Government of India

Ministry of Commerce and Industry

Department of Commerce
Directorate General of Foreign Trade

HANDBOOK OF
PROCEDURES
2023
Handbook of Procedures
2023
(w.e.f 1st April, 2023)

Government of India
Ministry of Commerce and Industry
Department of Commerce
Directorate General of Foreign Trade

pg. 1
CONTENTS

01 Legal Framework and Trade Facilitation

02 General Provisions Regarding Imports and Exports

03 Developing Districts as Export Hubs

04 Duty Exemption / Remission Schemes

05 Export Promotion Capital Goods (EPCG) Scheme

Export Oriented Units (EOUs), Electronics Hardware

06 Technology Parks (EHTPs), Software Technology Parks

(STPs) and Bio-Technology Parks (BTPs)

07 Deemed Exports

08 Quality Complaints and Trade Disputes

09 Promoting Cross Border Trade in Digital Economy

10 SCOMET: Special Chemicals, Organisms, Materials,

Equipment and Technologies

11 Miscellaneous Matters
CHAPTER 1

Legal Framework and

Trade Facilitation
 Chapter-1
Legal Framework and Trade
Facilitation
1.01 Notification of Procedure
In pursuance of the provisions of paragraph 1.03 of Foreign Trade Policy (FTP), the
Director General of Foreign Trade (DGFT) hereby notifies the procedure to be
followed by an exporter or importer or by the licensing/Regional Authority or by any
other authority for purpose of implementing the provisions of Foreign Trade
(Development & Regulation) Act, the Rules/Orders made there under and the
provisions of Foreign Trade Policy. The said procedure is contained in following
compilations:
(a) Hand Book of Procedures
(b) Appendices & Aayat Niryat Forms and
(c) Standard Input Output Norms (SION)
These compilations, as amended from time to time, shall come into force from the date
of the notification and shall continue to be in operation unless otherwise specified or
amended.

1.02 Objective
The objective is to implement provisions of FT (D&R) Act, Rules and Orders made
thereunder and provisions of FTP by laying down simple, transparent and digitally
(electronically) compatible procedures, which are user friendly and easy to comply
with and administer for efficient management of Foreign Trade.

1.03 Definition
For the purpose of this Handbook, definitions and glossary contained in FT (D&R) Act,
Rules and Orders made there under and in the FTP shall apply.

1.04 E-governance of Foreign Trade in DGFT

IT initiatives taken by DGFT are as under:

pg. 4
(a) DGFT Online Customer Portal
A customised online dashboard is made available to the exporter which provides a
360-degree view of Export related applications at https://dgft.gov.in/CP.

(b) Exporter Importer Profile

An Importer / Exporter shall regularly update the Importer Exporter profile on the
online IEC module to enable efficient delivery of services to the IEC holder. The
documents & details available in the IEC Profile and online Repository will facilitate
paperless processing in DGFT.

(c) Facility of online filing and processing of applications

Through the DGFT Customer Portal, applicants can apply online for various trade
related benefits/services including for issue of authorisations/scrips and
amendments thereof under various FTP provisions. The online environment also
enables uploading of supplementary documents, replying to the queries online and
tracking status of applications as well as processing of application by officials.

(d) Automated processing in online environment

Rule-based, system-driven workflow is being implemented in a phased manner for
automated processing of various applications with a risk based management
approach.

(e) Applications requiring Inter-Ministerial Consultation

Exporters would be able to apply and track status of the applications made against
various categories including

(i) Import of Restricted Items

(ii) Export of Restricted Items
(iii) SCOMET Items
(iv) Fixation of norms by Norms Committees

The requisite consultation for these applications with other Ministries/Stakeholders

will also be handled in online environment.

(f) Onboarding of CA/CS/Cost Accountant

In order to move towards paperless processing, an electronic procedure has been
developed to upload digitally signed documents by Chartered Accountant / Company

pg. 5
Secretary / Cost Accountant. Exporter shall be able to link digitally uploaded annexure
with the online applications under various schemes of the FTP.

(g) 24 X 7 Helpdesk Facility to guide applicants and monitor grievances

A dedicated 24 X 7 Helpdesk facility has been put in place to assist the exporters in
filing online applications on the DGFT portal and other matters pertaining to Foreign
Trade Policy.

A Help manual & FAQs for filing various applications under the FTP are also available
on DGFT website under the link https://dgft.gov.in> Learn > Application Help & FAQs.

For assistance any of the following channels may be accessed —

(i) Raise a service request ticket on DGFT website under the link > Services >
DGFT Helpdesk Service
(ii) Call the DGFT toll free helpline number at 1800-572-1550 / 1800-111-550
(iii) Send an email to the Helpdesk on [email protected]

(h) Message Exchange with Community partners

CBIC, CBDT, MCA and Banks are major community partners of DGFT for message
exchange. An effective message exchange system is in place with various community
partners which is as follows:

(i) API Message Exchange with CBIC for

(a) Importer Exporter Code Number

(b) Authorisations/ Scrips including of DFIA, AA, EPCG

(b) Shipping Bills and Bills of Entry

(d) RBI's EDPMS for Export Realisation details

(ii) API Message Exchange with CBDT for PAN related services

(iii) API Message Exchange with MCA for company related information

(iv) Message Exchange with Banks, PFMS & Bharat Kosh

(a) Application Fee

(b) electronic Bank Realisation Certificate (e-BRC) data

(v) API message exchange with M/o MSME for Udyam Registration.

pg. 6
(i) DGFT Trade facilitation Mobile application
A DGFT Trade Facilitation Mobile App is available for information on Trade Statistics,
FTP Schemes and status of applications submitted for both Android and iOS.

