{"id":2552,"date":"2021-02-22T07:19:51","date_gmt":"2021-02-22T07:19:51","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=2552"},"modified":"2021-02-22T07:19:53","modified_gmt":"2021-02-22T07:19:53","slug":"gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/","title":{"rendered":"GST Network Introduces Feature of Letter of Undertaking for FY 2021-22"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The Goods and Service Network has decided to\nintroduce the feature of Letter of Undertaking (LUT) for the financial year\n2021 to 2022 on the GST portal.<\/p>\n\n\n\n<p>Further, the same has been in consonance to Rule 96\nA of the CGST Rules 2017, which was notified by way of Notification Number 16\/\n2017, dated 07.07.2017. Under the said rule, any registered person who has\navailed the option to supply goods or services for the purpose of export, but\nhad not made the payment, needs to furnish a bond or Letter of Undertaking\n(LUT) in form GST RFD 11 with the authorities. The same must be done prior to\nexport.<\/p>\n\n\n\n<p>However, the said feature of Letter of Undertaking\nhas been extended to all the registered persons who intend to supply their\ngoods or services for export but without making payment of integrated tax.<\/p>\n\n\n\n<p>In this blog, we will discuss about the feature of\nLetter of Undertaking, together with the process to furnish the same.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3ab290a29ff\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3ab290a29ff\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/#Concept_of_Letter_of_Undertaking\" title=\"Concept of Letter of Undertaking\">Concept of Letter of Undertaking<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/#Applicability_of_Letter_of_Undertaking\" title=\"Applicability of Letter of Undertaking\">Applicability of Letter of Undertaking<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/#Impact_of_the_Changes_Made_by_Government\" title=\"Impact of the Changes Made by Government\">Impact of the Changes Made by Government<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/#Launch_of_Feature_of_Letter_of_Undertaking\" title=\"Launch of Feature of Letter of Undertaking\">Launch of Feature of Letter of Undertaking<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/#Validity_of_Letter_of_Undertaking\" title=\"Validity of Letter of Undertaking\">Validity of Letter of Undertaking<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/#Process_to_file_Letter_of_Undertaking_on_GST_Portal\" title=\"Process to file Letter of Undertaking on GST Portal\">Process to file Letter of Undertaking on GST Portal<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/swaritadvisors.com\/blog\/gst-network-introduces-feature-of-letter-of-undertaking-for-fy-2021-22\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Concept_of_Letter_of_Undertaking\"><\/span>Concept of Letter of Undertaking<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The term LUT or Letter of Undertaking means a document\nthat an assessee uses to provide aa declaration that all the requirements under\nthe GST are duly complied with. Further, the said document is furnished when\nthe exports are undertaken without paying IGST (Integrated Goods and Service\nTax). <\/p>\n\n\n\n<p>Also, based on the provisions of the Notification No\n37\/ 2017, it is compulsory to submit a Letter of Undertaking for the export of\ngoods and services without paying IGST. However, if in case an exporter fails\nto furnish the LUT, then, in that case, he\/ she needs to either pay IGST or an\nExport Bond. <\/p>\n\n\n\n<p>Moreover, it shall be pertinent to state that earlier, an LUT could only be filed at the respective GST office. However, to ease out the process, the same can now be filed online.<\/p>\n\n\n\n<p><strong>Also, Read:<\/strong> <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/implications-of-union-budget-2021-on-gst-act\/\">Implications of Union Budget 2021 on GST Act<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Applicability_of_Letter_of_Undertaking\"><\/span>Applicability of Letter of Undertaking<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The facility to export under Letter of Undertaking\nhas been extended to all the registered person who wishes to supply goods and\nservices for export without paying the amount levied as Integrated Tax. Further,\nthe term Registered Person means the individual who have obtain <a href=\"https:\/\/swaritadvisors.com\/gst-registration\" class=\"text-primary\"><strong>GST Registration<\/strong><\/a>.<\/p>\n\n\n\n<p>However, it shall be relevant to state that all\nthose who have been prosecuted for any offence under the provisions of the\nCentral Goods and Service Tax or under the Integrated Goods and Service Tax or\nany other existing laws will not be allowed to use the feature of Letter of\nUndertaking.<\/p>\n\n\n\n<p>Also, in the case where the assessee has evaded the\ntax of Rs 50 lakhs or more, then, in that case, he\/ she will not be allowed to\nuse the feature of Letter of Undertaking.