EOU Deemed Export Refund 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.
When a registered supplier sells goods to an Export Oriented Unit (EOU), GST is charged at the normal rate, but the supply is a notified deemed export, and the tax can be refunded. The refund can go to the EOU (the recipient) or to the supplier, never to both. Choosing the right side, and keeping the paperwork that goes with it, decides whether the claim moves smoothly.
Notification 48/2017-CT (under s.147) treats supply of goods to an EOU as a deemed export. The second proviso to Rule 89(1) lets the recipient file the refund, or the supplier where the recipient does not avail ITC and gives an undertaking that the supplier may claim. A recipient claims by availing the tax as ITC and debiting its credit ledger for the refund (Circular 147/03/2021-GST); that ITC is not subject to s.17 (Circular 172/04/2022-GST). The relevant date is the date the supplier files the return for the supply, whoever claims (Circular 166/22/2021-GST). The procurement procedure in Circular 14/14/2017-GST must be followed.
What counts as a deemed export
Section 147 lets the government notify supplies of goods manufactured in India that do not leave India as deemed exports. The ICAI Handbook on Refunds lists the four notified in Notification 48/2017-CT:
| Deemed export supply | Recipient |
|---|---|
| Goods supplied against an Advance Authorisation | AA holder |
| Capital goods supplied against an EPCG Authorisation | EPCG holder |
| Goods supplied to an Export Oriented Unit | EOU (the Handbook applies the same procedure to EHTP, STP and BTP units) |
| Gold supplied by a notified bank or PSU against an Advance Authorisation | AA holder |
Deemed exports are not zero-rated supplies. There is no LUT here: the supplier charges and pays GST in the normal way, and the refund recovers it afterwards. If you are weighing the claim, our deemed exports refund service handles both the recipient and the supplier side.
The EOU procurement procedure (Circular 14/14/2017-GST)
The Handbook reproduces the procedure and safeguards for supplies to EOU, EHTP, STP and BTP units:
- Prior intimation in Form-A. The unit gives an intimation with a running serial number, listing the goods to be procured (as pre-approved by the Development Commissioner) and the supplier's details, to the supplier, the supplier's jurisdictional GST officer and its own jurisdictional GST officer.
- Tax invoice. The supplier supplies the goods under a tax invoice.
- Endorsement. On receipt, the unit endorses the tax invoice and sends copies to the supplier and to both jurisdictional officers. The endorsed invoice is the proof of the deemed export supply.
- Digital records in Form-B. The unit maintains records of deemed export supplies in digital form, with an audit trail, and provides the month's Form-B data to its jurisdictional officer by the 10th of each month.
A claim without the Form-A intimation and endorsed invoice is weak from the start, whichever side files it.
Recipient claims or supplier claims: the comparison
| Point | EOU (recipient) claims | Supplier claims |
|---|---|---|
| Legal basis | Rule 89(1) second proviso, clause (a) | Rule 89(1) second proviso, clause (b) |
| ITC by the EOU | EOU avails the tax as ITC, then debits it on filing | EOU must not avail ITC |
| Undertaking | EOU: refund only for invoices in Statement 5B, not above ITC availed; supplier has not claimed | EOU: no ITC availed and it will not claim refund; supplier may claim |
| Documents | As per Circular 14/14/2017-GST | Notification 49/2017-CT documents plus Circular 14/14/2017-GST |
| Relevant date | Date of supplier's return for the supply | Same |
| Cash position | EOU pays the GST and recovers it | Supplier recovers tax it paid; EOU usually pays a tax-exclusive price |
The recipient route is the common choice where the EOU paid the GST and has the paperwork. The supplier route suits a supplier who agreed to sell at a tax-exclusive price, provided the EOU confirms it has not taken ITC. The detailed document lists for both are in deemed export refund documents and statement.
How the recipient's claim works on the portal
The Handbook explains that, to prevent a double benefit, the portal allows refund to recipients only of ITC, which the claimant must debit when filing (Circular 147/03/2021-GST). So the EOU:
- avails the GST charged on the endorsed invoices as ITC in GSTR-3B;
- files RFD-01 under the deemed exports category with Statement 5B; and
- debits its electronic credit ledger for the amount claimed.
Circular 172/04/2022-GST then clarifies that this ITC, made available only to enable the refund, is not ITC under Chapter V and so is not subject to s.17. Restrictions like apportionment or blocked credits do not cut it down.
Worked illustration
A DTA supplier sells raw material worth ₹40,00,000 to an EOU at 18% GST, ₹7,20,000 (illustration). The EOU has the Form-A intimation and endorsed invoices.
| Step | Amount |
|---|---|
| GST paid by EOU to supplier | ₹7,20,000 |
| Supplier reports in GSTR-1 Table 6C and pays tax in its GSTR-3B | ₹7,20,000 |
| EOU avails ITC | ₹7,20,000 |
| EOU files RFD-01 with Statement 5B, debits credit ledger | ₹7,20,000 |
| Refund to EOU on sanction | ₹7,20,000 |
The two-year limit runs from the date the supplier filed the return covering these invoices. Check the rate for your goods in the current schedule; the figures are illustrative only.
Pitfalls
- Both sides claim. The officer checks the other party's undertaking. A double claim leads to rejection and recovery.
- EOU avails ITC but the supplier claims. The supplier route needs the recipient's undertaking that no ITC was availed; availing it defeats the supplier's claim.
- Timing. The relevant date is the supplier's return date, not the EOU's. An EOU waiting to accumulate claims can lose older invoices.
- Unjust enrichment papers. The Handbook's Annexure lists the Rule 89(2)(l) self-declaration or 89(2)(m) CA certificate for both supplier and recipient claims.
Rules 89(4A)/(4B), which dealt with suppliers to AA and EOU holders, were omitted prospectively by Notification 20/2024-CT dated 08.10.2024. For their history and the position on earlier periods, see Rule 89(4A)/(4B): Advance Authorisation and EOU suppliers.
Need help with an EOU or deemed export claim?
We can check the Form-A and endorsement trail, agree with your counterparty which side should claim, and file the RFD-01 with the right undertakings. See our deemed export refund support, or the wider GST refund service.
Key takeaways
- Supplies of goods to an EOU are deemed exports under Notification 48/2017-CT; GST is paid and then refunded.
- Either the EOU or the supplier claims, never both.
- A recipient claims by availing the tax as ITC and debiting the credit ledger; s.17 does not apply to it.
- The relevant date is the date of the supplier's return for the supply.
- Follow Circular 14/14/2017-GST: Form-A intimation, endorsed invoice, Form-B records.
Read next
- Deemed export refund: who claims and the undertakings
- How to claim a GST refund on deemed exports
- EOU: Export Oriented Unit scheme and benefits
- GST refund under EPCG scheme
Disclaimer: Positions stated as on 30 September 2026, based on the CGST Act and Rules as amended, the Finance Act 2026, and the ICAI Handbook on Refunds under GST (January 2026). Verify current notifications before filing.