Welcome to the SD-CIN-Deemed Export page.
This scenario deals with Deemed Export or CT-1/CT-3 or SEZ sales that refer to sale of goods to customers within India, who are generally holders of an export license. The materials sold are required to be used in the production of goods meant for ultimate export. The customers can be an export-oriented unit (EOU) or located in one of the following areas:
For this Deemed Export sale:
An inquiry can be the first step in the order cycle. The purpose of this activity is to create an inquiry to represent the customer’s inquiry in the system.
Then a quotation can be created to determine material, their quantities, prices and payment terms that are valid for a given sold-to customer during a specified time period. As prerequisites, it can be referred from an existing inquiry and terms of payment need to be in place.
Then in system we need to capture the Customer’s License Details. This done for
As prerequisites, a copy of the license obtained by the customer from issued by relevant authorities.
Then a Sales Order is created to represent the customer’s requirement in the system. That will calculate the price and check for the availability of materials. As prerequisites, it can be referred from an existing quotation and should mention material that are mentioned in customer licence details.
Then with reference to the created sales order, a Pro Forma Invoice can be created in order to inform the customer about the value of the goods, so that he will make arrangements for the payment to be made, when goods arrive at his place.
With reference to the created sales order, the delivery document is created for shipping point mention in sales order to pick the goods and post goods issue based on availability of the ordered material.
With reference to post goods issue delivery material, a billing document is created to send a commercial invoice to the customer. It also updates the corresponding GL Accounts. Further its output can be taken.
With post goods issue completed for the delivery and respective billing document generated, the Excise Invoice created for the excise authorities. And subsequently print for accompanying materials that are being sent to the csurtomers.
ARE-3/ARE-1document is created with reference to generated outgoing Excise Invoice. This is assigned to a License captured for the customer. This document is a proof that, goods are treated as Deemed exports and Excise duty does not need to be paid for these goods, which are mentioned in the ARE-3/ARE-1.
After the responsible official confirms that all the details are correct, we can post the ARE-3/ARE-1 document. The changes are allowed to the ARE-3/ARE-1 document only if, it is in the process pending posting. Once posted, the ARE-3/ARE-1 cannot be changed but can only be cancelled.
Going further, we can print the ARE-3/ARE-1 documents for submitting to the customer and the excise authorities. After ARE-3/ARE-1 Document is created and posted and also when the goods arrive at the Customer’s premises, they will check them against the excise invoice and the ARE-3/ARE-1. If there are any discrepancies in the quantity of the goods, the customer will record the actual quantity received on the ARE-3/ARE-1.To record the customer’s confirmation of the quantity delivered, we update the ARE-3/ARE-1 document.Finally, when the countersigned ARE document arrives back at your premises from the customer, the ARE-3/ARE-1 is further updated with the date of receipt. This closes the ARE-3/ARE-1.
Also refer SDN wiki link on ARE1: CIN Creation - Updation - Post - Cancel for process flow with transaction code in ARE1.
System Configuration Considerations
1 Defining Sales Document Type for deemed export
2 Creating Pro Forma Invoice for deemed export
3 Creating Billing Type for deemed export.
4 Assigning Billing Types to Delivery Types
5 Maintaining Item Categories
6 Copying Control for
a. Sales Document to Sales Document (Inquiry – Quotation, Quotation – Deemed Export Sal Doc Type)
b. Sales Document to Billing Document (Deemed Export Sal Doc Type – Pro Forma Invoice)
c. Sales Order type to Delivery Type (Deemed Export Sal Doc Type – Delivery Doc)
d. Delivery type to Billing Type (Delivery Doc – Billing Doc)
7 Configuring Pricing
a. Pricing procedure for pricing
b. New customer pricing procedure (Cust.pric.proc. is maintained at customer master) need to be maintain for deemed export for differentiating from export pricing while pricing determination.
8 Account determination
9 Maintaining Number Range for Excise Bonding License for object J_1ILIC
10 Creating a new Series Group (maintain new series group
a. Maintaining Number Range for Local Excise Invoice for object J_1IEXCLOC
b. Making Settings for ARE-3/ARE-1 Procedure
c. Maintaining Number Range for ARE-3/ARE-1 for object J_1IARE3/J_1IARE1
d. Defining Processing Modes per Transaction, this will make ARE-3/ARE-1 options active in the ARE-3/ARE-1 screen
e. Defining Reference Documents per Transaction
11 Maintaining an output types for ARE-3/ARE-1 Sales which will be based on plant.
12 The following Master Data will attract attention,
a. Maintaining Customer Master, particularly, Cust.pric.proc. in pricing section of Sales Tab in Sales data.
b. Customer CIN details (J1ID)
c. Maintaining Material Master
d. Material CIN details (J1ID)
e. Maintaining relevant conditions records for:
Development activity to be consideration
Following output type & program we may need to maintain/modified as per requirement:
Following are few of the License Types:
So, when CT1 is one of the license types, for that you need to create ARE3 use TCode J_1IARE3. Then you need to capture license by using TCode J1ILIC01.
Further, if your scenario is of exporting under bond, then you might need to create ARE1 use TCode J_1IARE1 and also create bond by using TCode J1IBN01.
Useful OSS Notes