(j) Facility to verify the documents/certificate issued through DGFT Portal

Digitally issued e-authorisations/e-certificates through DGFT Portal can be verified at
DGFT website under the link > Services > Verify Document.

1.05 Use of Digital Signature Certificates and Aadhar e-Sign

DGFT allows submission of applications authenticated through digital signature
certificate (DSC) issued by any approved entity of Controller of Certifying Authority of
India or through Aadhar eSign in online environment.

1.06 Conversion of Currencies in e-BRCs

(a) Currencies, where Exchange rates are notified by CBIC: The foreign exchange
realised (as mentioned by bank in the eBRC) is converted into Indian Rupee (INR)
using the monthly exchange rates published by CBIC as on Let Export Order (LEO)
date.
(b) Currencies, where Exchange rates are not notified by CBIC: In such cases, total
realised value in INR (as mentioned by bank in the eBRC), will be converted into US$
by using the US$ /INR exchange rate prevailing on the date of realisation as published
by CBIC.

1.07 Generation of eBRC where payments are realised through Insurance

Agencies
(a) An applicant realising export proceeds through Insurance Agency will approach
the concerned RA with the proof of payment issued by the concerned Insurance
Agency. RA, after satisfying itself of the bona fide of the payment, will obtain approval
of EG&TF Division, DGFT Hqrs and then RA will upload the value (in lieu of eBRC
value) in EDI system of DGFT for processing of the case.
(b) If the proof of payment issued by the Insurance Agency mentions claim value both
in foreign exchange and INR, RA will use the foreign exchange value for processing. If
the claim value is mentioned only in equivalent INR, RA will convert this INR value in
equivalent US$ using the exchange rate (published by CBIC) applicable on the date of
settlement of insurance claim.

pg. 7
 STATUS HOLDER CERTIFICATION

1.08 Status Holder: Application for grant of Status Certificate

(a) Exporters shall be required to file an application online for
recognition of status under the Policy in ANF 1B along with prescribed documents.
(b) Online Application for status certificate shall be filed with jurisdictional RA as
determined by the location of Registered Office in the case of Company and of Head
Office in the case of others as per Appendix 1A.

1.09 Validity of status certificate

(a) Any Status Certificate issued under FTP 2015-20 to an IEC holder shall remain
valid only till 30.09.2023.
(b) Status Certificates issued under this FTP shall be valid for a period of 5 years
from the date on which application for recognition was filed.
(c) On achieving higher status threshold as per Para 1.26 of FTP a firm can, at its
discretion, upgrade their status holder category after surrender of the previous
Certificate and applying as per para 1.08 above.

1.10 Maintenance of Accounts and Submission of Annual Export Statement

Status Holders shall maintain true and proper accounts of its exports and imports
based on which such recognition has been granted. Records shall be maintained for a
period of two years from the date of grant of status certificate. These accounts shall be
made available for inspection to RA concerned or any Authority authorized by DGFT,
as and when required.

1.11 Refusal /Suspension /Cancellation of Certificate

Status Certificate may be refused / suspended/ cancelled by RA concerned, if status
holder or authorized representative acting on his behalf:

(a) Fails to discharge export obligation imposed;

(b) Tampers with Authorisations;
(c) Misrepresents or has been a party to any corrupt or fraudulent practice in
obtaining any Authorisation;
(d) Commits a breach of FT (D& R) Act, or Rules, Orders made there under and FTP,
The Customs Act 1962, The Central Excise Act 1944, FEMA Act 1999, COFEPOSA Act
1974 and Central / State GST Acts ;
(e) Fails to furnish information required by this Directorate.

pg. 8
A reasonable opportunity shall be given to Status Holder before taking any action
under this paragraph.

1.12 Appeal
An applicant, who is not satisfied with decision taken to suspend or cancel Status
Certificate, may file an appeal to DGFT within 45 days. Decision of DGFT shall be final
and binding thereon.

pg. 9
CHAPTER 2

General Provisions
Regarding Imports
and Exports
 CHAPTER-2
GENERAL PROVISIONS REGARDING IMPORTS
AND EXPORTS

2.00 Policy
Policy relating to general provisions regarding exports and imports is given in Chapter-2 of
the FTP.

2.01 Coverage
This chapter covers procedure for various applications including their complete
documentation. Procedure for applications for authorisations/ license/ permissions/
certificates for import/export and applications for benefits under FTP are laid out.

2.02 Countries of Imports/Exports

Unless otherwise specifically provided, international trade (i.e. import into India and/or
export from India) can take place from/to any country. Country specific
prohibitions/limitations, if any, are specified in the FTP or the ITC(HS).

APPLICATIONS

2.03 Filing of Application

(a) Applications seeking authorisation for import/export of “restricted” goods, or for
claiming benefits under the schemes in FTP or for seeking clarifications or for other
purposes may be made online on https://dgft.gov.in
(b) Applicants may ensure while submitting documents that documents are either in
English or Hindi. Documents in regional languages may be translated into English or Hindi
and the translated copy may be self-certified and submitted along with the original copy.

2.04 Territorial Jurisdiction of RA

Territorial jurisdiction of RAs is given in Appendix 1A of Appendices and Aayat Niryat
Forms. The address of applicant determines the jurisdiction of RA. Each application, unless
otherwise specified, shall be submitted to jurisdictional RA.

pg. 11
2.05 Incomplete Application

(a) An incomplete or unauthorised application is liable to be rejected by the competent

authority with specific reason for rejection. Such incomplete application may be re-
opened on rectifying the deficiencies.
(b) If the deficiencies are not rectified by the applicant within a period of 90 days, the
application will be deemed to have been withdrawn.