<\/p>\n\n\n\n<p>Further, the Central Government, by way of the Union Budget 2021, has proposed that the refund of GST paid on the export of goods and service will be restricted only to the notified taxpayers of Goods and Services.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Impact_of_the_Changes_Made_by_Government\"><\/span>Impact of the Changes Made by Government<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The main impact of the feature of Letter of\nUndertaking is that many businesses, which were earlier claiming rebate on the\ntax payment made for exports, can now resort to exports without making payment\nunder Letter of Undertaking or bond. After that, these entities can claim a\nrefund of unutilised input credits as well.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Launch_of_Feature_of_Letter_of_Undertaking\"><\/span>Launch of Feature of Letter of Undertaking<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The new feature of Letter of Undertaking for the\nfinancial year 2021 to 2022 will be made applicable before 01.04.2021 for doing\nexports of goods and services or both on or after 01.04.2021. <\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Validity_of_Letter_of_Undertaking\"><\/span>Validity of Letter of Undertaking<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The validity for the Letter of Undertaking is till\nnext 31<sup>st<\/sup> March, starting from the date of issuance. Also, the\nprocess for Submission or Renewal of Letter of Undertaking (LUT) is very simple\nand user friendly.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Process_to_file_Letter_of_Undertaking_on_GST_Portal\"><\/span>Process to file Letter of Undertaking on GST Portal<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The\nsteps involved in the process to file a Letter of Undertaking on the GST Portal\nare as follows:<\/p>\n\n\n\n<ul><li>Visit the official GST Portal at <a href=\"https:\/\/www.gst.gov.in\/\">https:\/\/www.gst.gov.in\/<\/a>;<\/li><li>Now, the Homepage of GST will be\ndisplayed;<\/li><li>In the next step, log in to the GST\nportal with the provided credentials;<\/li><li>&nbsp;After\nthat, click on \u201cServices\u201d\n&gt; \u201cUser Services\u201d &gt; Furnish LUT (Letter of Undertaking);<\/li><li>Now, the assesseee needs to choose the\nfinancial year for 2021 \u2013 2022 from the drop down menu of the Letter of\nUndertaking (LUT) Applied for Financial Year;<\/li><li>After that, the assessee needs to select\nthe file button to upload the previous Letter of Undertaking (if in case the\nassessee has not furnished LUT for the previous period, then, in that case, he\/\nshe needs to attach the same and continue to file his\/ her application);<\/li><li>It shall be pertinent to state that only\nJPEG or PDF formats are allowed, and the file size for upload should not exceed\n2 MB;<\/li><li>Now, read carefully and tick the\ncheckboxes for the declaration to accept the conditions and stipulations\nspecified in the Letter of Undertaking;<\/li><li>In the next step, the assessee needs to\nfill in the details of the two witnesses as required by LUT. The term details\ninclude Name and Addresses of the witnesses;<\/li><li>After that, select the authorised\nsignatory;<\/li><li>Now, click the preview button for form\npreview;<\/li><li>Choose the \u201cSave\u201d button to save the application form to retrieve\nit later;<\/li><li>Now, in this step, the assessee requires\nto sign the form with DSC or with the EVC option;<\/li><li>Once the LUT is accepted by GSTN, an\nApplication Reference Number (ARN) as an acknowledgement for the same will be displayed\non the screen. The assessee need to record the same for future reference;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In a nutshell, a Letter of Undertaking denotes a document that an assessee uses to declare that the requirements of GST are duly complied with. Further, by way of the Budget 2021, the government has declared that the facility to export under the feature of Letter of Undertaking has been extended to all the registered person who wants to export without paying the Integrated Tax. Also, a Letter of Undertaking remains valid till the next 31<sup>st<\/sup> March, starting from the date of issuance.<\/p>\n\n\n\n<p><strong>Also, Read:<\/strong> <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/extension-of-sanction-for-pending-igst-refunds-by-cbic\/\">Extension of Sanction for Pending IGST Refunds by CBIC<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Goods and Service Network has decided to introduce the feature of Letter of Undertaking (LUT) for the financial year 2021 to 2022 on the GST portal. Further, the same has been in consonance to Rule 96 A of the CGST Rules 2017, which was notified by way of Notification Number 16\/ 2017, dated 07.07.2017. 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