High Sea Sales [HSS] is a common trade practice within four corners of law whereby the original importer of goods sells the subject goods to a third person before the goods are entered for customs clearance.
How is high sea sales treated?
The final buyer must have all important documents evidencing high sea sales. They are the original import invoice, the high sea sales agreement, the invoice from the original Importer (Original Buyer) along with Bill of Lading, Bill of Entry and Certificate of Origin etc. (vi) Insurance Certificate.
What is the difference between high sea sales and merchanting trade?
Also as per, RBI Guidelines “For a trade to be classified as merchanting trade, goods acquired shall not enter the Domestic Tariff Area.” This is the stark difference between High Sea Sales and Merchant trade transaction. While the former must be followed by ultimate import, the later must not include import.
Can high sea sales be predetermined?
SICOI: SICOI (Sales in course of imports) is a predetermined sale, which means the customer is already available for the goods being imported. HSS: HSS (High sea sales) is a sale where you have to find the customer when the goods are still at the high seas or before the goods reach the country.
Is GST applicable for high sea sales?
As there is no supply, GST cannot be charged on such sales, and hence there is no question of ITC relating to such transaction. In simple words, the tax has not been charged while purchasing HSS goods and therefore the tax will not be levied in HSS sales.
How do you audit a high sea sale?
Reconcile high sea sales recorded in books of accounts with that of GST Returns; As Bill of Entry has to be filed by the original buyer, ensure whether the documents such as Bill of Lading, Commercial Invoice, Insurance Copies etc are provided to the ultimate buyer by the original importer.
Is e way bill required for high sea sales?
E-way bill is required for movement of goods within the country. In case of High Sea Sales as the supply is affected before the goods cross the custom frontiers of India, E-way bill is not required to be generated.
What is meant by high seas?
High seas, in maritime law, all parts of the mass of saltwater surrounding the globe that are not part of the territorial sea or internal waters of a state. For several centuries beginning in the European Middle Ages, a number of maritime states asserted sovereignty over large portions of the high seas.
Is e invoice required for high sea sales?
Whether for high sea sales and bonded warehouse sales e -invoicing is applicable? No. These activities/transactions are neither supply of goods nor a supply of services, as per Schedule III of CGST/SGST Act. e-invoicing is not applicable for import Bills of Entry.
What is high sea sales with example?
For example, if a buyer in India purchases iron scrap from USA and while the shipment is in transit, the goods are sold to another person, the transaction would be termed as high sea sales.
What do you mean by high sea sales?
High Sea sales (HSS) is a sale carried out by the actual consignee (ie, the consignee shown in the Bill of Lading) to another buyer while the goods are yet on high seas or after their dispatch from the port of loading (POL) and before their arrival at the port of discharge (POD).
Can a goods be sold more than once on high seas?
Same goods can be sold more than once on high seas. In such cases, HSS agreement should give indication of previous title transfers. The last HSS buyer should also obtain copies of previous HSS agreement as such documents may be called upon by the customs. HSS is considered as a sale carried out outside the territorial jurisdiction of India.
When does high sea sale agreement need to be dated?
Means, the high sea sale agreement must be dated before arrival of goods at a territorial border of an importing country. What is Territorial Border of a country? I have written a detailed article in this web blog about on this subject about ‘meaning of imports and exports’, ‘territorial border’ etc.
What do you need for high sea sale?
So, the import invoice issued by first seller to first buyer is needed as one of the requirements of documents under High Sea Sale. Kindly note, this import invoice must be endorsed by high sea seller in favor of high sea buyer. Import Packing List is another document required for import customs clearance under High Sea Sale.
