projects — mostly under ICB.
• GST deemed exports are only the four categories in Notification No. 48/2017-CT under section 147.
• The lists do not match: project supplies are FTP deemed exports but not GST deemed exports.
• Deemed exports are not zero-rated — tax must be charged, and no LUT or bond may be used.
• Refund under rule 89 may be claimed by either supplier or recipient, but not both; a recipient must declare the supplier will not claim.
• Services are excluded from deemed export benefits entirely.
• RFD-01 within two years from the due date of the return for the relevant supplies; recipients file Statement 5B.
• FTP benefits under ANF-7A: AA/DFIA, deemed export drawback, and terminal excise duty refund; EOU supplies go to the Development Commissioner.
• An IEC is mandatory for deemed exports.

Read next

• EPCG Scheme: Six Times Duty Saved, and the Average Export Obligation
• EOU Scheme: Net Foreign Exchange and DTA Sale
• Advance Authorisation: Inputs, SION and Minimum Value Addition

Disclaimer: Positions stated as on 5 September 2026, based on Chapter 7 of the Foreign Trade Policy 2023, Appendices 7A and 7B, Form ANF-7A, section 147 of the CGST Act, 2017, rule 89 of the CGST Rules, 2017, Notification Nos. 47/2017 and 48/2017-Central Tax dated 18 October 2017, Customs Notifications No. 50/2017 and 84/97-Customs, and the United Nations (Privileges and Immunities) Act, 1947, as reproduced in the ICAI Handbook on Foreign Trade Policy – Incentives, Schemes & Related FAQs (November 2025, 2nd Edition).