2.06 Application Fee

The scale of fee, mode of payment, procedure for refund of fee and categories of persons
exempted from payment of fee are provided in Appendix-2K.

IMPORTER EXPORTER CODE (IEC)

2.07 IEC Number Exempted Categories

(a) IEC is compulsory for import and /or exports. However, the following categories of importers or
exporters are exempted from obtaining IEC:

Sl. Categories Exempted from obtaining IEC

No.
(i) Importers covered by clause 3(1) [except sub- clauses (e) and (l)] and exporters
covered by clause 3(2) [except sub-clauses (i) and (k)] of Foreign Trade (Exemption
from application of Rules in certain cases) Order, 1993.
(ii) Ministries /Departments of Central or State Government
(iii) Persons importing or exporting goods for personal use not connected with trade or
manufacture or agriculture.
(iv) Persons importing/exporting goods from/to Nepal; Bhutan; Myanmar (through
Indo-Myanmar border areas); and China (through Gunji, Namgaya Shipkila and
Nathula ports), provided that the CIF value of single consignment of import/export
of goods from/to Nepal; Bhutan and Myanmar (through Indo-Myanmar border
areas) does not exceed Indian Rs. 25,000/-; and in the case of China, (a) for
import/export of goods through Gunji and Namgaya Shipkila, CIF value of single
consignment does not exceed Indian Rs.1,00,000/-; and (b) for import/export of
goods through Nathula, CIF value of single consignment does not exceed
Rs.2,00,000/-.

pg. 12
Further, exemption from obtaining IEC shall not be applicable for export of SCOMET
items as listed in Appendix -3, Schedule 2 of ITC (HS), 2022 except in case of exports by
category (ii) above.
b) Following permanent IEC numbers shall be used by non – commercial PSUs and
categories or importers / exporters mentioned against them for import / export purposes:
Sr. Permanent Categories of Importer / Exporter
No. IEC
1 AMDCG0111E All Ministries / Departments of Central Government and agencies
wholly or partially owned by them.
2 ADSGA0129E All Departments of any State Government and agencies wholly or
partially owned by them.
3 DCUNO0137E Diplomatic personnel, Counsellor officers in India and officials of
UNO and its specialised agencies.
4 IABBR0145E Indians returning from / going abroad and claiming benefit under
Baggage Rules.
5 IIHIE0153E Persons /Institutions /Hospitals importing or
exporting goods for personal use, not connected with trade or
manufacture or agriculture.
6 IIEGN0161E Persons importing/exporting goods from /to Nepal for non-
commercial purposes
7 IIEGM0170E Persons importing / exporting goods from / to Myanmar through
Indo-Myanmar border areas for non-commercial purposes
8 ATAEF1096E Importers importing goods for display or use in fairs/ exhibitions
or similar events under provisions of ATA carnet. This IEC number
can also be used by importers importing for exhibitions/fairs as
per Paragraph 2.60 of Handbook of Procedures
9 IDNBG1100E Director, National Blood Group

10 ICIRN1126E Individuals /Charitable Institution /Registered NGOs importing

goods, which have been exempted from Customs duty under
Notification issued by Ministry of Finance for bonafide use by
victims affected by natural calamity.
11 IIEGC1134E Persons importing/exporting permissible goods as notified from
time to time, from /to China through Gunji, Namgaya Shipkila and
Nathula ports, subject to value ceilings of single consignment as
given in Paragraph 2.07 (iv) above.
12 NCIEE1169E Non-commercial imports and exports by entities who have been
authorised by Reserve Bank of India.

pg. 13
2.08 Application for IEC
a) Exporters/ Importers shall file online application in ANF-2A format through the
online process at https://dgft.gov.in with applicable fee and requisite documents.
b) IEC will be auto-generated and applicant will be informed through e-mail and SMS.
Applicant can also view and download the e-IEC after completion of the submission
process of application by logging onto their dashboard.
c) The applicant is required to submit online application with the following
details/documents (scanned copies to be uploaded) along with the IEC application;

(i) Cancelled cheque bearing entity’s pre-printed name or Bank certificate in

format prescribed;
(ii) Address proof of the applicant entity as detailed in the application

(d) RAs would conduct post-verification of online IECs as per the guidelines.

2.09 IEC Format

An electronic copy of the IEC may be downloaded online on their DGFT Dashboard.
The details of any IEC may be verified on the DGFT Website under Services  ‘View
IEC Related Details’

2.10 Validity of IEC

a) An IEC allotted to an applicant shall have permanent validity unless
suspended/cancelled by the competent authority. The IEC will cover all branches /
divisions / units / factories of the applicant.
b) IEC’s can however be de-activated in pursuance of the policy in para 2.05(e) of FTP.

2.11 Validity of IEC for EOUs / SEZs

An IEC will remain valid irrespective of a firm’s status as a DTA unit or an SEZ unit or
an EOU/EHTP/STP/BTP unit.

2.12 One PAN-One IEC

Only one IEC shall be issued against a single PAN.

2.13 Surrender of IEC

If an IEC holder does not wish to operate allotted IEC, they may surrender the same
online to the issuing authority. On receipt, the issuing authority shall examine the
request. On approval the updated IEC shall be transmitted to the Customs authorities.
pg. 14
IEC can be surrendered only if all authorisations/ obligations have been closed for the
IEC or in cases where the firm has been amalgamated/acquired/merged etc. with
another entity such that all the authorisations/obligations are transferred to the IEC
of the new entity.

