LUT for Exporters Under GST: Form RFD-11 Filing Guide, Eligibility & Timelines

Exporting products, digital services, or software solutions from India opens immense global commercial horizons. To ensure domestic taxes do not make Indian businesses uncompetitive internationally, the Indian indirect tax regime operates on the principle of Zero-Rated Supplies under Section 16 of the Integrated Goods and Services Tax (IGST) Act, 2017.

While exporters have the legal option to pay integrated tax and claim refunds later, paying tax upfront locks up precious working capital. The most efficient statutory mechanism to protect business cash flow is filing a Letter of Undertaking (LUT) on the Goods and Services Tax Common Portal.

Codified under Rule 96A of the Central Goods and Services Tax (CGST) Rules, 2017, an approved LUT in Form GST RFD-11 allows registered taxpayers to export goods or services overseas—as well as supply to Special Economic Zone (SEZ) units—without paying a single rupee of output tax.

This practical guide details eligibility criteria, the step-by-step digital filing process on gst.gov.in, witness protocols, and ongoing invoice compliance.

---

What is a Letter of Undertaking (LUT)?

A Letter of Undertaking is a formal legal commitment executed by an exporter and submitted to the President of India through the jurisdictional Goods and Services Tax department.

In this document, the exporter undertakes:

1. To export the goods or services within the statutory timeframe specified in Rule 96A.
2. To observe all provisions of the GST Acts and Rules in respect of such zero-rated supplies.
3. To pay the full integrated tax along with applicable statutory interest (currently 18% per annum under Section 50) if the export is not completed within the prescribed window.

Once submitted online, the GST portal generates an Application Reference Number (ARN) instantly, serving as electronic authorization for the financial year.

---

Statutory Framework Under Rule 96A of the CGST Rules

Rule 96A establishes the legal rules governing exports without payment of tax:

RULE 96A STATUTORY CONDITIONS & TIMELINES

Category of Export Supply	Statutory Completion Window
1. Export of Physical Goods	Must be exported outside India within 3 MONTHS from invoice date.
2. Export of Services	Payment in convertible foreign exch must be received within 1 YEAR.
Consequence of Failure: Exporter must pay applicable IGST within 15
days of the deadline expiry, plus 18% statutory interest.

---

Eligibility Criteria: Who Can File an LUT vs Who Needs a Bond

Historically, small exporters were forced to submit physical bank guarantees and complex indemnity bonds. To promote ease of doing business, the Central Board of Indirect Taxes and Customs (CBIC) issued Circular No. 8/8/2017-GST:

1. General Eligibility for Online LUT (Form RFD-11)

All registered taxpayers who intend to supply goods or services for export or to SEZ units are eligible to submit an online Letter of Undertaking without furnishing a bank guarantee, provided:

• They hold an active GSTIN.
• They have not been prosecuted for an offence under the CGST Act, IGST Act, or earlier tax laws where the amount of tax evaded exceeds ₹250 Lakhs (₹2.5 Crores) under Section 132.

2. When is a Bond with Bank Guarantee Mandatory?

Only taxpayers who have been convicted in a court of law for tax evasion exceeding ₹2.5 Crores are disqualified from filing an LUT. Such individuals must execute a physical Bond in Form GST RFD-11 on non-judicial stamp paper, accompanied by a bank guarantee of up to 15% of the estimated tax liability.

---

Annual Validity Window & Timing of Submission

An approved LUT does not remain valid indefinitely:

• Validity Period: An LUT is valid for one Financial Year (April 1 to March 31). For example, an LUT filed for FY 2026-27 expires automatically on March 31, 2027.
• Filing Window: Exporters should file Form GST RFD-11 in the month of March preceding the upcoming financial year, or at any time before issuing their first export invoice in that year.
• No Retrospective Relief: While CBIC circulars permit condonation of minor procedural delays, issuing zero-rated export invoices before filing an LUT can trigger demand notices requiring proof of compliance.

---

Step-by-Step Procedure to File Form GST RFD-11

Filing an LUT is an entirely paperless, automated procedure on the GST Common Portal:

1. Log into GST Portal (gst.gov.in)
2. Navigate to: Services > User Services > Furnish Letter of Undertaking (LUT)
3. Select Financial Year (e.g., 2026-2027)
4. Select Undertaking Checkboxes (Self-Declaration)
5. Enter Details of Two Independent Witnesses
6. Select Primary Authorized Signatory & Place
7. Sign and Submit via Class 3 DSC or EVC (Aadhaar OTP)
8. Instant Approval: Download Form GST RFD-11 Acknowledgement with ARN

---

Mandatory Witness Details & Verification Protocols

When completing the webform, the portal requires the particulars of two independent witnesses:

1. Required Information:
   • Full Legal Name
   • Residential Address (Street, City, State, PIN code)
   • Occupation (e.g., “Accountant”, “Consultant”, “Service”)
2. Who Can Be a Witness? Any adult individual with legal capacity—such as senior employees, colleagues, or associates—can serve as a witness.
3. No Digital Signature Required for Witnesses: Witnesses do not need a DSC or OTP. The authorized signatory signs the declaration under their own digital credentials, certifying that the witnesses are real persons.

