Important Keyword: Notification 06/2018 IGST, royalty GST exemption India, IGST on license fee import, Rule 10(1)(c) customs valuation, double taxation royalty GST, IGST exemption customs paid royalty, import of service GST royalty,
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Table of Contents
[F. No.354/13/2018 -TRU]
Government of India
Ministry of Finance
(Department of Revenue)
New Delhi, the 25th January, 2018
Notification No. 06/2018 - Integrated Tax (Rate): Seeks to exempt royalty and license fee from Integrated tax to the extent it is paid on the consideration attributable to royalty and license fee included in transaction value under Rule 10(1)(c) of Customs Valuation (Determination of value of imported Goods) Rules, 2007
GST: [TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]
G.S.R (E).- In exercise of the powers conferred by sub-section (1) of section 6 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017), hereinafter referred to as the said Act, the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council,
Hereby exempts the integrated tax leviable under section 5 read with section 7 of the said Act on the supply of services, imported into the territory of India, covered by sub-item (c) of item 5 of Schedule II to the Central Goods and Services Tax Act, 2017 (12 of 2017) as made applicable by section 20 of the said Act, to the extent of the aggregate of the duties of Customs leviable under sub-section (7) of section 3 of the Customs Tariff Act, 1975 (51 of 1975),
on the consideration declared under sub-section (1) of section 14 of the Customs Act, 1962 (52 of 1962) towards royalties and license fees included in the transaction value as specified under clause (c) of sub-rule(1) of rule 10 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 on which the appropriate duties of Customs have been paid.
(Ruchi Bisht)
Under Secretary to the
Government of India
📚 Frequently Asked Questions (FAQs): Notification No. 06/2018 – Integrated Tax (Rate)
Q1: What is Notification No. 06/2018 – Integrated Tax (Rate)?
Answer:
It exempts IGST on royalty/license fees to the extent already included in customs transaction value. 06
Q2: What is Rule 10(1)(c) of Customs Valuation Rules?
Answer:
It requires adding royalty/license fee to transaction value if related to imported goods.
Q3: Does this notification eliminate GST on royalty?
Answer:
No. It prevents double taxation. Exemption only to extent customs IGST already paid.
Q4: If royalty not included in customs value, is GST payable?
Answer:
Yes, under reverse charge as import of service.
Q5: Which section allows exemption?
Answer:
Section 6(1) of IGST Act. 06
Q6: Is this applicable to domestic royalty?
Answer:
No, applies to imported services.
Q7: What documentation required?
Answer:
Bill of Entry, customs valuation sheet, royalty agreement.
Q8: Does this affect ITC?
Answer:
Yes, IGST paid at customs is eligible for ITC.
Q9: Can department demand tax despite customs payment?
Answer:
If royalty not included in assessable value, yes.
Q10: Is partial exemption possible?
Answer:
Yes, exemption limited to amount already taxed at customs.
Q11: What if royalty paid later?
Answer:
Customs may require differential duty payment.
Q12: Does this apply retrospectively?
Answer:
Applicable from 25 January 2018.
Q13: Is IGST under Section 3(7) Customs Tariff Act relevant?
Answer:
Yes, exemption linked to IGST paid under that section. 06
Q14: How to show in GST return?
Answer:
RCM liability only on excess portion, if any.
Q15: Where to get GST expert help?
Answer:
Consult Finodha GST Experts:
https://finodha.in/gst-compliance/
🏁 Conclusion
Notification No. 06/2018 – Integrated Tax (Rate) is a major relief for importers paying royalty or license fees.
Download PDF: Notification No. 06/2018 – Integrated Tax (Rate)
More Information: https://taxinformation.cbic.gov.in/
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