2.14 Modification of IEC

(a) Modification(s)/Updation(s) in IEC can be done online only with applicable fees
and requisite documents.
(b) Any change in constitution of firm, address, bank details or any other primary
details, the IEC holder is required to ensure that the IEC details are suitably updated
online within 30 days of effecting such change(s).
(c) Request for (i) Cancellation of existing IEC and (ii) PAN change in existing numeric
IECs has to be made to the jurisdictional Regional Authority.
(d) RAs shall consider applications seeking modification in IEC (all numeric),
involving change in PAN, by ensuring that liabilities of the previous
applicant/applicant firm are transferred to the new applicant/applicant firm whose
PAN will be reflecting in the modified IEC.
(e) In case of change in constitution of a PAN based IEC by way of merger, acquisition,
liquidation, inheritance, business transfer etc. such that PAN of the new entity so
formed is different from the earlier one, an IEC shall be availed against the new PAN
within 30 days of effecting such change, if not existing already. Previous IEC (s) can
also be operationally linked to the IEC of the new entity.
(f) An application for transfer of unredeemed Authorisation(s) from earlier IEC to the
new IEC may be submitted online to the original jurisdictional RA along with
supporting documents. Concerned RA may sanction the given linkage after due
scrutiny of the evidence provided by the applicant including submission of affidavits
etc.

2.15 Profile of Importer / Exporter

a) ANF-1 contains the profile of the importer/exporter. IEC Holder shall be
responsible for updating the same as and when a change takes place immediately or
in any case at least once in a year.

b) Documents which are uploaded in the Importer-Exporter Profile are not required
to be filed each time the importer/exporter applies for authorisation/scrip/ licence/
registration under different schemes of this FTP.

c) Proof of status as manufacturer exporter is also to be uploaded under the Profile.

pg. 15
ISSUANCE OF AUTHORISATION

2.16 Validity period of Authorisation/ Licence / Certificate /

Authorisation / Permissions
Validity period of Import / Export Authorisations from the date of issue shall be as
follows, unless specified otherwise:

Sr. Type of Authorisation Validity Period

No
(i) Export Authorisation for restricted 24 months
(Non-SCOMET) goods
(ii) Export Authorisation for SCOMET items 24 months
(iii) Import Authorisations for Restricted 18 months
items
(iv) EPCG Authorisation 24 months
(v) Advance Authorisations (AA) for Co-terminus with contracted
Deemed Exports duration of project execution or 12
months, whichever is more.
(vi) AA {except (v) above}, DFIA, 12 months from issue date.
Replenishment Authorisation for Gems
& Jewellery as per Chapter 4 of FTP.
(vii) Registration certificate for import/ Original shipment period as
export as per para 1.05 of FTP mentioned in the ICLC or as
(Transitional Arrangement) stipulated by DGFT.

However, EXIM Facilitation Committee (EFC) and Inter Ministerial Working Group
(IMWG) (for SCOMET items) may approve the grant of Export/ Import Authorisation
for a shorter / longer duration in specific cases to meet contractual
obligations/delivery schedule or on specific recommendation of the concerned
Technical / Administrative Ministry / Department / or any other agency.
b) DGFT may decide to issue specific authorisation/ class of authorisations for a
longer/shorter validity period. Any extension /revalidation in such cases to be
allowed only by DGFT.

pg. 16
2.17 Date of reckoning of Import / Export
(a) Date of reckoning of import is decided with reference to date of shipment /
dispatch of goods from supplying country as given in Paragraph 11.11 of
Handbook of Procedures and not the date of arrival of goods at an Indian port.

(b) Date of reckoning of export is decided with reference to date of shipment /

dispatch of goods from India as given in Paragraph 11.12 of Handbook of
Procedures. However, for benefit under FTP, Let Export Order (LEO) date shall
be the date of reckoning of export.

2.18 Validity of Authorisation/ Licence for import/export

(a) Authorisations must be valid on the date of import.
(b) Similarly, export obligation period of an Authorisation must be valid on the
date of export. However, AA/ EPCG Authorisation holder(s)may continue to
export post the export obligation period at their own risk and responsibility.
The affected exports would only be accounted for EO fulfilment only if the
authority concerned approves the EO extension.

2.19 Validity of Scrips

Scrips issued under the FTP must be valid on the date on which actual debit of duty is
made.

2.20 Revalidation of Import / Export Licence Certificate/ Authorisation /

Permissions for Non-SCOMET items
(a) Import Authorisation, may be revalidated, on merits for a period of six months
from date of expiry of validity by the DGFT (HQ).
(b) Export Authorisation, may be revalidated, on merits for a period of six months a
time and maximum upto 12 months by the DGFT (HQ).
(c) However, revalidation of freely transferable authorisation / duty credit scrips and
stock and sale (excluding SCOMET items) authorisation shall not be permitted unless
validity has expired while in custody of Customs Authority / RA / Government
Authority.
(d) Revalidation of Authorisation/Duty Credit Scrip shall also be allowed without
charging any fee for the period of delay (the period for which authorisation/scrip
holder was unable to utilise the same) or six months, whichever is less, due to the
following reasons:

pg. 17
(i) If Authorisation/Scrip or any amendment thereof could not be transmitted to
Customs Server within fifteen working days from the date of issue/amendment;
(ii) If Authorisation/Scrip rejected by Customs server with error Code
(iii) If request for issue of waiver of Bond/EODC was not considered within the
period specified under Para 11.10 of HBP, where complete application was
submitted within the validity of the Authorisation.
In such cases, revalidation shall be allowed from the date of endorsement for the
period of delay or six months, whichever is less. For example: Authorisation is issued
having initial validity of 12 months on 01.04.2017. It was transmitted to Customs
server on 01.04.2017 by DGFT server but it is accepted by Customs server on
31.10.2017. So, the Authorisation holder loses 7 months (still 5 months validity is
left). In such a case, RA shall allow revalidation for a period of 6 months (validity of 5
months is subsumed) from the date of endorsement.
The applicant shall submit request for endorsement of Authorisation/Scrip along with
screen shot of DGFT server as well as Customs Server in support of his claim. RA shall
verify the same before revalidation is allowed.
However, request must be made to RA concerned within a month from the date of
final acceptance of Authorisation/Scrip in the Customs Server.
Notwithstanding anything contained above, these provisions of revalidation shall not
apply wherever, the authorisation/scrip holder had clear 6 months period in hand for
utilisation.

