The Duty Exemption Scheme enables duty free import of
inputs required for export production. Under the scheme government can issue
an Advance Authorization or DFIA to import inputs the duty free. In addition
DEPB is issued post-export as a script mentioning the duty amount that can
be utilized for further imports.
Input - Output norms (SION)
The government has published the standard input-output
norms (SION) for more than 6000 products. These are available in the
Handbook of Procedures (Vol-II) of Exim Policy. While applying for advance
Authorization the input-output norms are to be followed for duty free
inputs. If however no norms are available, Authorization can still be
applied on self- declaration basis.
Advance Authorisation
An Advance Authorization is issued to allow duty free import of
inputs, which are physically incorporated in the export product
(making normal allowance for wastage) subject to actual user
condition. Such Authorizations are exempted from payment of basic
customs duty, additional customs duty, anti dumping duty and
safeguard duty, if any.
Advance Authorization can also be issued for supplies with in
India that are categorized as Deemed Exports. Purposes like supplies
to Power Projects, Projects funded by WB/ADB/JBIC etc, EOUs etc.
Advance Authorizations are issued with an obligation to export
the quantity and value of goods mentioned therein in a fixed period
of 24 months. Before imports customs ask for a bond or a bank
guarantee towards security for duty saved, till export obligation is
fulfilled.
Advance Authorizations or materials imported against it can-not
be transferred even after completion of Export Obligation.
Advance Authorisations are also available for Annual
requirement under SION as well as on SELF-DECLARATION basis.
Duty Free Import Authorisation (DFIA)
DFIA is issued to a merchant-exporter or manufacturer-exporter
for duty free import of inputs used in the manufacture of goods
without payment of basic customs duty, additional customs
duty/excise duty, antidumping duty and safeguard duty if any. DFIA
is issued on minimum value addition of 20%, and only for export of
products covered under the SION. DFIA and or the material(s)
imported against it are freely transferable after completion of
Export Obligation.
DFIA can also be issued for supplies with in India that are
categorized as Deemed Exports. Purposes like supplies to Power
Projects, Projects funded by WB/ADB/JBIC etc, EOUs etc.
DFIA can also be issued for supplies with in India that are
categorized as Deemed Exports. Purposes like supplies to Power
Projects, Projects funded by WB/ADB/JBIC etc, EOUs etc.
Duty Entitlement Passbook Scheme
The objective of DEPB is to neutralize the incidence of
Customs duty deemed to have been suffered on the import content of the
export product. The neutralization is provided by way of grant of duty
credit against the export product. The duty credit is given as a specified
percentage of FOB value of exports, made in freely convertible currency.
This duty credit can be utilized for import of any goods/capital goods
which are not prohibited.
The DEPB and/or the items imported against it are freely transferable.
Indigenous Sourcing
The holder of advance Authorization and DFIA may also source
their inputs from indigenous sources. In such cases, the excise duty
payable by the indigenous supplier can be exempted. In addition the
indigenous supplier can import his own raw material duty free or can
even get a drawback.
What
We Do
We can assist you in assessing the feasibility of the
scheme for your exports/domestic supplies, planning for maximum benefits,
documentation, application preparations, representation and coordination
with DGFT and other concerned Government Departments till you finally get
the Authorisation.
In case of domestic procurement we can assist in getting necessary
invalidations from the authority, for duty free import of second stage raw
materials and the Drawbacks wherever applicable.
Later we will assist you in getting the ratification of the norms from the
Norms Committee. Finally we can assist you in redemptions of the
Authorization.
We also undertake the jobs of Norms Fixation, DEPB rate fixation,
Clarifications from the committee etc.