---

Post-Filing Statutory Obligations: Goods (3 Months) & Services (1 Year)

Securing an approved LUT is only the first step. Exporters must maintain strict audit trails to substantiate that zero-rated transactions complied with statutory time limits:

1. Export of Physical Goods

Under Rule 96A(1)(a), goods must leave Indian territory within three months of the invoice timestamp:

• Proof of Export: Shipping Bill / Bill of Export with export promotion copy, and carrier-issued Export General Manifest (EGM) or Bill of Lading / Airway Bill.
• Default Consequence: If goods remain unshipped after 90 days, the exporter must voluntarily deposit the full IGST amount in the next GSTR-3B with interest, or face recovery proceedings under Section 73/74.

2. Export of Services

Under Rule 96A(1)(b), services must be paid for in convertible foreign exchange within one year from the invoice date:

• Proof of Inward Remittance: Foreign Inward Remittance Certificate (FIRC) or electronic Bank Realisation Certificate (e-BRC) issued by the Authorized Dealer (AD) bank.
• Special Currencies: Receipts in Indian Rupees are valid only where permitted by the Reserve Bank of India (such as designated Vostro accounts or cross-border trade with Nepal/Bhutan).

---

Invoice Endorsement Rules & Common Errors

Every tax invoice issued for zero-rated export supplies under an LUT must strictly comply with Rule 46 of the CGST Rules:

1. Mandatory Legal Text on Export Invoices

All export invoices must prominently state:

“SUPPLY MEANT FOR EXPORT UNDER BOND OR LETTER OF UNDERTAKING WITHOUT PAYMENT OF INTEGRATED TAX”

2. Essential Invoice Fields:

• The 14-digit LUT Application Reference Number (ARN).
• Exporter’s legal name, registered address, and GSTIN.
• Recipient’s full overseas name and delivery address.
• Country of destination and port of loading/discharge (for physical goods).
• 6-digit or 8-digit HSN/SAC code and currency of invoice.

---

Frequently Asked Questions

When should an exporter file Form GST RFD-11 for an upcoming financial year?

Form GST RFD-11 should ideally be filed in March prior to the commencement of the new financial year (e.g., in March 2026 for FY 2026-27), or immediately before making the first export shipment or issuing the first cross-border invoice in that financial year.

What happens if goods exported under an LUT are not physically shipped within 3 months?

Under Rule 96A(1)(a) of the CGST Rules, if goods are not exported within three months from the invoice date, the exporter must pay the applicable integrated tax within 15 days of the expiry of the 3-month window, along with 18% annual interest under Section 50.

Who can act as a witness in Form GST RFD-11?

Form RFD-11 requires details of two independent witnesses, including their full legal name, residential address, and occupation. Witnesses can be colleagues, business partners, employees, or family members; their physical signatures are not uploaded since the form is digitally authenticated via DSC or EVC.

Is an LUT applicable for supplies made to Special Economic Zone (SEZ) units?

Yes. Under Section 16(1)(b) of the IGST Act, supplies made to SEZ developers or SEZ units are zero-rated. Suppliers can furnish Form GST RFD-11 to supply goods or services to SEZ entities without charging integrated tax.

Can a proprietor file Form GST RFD-11 using Aadhaar OTP (EVC)?

Yes. Sole proprietorships, individual professionals, and partnership firms can digitally authenticate Form GST RFD-11 using Electronic Verification Code (EVC) via Aadhaar/PAN OTP. Companies and LLPs must sign using a Class 3 Digital Signature Certificate (DSC).

---

Official References

• Central Goods and Services Tax Rules, 2017 - Rule 96A (Export under LUT/Bond) — Central Board of Indirect Taxes and Customs (CBIC), Government of India
• CBIC Circular No. 8/8/2017-GST - Clarification on Issues Related to Furnishing of Bond/LUT — Department of Revenue, Ministry of Finance
• GST Common Portal - User Guide for Filing Form GST RFD-11 — Goods and Services Tax Network (GSTN)