2.21 Authority to Revalidate

Such revalidation under Paragraph 2.20 above would be permitted under specific
orders of Head of concerned Office and such revalidation would be maximum up to
the extent of custody period.

2.22 Application for Revalidation

An application for revalidation of authorisation may be made to the office which has
issued the authorisation.

PROCEDURE FOR ISSUING DUPLICATE COPIES

2.23 Duplicate copies of Export / Import Authorisation

Where a physical copy of Authorisation/Permissions/ Licence / Certificate / is lost or
misplaced, an application for issue of a duplicate may be made along with self-

pg. 18
declaration, as given in Appendix 2M, to concerned office where the original Licence
was issued.

2.24 Documents required for duplicate copy of freely transferable

Authorisation
Duplicate copy of freely transferable Authorisation may be issued against an
application accompanied with following documents:
(i) An application with fee equivalent to 10% of duty saved or duty credit (of
unutilized balance).
(ii) A copy of FIR reporting loss.
(iii) Self- declaration to indemnify revenue loss, which may be caused on account of
issue of such duplicate.

2.25 Exception
When an Authorisation is lost by a Government agency and a proof to this effect is
submitted, documents at serial nos. (i) to (iii) of Paragraph 2.24 above shall not be
required. In such cases, revalidation shall be for six months from date of endorsement.

2.26 Mechanism for issuing duplicates

RA concerned shall obtain a report regarding utilization of such Authorisation from
Custom authority at port of registration before issuing duplicate, for balance
unutilized.

2.27 Validity of duplicate Authorisation

Validity of duplicate Authorisation shall be co-terminus with original period. No
request shall be entertained if validity has expired.

2.28 Applicability of the provision

Provision of Paragraph 2.26 and 2.27 shall be applicable for cases covered under both
Paragraph 2.23 and 2.24.

BANK GUARANTEE /LUT/ CORPORATE GUARANTEE

2.29 Execution of BG/Legal undertaking for Advance Authorisation/

EPCG Authorisation
(a) Before clearance of goods through Customs, Authorisation holder shall execute
a BG/LUT with Customs Authorities. In such cases, RA shall endorse the
pg. 19
 following condition on the licence/ Authorisation: "BG / LUT as applicable, to
be executed with concerned Customs Authorities”.
(b) In case of indigenous sourcing, Authorisation holder shall furnish BG/ LUT to
RA as per Customs Circular No.58/2004 dated 31.10.04, as amended from time
to time. In case, the firm has already executed BG/LUT for the full value of the
licence/ certificate/ authorisation/ permission (covering the items
indigenously procured) to the Customs and furnishes proof of the same to
Regional Authority (RA), no BG/LUT shall be required to be executed with the
RA. The RA concerned shall endorse on the authorisation that the Customs
Authority shall release/redeem BG/LUT only after receipt of NOC or EODC from
the RA concerned. RA shall endorse a copy of the same along with a forwarding
letter to the Customs Authority at the Port of registration for their information
and record.
(c) A status holder or a PSU may also submit Corporate Guarantee in lieu of Bank
Guarantee/LUT in terms of the provisions of relevant Customs Circular in this
regard.

2.29A Any firm/ company coming under the NCLT proceedings shall make a
summary of statement of outstanding export obligations/liabilities under the FTP
schemes, indicating duty saved amounts and applicable interest till the date of start of
proceedings before the National Company Law Tribunal (NCLT), any penalty imposed
under FT (D&R) Act, any other dues such as fee etc., and submit the same to the RA
concerned and to NCLT, before the start of NCLT proceedings as part of the statutory
filings. The statement of consumption of inputs/procurement of capital goods,
attested by chartered engineer/chartered accountant, shall also be submitted along
with other documentary details of any partial fulfilment of Export Obligation claimed
towards offsetting the duty saved amount.

2.30 Advance Payment

In case, payment is received in advance and export / deemed export takes place
subsequently, application for an Authorisation shall be filed within specific period
following the month during which exports/ deemed export is made, unless otherwise
specified.

pg. 20
2.31 Import under Lease Financing
Import under lease financing shall be available under EOU/ SEZ scheme. Domestic
supply of capital goods to eligible categories of deemed exports shall be eligible for
benefits of deemed export as in paragraph 7.03 of FTP, even in cases where
supplies are under lease financing

2.32 Submission of Certified Copies of Documents

Wherever original documents have been submitted to a different RA / nominated
agency or to a different division of same RA, applicant can furnish photocopy of
documents duly certified by him in lieu of original.

