On September 15, 2025, a new order was issued providing clarifications on several procedural aspects concerning Special Economic Zones (SEZs). The order addresses the need for SEZ units to include certain details on invoices, specifically the Letter of Undertaking (LUT) number and financial year. It clarifies that while Rule 46 of the Central Goods and Services Tax (CGST) Rules does not require these details on every invoice, SEZ units must still provide copies of LUTs from their Domestic Tariff Area (DTA) suppliers annually for verification purposes.
Additionally, the order specifies that Authorised Officers (AOs) should not demand GST return copies from DTA suppliers before endorsing invoices, as there is no legal requirement for such documentation. This aims to simplify the endorsement process for SEZ units.
Regarding the 45-day proof of payment rule under Rule 30(4) of SEZ Rules, the order clarifies that this time limit is applicable only to goods. For services, endorsements can be made even beyond the 45-day period, extending up to a maximum of six months from the date of supply. This extension provides more flexibility in handling service transactions within SEZs.
Finally, the order instructs Authorised Officers to adhere strictly to these clarifications and report any operational challenges they encounter. This directive aims to ensure smooth compliance and operational efficiency within SEZs.
Order date: 15 Sept 2025
Key Clarifications
1. LUT details on invoices – LUT number and financial year need not be mentioned on every invoice, since Rule 46 of the CGST Rules does not mandate it. Instead, SEZ units must furnish copies of LUTs obtained from their DTA suppliers annually for verification.
2. GST return copies – AOs should not insist on production of GST returns of DTA suppliers before endorsing invoices, as this requirement has no statutory backing.
3. 45-day proof of payment limit – The 45-day time limit under Rule 30(4) of SEZ Rules applies only to goods. In the case of services, endorsements may be allowed even beyond 45 days, subject to a maximum period of six months from the date of supply.
4. Compliance directive – Authorised Officers are instructed to strictly follow these clarifications, and to report any further operational difficulties.