WAREHOUSING FACILITY

2.33 Warehousing Facility

(a) Public / Private Customs Bonded Warehouses may be set up in DTA as per
Chapter-IX of Customs Act, 1962, to import items in terms of Paragraph 2.36 of
FTP. On receipt of goods, such warehouses shall keep these goods for one year
without payment of applicable customs duties. Goods can be cleared against Bill
of Entry for home consumption, on payment of custom duty and on submission
of Authorisation wherever required, after an order for clearance of such goods
for home consumption is issued by competent customs authorities. In case of
clearance against duty free categories /concessional duty categories, exemption
/ concession from duty shall be allowed.
(b) Goods can be re-exported without payment of customs duty provided shipping
bill or a bill of export is presented in respect of such goods; and order for export
of such goods has been made by competent customs authorities.

CERTIFICATES

2.34 Free Sale and Commerce Certificate

(a) (i) RAs may issue, on application, Free Sale and Commerce certificate for
export of items not covered under Drugs & Cosmetics Act, 1940, which have
usage in hospitals, nursing homes and clinics, for medical and surgical purposes
and are not prohibited for export. Validity of such certificate shall be two years
from date of issue unless otherwise specified.
(ii) For items falling under the Drug & Cosmetics Act, 1940, application for issue
of Free Sale & Commerce Certificate may be made to the Central Drug
Standards Control Organisation (CDSCO)
pg. 21
 (iii)An application for grant of Free Sale and Commerce Certificate may be
made to RA concerned as per format in ANF 2H of Appendices and Aayat Niryat
Forms with Annexure A therein. RA shall issue Free Sale and Commerce
Certificate as per Annexure B of ANF 2H.

(b) (i) RAs may also issue, on application, Free Sale and Commerce Certificate for
export of any other item which is not restricted or prohibited for export.
Validity of such certificate shall be two years from date of issue unless
otherwise specified.

(ii) An application for grant of Free Sale and Commerce Certificate for these
items may be made to RA concerned as per format in ANF 2H of Appendices
and Aayat Niryat Forms along with Annexure A therein. RA shall issue Free Sale
and Commerce Certificate as per Annexure B of ANF 2H.

2.35 End User Certificate

In case of import of any freely importable item in India, if a foreign Government insists
on certification of end user of the item, before permitting export of the same from
their country, RA may issue such certificates as per Appendix 2Q of Appendices and
Aayat Niryat Forms. The certificate shall be issued based on application made under
ANF 2J along with documents prescribed therein.

2.36 Imports under Indo-US Memorandum of Understanding

(a) Import of specified capital goods, raw materials and components, from United
States of America (USA) is subject to US Export Control Regulations. US
suppliers of such items are required to obtain an export authorisation based on
import certificate issued in India. The following are designated Import
Certificate Issuing Authorities (ICIA):

(i) Department of Electronics (DoE), for computer and computer-based

systems

(ii) Department for Promotion of Industry and Internal Trade (DPIIT),

Technical Support Wing (TSW), for organised sector units registered
under it, except for computers and computer-based systems;
(iii) Ministry of Defence (MoD), for defence related items;
(iv) DGFT for small scale industries and entities not covered above as well as
on behalf of any of the above;
pg. 22
 (v) Embassy of India, Washington, DC, on behalf of any of the above.
(b) Application for an import certificate shall be made in ANF 2K(i). Import
certificate in Appendix-2P(I)(a) may be issued by ICIA directly to importer with
a copy to (i) Ministry of External Affairs (MEA) (AMS Section), New Delhi, (ii)
DoE, New Delhi; and (iii) DGFT.
(c) However, this import certificate will not be regarded as a substitute for an
import authorisation in respect of items mentioned as restricted in ITC (HS)
and an import authorisation will have to be obtained for such items.
(d) India’s import and export with regard to USA’s unilateral export control items
[Crime Control (CC) Items as listed in Appendix 2P(ii)(a) and Regional Security
(RS) items as listed in Appendix 2P(ii)(b)] will be governed by the following
regulations:
Items listed at both Appendix 2P (ii)(a) and Appendix 2P(ii)(b) will be allowed
by DGFT for import from USA provided the importer submits the following
documents in ANF 2K(i):
(i) documentary proof of Bill of Lading indicating Port of USA,
(ii) legal undertaking that goods shall not be exported/ alienated; and
(iii) Import is with Actual User condition.

(e) In case the importer wants to subsequently export the imported items from
USA, or any part thereof, such export will require an authorisation from DGFT
as per ANF 2K(ii) and Export certificate will be issued in the format Appendix-
2P(i)(b).
(f) Import /export of such items shall be allowed only through EDI enabled ports
of India.

IMPORTS

2.37 Import of Consumer or Other goods as Gifts

(a) In terms of provisions contained in Paragraph 2.26 of FTP, an application for
grant of authorisation for import as gifts of items appearing as restricted for
imports in ITC (HS) shall be made to the DGFT as in ANF 2M along with
documents prescribed therein.
(b) Where recipient of a gift is a charitable, religious or an educational institution
registered under any law in force, and gift sought to be imported has been
exempted from payment of customs duty, such import shall be allowed by
customs authorities without an authorisation.
pg. 23
2.38 Import of Cheque Books /Ticket Forms etc.
Indian branches of foreign banks, insurance companies and travel agencies may
import cheque books, bank draft forms and travellers’ cheque forms without an
authorisation. Similarly, airlines / shipping companies operating in India, including
persons authorised by such airlines / shipping companies, may import passenger
ticket forms without an authorisation.

2.39 Import of Reconditioned/ Second Hand Aircraft Spares

Import Authorisation for reconditioned / second hand aircraft spares is not required
subject to NOC/ recommendation of Director General of Civil Aviation (DGCA),
Government of India.

2.40 Import of Replacement Goods

Goods or parts thereof on being imported and found defective or otherwise unfit for
use or which have been damaged after import, may be exported without an
Authorisation, and goods in replacement thereof may be supplied free of charge by
foreign suppliers or imported against a marine insurance or marine-cum-erection
insurance claim settled by an insurance company. Such goods shall be allowed
clearance by the customs authorities without an import Authorisation provided that:
(a) Shipment of replacement goods is made within 24 months from date of
clearance of previously imported goods through Customs or within guarantee
period in case of machines or parts thereof where such period is more than 24
months; and
(b) No remittance shall be allowed except for payment of insurance and freight
charges where replacement of goods by foreign suppliers is subject to payment
of insurance and / or freight by importer and documentary evidence to this
effect is produced while making remittance.

2.41 Other Conditions for Import of Replacement Goods

(a) In case of short-shipment, short-landing or loss in transit, import of
replacement goods will be permitted based on certificate issued by customs
authorities without an import Authorisation.
(b) This procedure shall also apply to cases in which short shipment of goods is
certified by foreign supplier, who has agreed to replace free of cost.
(c) Cases not covered by above provisions will be considered on merits by DGFT
for grant of Authorisation for replacement of goods for which an application
may be made as per paragraph 2.47 of HBP.

pg. 24
2.42 Import of Overseas Office Equipment
On winding up of overseas offices, set up with approval of RBI, used office equipment
and other items may be imported without Authorisation.

2.43 Import of Ammunition by Licensed /Authorised Arms Dealers

(a) Import of following types of ammunition are allowed against an Authorisation
by licensed arms dealers subject to conditions as may be specified:
(i) Shotgun Cartridges 28 bore;
(ii) Revolver Cartridges of .450, .455 and .45 bores;
(iii) Pistol Cartridges of .25, .30 Mauser, .450 and .45 bores;
(iv) Rifle Cartridges of 6.5 mm, .22 savage, .22 Hornet,300 Sherwood, 32/40,
.256, .275, .280, 7m/m Mauser, 7 m/m Man Schoener, 9m/m Mauser, 9
m/m Man Schoener, 8x57, 8x57S, 9.3 m/m, 9.5 m/m, .375 Magnum, .405,
.30.06, .270, .30/30 Winch, .318, .33 Winch, .275 Mag., .350 Mag.,
400/350, .369 Purdey, .450/400, .470, .32 Win, .458 Win, .380 Rook, .220
Swift and .44 Win. bores.
(b) An import Authorisation shall be issued at 5% of value of annual average sales
turnover of ammunition (whether indigenous or imported) during preceding
three licensing years subject to a minimum of Rs. 2000.
(c) An application for grant of an Authorisation for items listed above may be made
online to DGFT Hqrs in ANF 2M along with documents prescribed therein.

2.44 Duty Free Imports for specific Sectors

(A) R&D Equipment for Pharmaceuticals and Biotechnology Sector:

(i) Duty free import of goods (as specified in list 28 of Customs notification
No.21/2012 dated 17.3.2012, as amended from time to time) upto 25%
of FOB value of exports during preceding licensing year, shall be allowed.
(ii) The eligible unit may furnish an application given in Appendix-8A to RA
concerned duly countersigned by Chartered Accountant.
(iii) In respect of duty free import of R&D equipment, units not registered
with jurisdictional Customs authority shall be allowed to give Installation
Certificate issued by an independent Chartered Engineer.
(B) Agrochemicals Sector:

pg. 25
 (i) Duty free imports of goods as specified in list 28A of Customs notification
No. 21/2012 dated 17.3.2012, upto 1% of FOB value of exports made
during preceding licensing year, shall be allowed to agrochemicals sector
unit having export turnover of Rs. 20 crore or above during preceding
licensing year.
(ii) The eligible unit shall apply in form given in Appendix-8B to RA
concerned duly countersigned by Chartered Accountant.
(iii) In respect of duty free import of R&D equipment, units not registered
with jurisdictional Customs authority shall be allowed to give Installation
Certificate issued by an independent Chartered Engineer.

2.45 Import under Govt. to Govt. Agreements

Import of goods under Government-to-Government agreements may be allowed
without an Authorisation on production of necessary evidence to satisfaction of
Customs authorities.

2.46 Transfer of Imported Goods

(a) Cases where prior permission is required:
Transfer of imported goods which are subject to Actual User condition and have
become surplus to needs of Actual User, shall be made only with prior permission of
the issuing authority. Following information along with supporting documents shall
be furnished with request for grant of permission for transfer, to the issuing
authority:
(i) Reasons for transfer of imported material;
(ii) Name, address, IEC number and industrial Authorisation registration, if
any, of transferee;
(iii) Description, quantity and value of goods imported and those sought to be
transferred;
(iv) Copies of import Authorisation and bills of entry relating to imports
made;
(v) Terms and conditions of transfer as agreed upon between buyer and
seller.
(b) Cases where prior permission is not required
(i) in case of sale or otherwise by importer of freely importable goods;

pg. 26
 (ii) for goods imported with Actual User condition, provided such good is
freely importable without Actual User condition on date of transfer
(iii) for goods with AU Condition after a period of two years from the date of
import.
(iv) for transfer of Imported Firearms (a) after 10 years of import or (b) on
attaining the age of 60 years by such importer, subject to condition that
transferee fulfils conditions as in Arms Act and Rules there under.
(v) for transfer of weapon/s (firearm/s) imported by a Renowned Shooter
(as defined in Policy Condition 3 of Chapter 93 of ITC (HS) 2022) for the
purpose of his/her pursuing shooting as a sport to any upcoming shooter
as certified either by the National Rifle Association of India (NRAI) or the
Department of Sports, Ministry of Youth Affairs & Sports after two years
from the date of import. The transferee can subsequently transfer/resell
to any buyer as certified by the NRAI or Department of Sports for the sole
purpose of pursuing shooting as a sport after one year from the date of
its first sale. Such transfer/sale is subject to the provisions of the Arms
Act, 1959 and other rules/regulations by state/local police.
NRAI/Department of Sports will maintain the required records.

IMPORT OF RESTRICTED ITEMS

2.47 Import /Export of Restricted Items

(a) An application for grant of an Authorisation for import or export of items

mentioned as ‘Restricted’ in ITC (HS) may be made online to DGFT Hqrs in ANF
2M /ANF 2N respectively along with documents prescribed therein.

(b) An application for amendment in import or export Authorisation has be made

online to DGFT Hqrs.

2.48 EXIM Facilitation Committee

(a) Restricted item Authorisation may be granted by DGFT or any other RA
authorised by him in this behalf. DGFT / RA may take assistance and advice
of a Facilitation Committee while granting authorisation. The Assistance of
technical authorities may also be taken by seeking their comments in writing.
Facilitation Committee will consist of representatives of Technical Authorities
and Departments / Ministries concerned.

pg. 27
(b) Import/Export authorisations for a restricted item, if so, directed by the
competent authority, shall be issued for import/ Export through one of the sea
ports or air ports or ICDs or LCS, as per the option indicated, in writing, by the
applicant. Authorisation holder shall import at the port specified in the
Authorisation and thereafter all imports against said authorisation shall be
made only through that port, unless the authorisation holder obtains
permission from customs authority concerned to import through any other
specified port.

(c) EXIM Facilitation Committee (EFC) shall normally meet once every month.
Where a case has been deferred in EFC for want of comments from the
Technical Authorities and Departments /Ministries concerned but
subsequently, NOC(s) has / have been received from the concerned agency(ies)
with no divergence in views, authorisation shall be issued with the approval of
Chairman, EFC and the case shall be brought before EFC in its subsequent
meeting for approval on ex-post facto basis.

2.49 Import of Restricted items required by Hotels, Restaurants, Travel

Agents, Tour Operators and other Specified Categories
Items mentioned as restricted for imports in ITC (HS) required by hotels, restaurants,
travel agents and tour operators may be allowed against an Authorisation, based on
recommendation of Director General, Tourism, Government of India.
(a) Hotels, including tourist hotels, recognised by Director General of Tourism,
Government of India or a State Government shall be entitled to import
Authorisation upto a value of 25% of foreign exchange earned by them from
foreign tourists during preceding licensing year, for import of essential goods
related to hotel and tourism industry.
(b) Travel agents, tour operators, restaurants, and tourist transport
operators and other units for tourism, like adventure/ wildlife and convention
units, recognized by Director General of Tourism, Government of India, shall
be entitled to import authorisation up to a value of 10% of foreign
exchange earned by them during preceding licensing year, for import of
essential goods which are restricted for imports related to travel and tourism
industry, including office and other equipment required for their own
professional use.
(c) Import entitlement under paragraphs 2.49 (a) and 2.49 (b) of any one licensing
year can be carried forward, either in full or in part, and added to import
entitlement of two succeeding licensing years.

pg. 28
(d) Such imported goods may be transferred after 2 years with permission of
DGFT. No permission for transfer will be required in case the imported goods
are re-exported. However, re-export shall be subject to all conditionality, or
requirement of licence, or permission, as may be required under Schedule II of
ITC (HS).
(e) An application for grant of an Authorisation under paragraphs 2.49 (a) and 2.49
(b) may be made in ANF 2M to DGFT Hqrs through Director of Tourism,
Government of India.

2.50 Import of Restricted items for R&D by units of Government

All restricted items and items permitted to be imported by STEs, except live animals,
required for R&D purpose may be imported without an Authorisation by Government
recognized Research and Development units.

2.51 Import of Metallic Waste and Scrap

Import of any form of metallic waste, scrap will be subject to the condition that it will
not contain hazardous, toxic waste, radioactive contaminated waste / scrap
containing radioactive material, any type of arms, ammunition, mines, shells, live or
used cartridge or any other explosive material in any form either used or otherwise.
(a) Import of following types of metallic waste and scrap will be free subject to
conditions detailed below:
Sl. No. Exim Code Item description
1. 720410 00 Waste and scrap of cast iron
2. 72042190 Other
3. 72042920 Of High-speed steel
4. 72042990 Other
5. 72043000 Waste and scrap of tinned iron or Steel
6. 72044100 Turnings, shavings, chips, milling waste, saw dust,
fillings, trimmings and stampings, whether or not in
bundles.
7. 72044900 Other
8. 72045000 Re-melting scrap ingots
9. 74040012 Copper scrap
10. 74040022 Brass scrap
11. 75030010 Nickel scrap
12. 76020010 Aluminium scrap
13. 79020010 Zinc scrap

pg. 29
 14. 80020010 Tin scrap
15. 81042010 Magnesium scrap

(b) ‘Freely’ Importable metallic waste and scraps (shredded) as listed above shall
be permitted through all ports of India subject to following conditions:

(i) At the time of the clearance of goods, importer shall furnish to the
Customs pre-shipment inspection certificate as per the format to
Appendix 2H from any of the Inspection & Certification agencies given in
Appendix-2G, to the effect that the consignment was checked for
radiation level and scrap does not contain radiation level (gamma and
neutron) in excess of natural background. The certificate shall give the
value of background radiation level at that place as also the maximum
radiation level on the scrap; and
(ii) Importer shall also furnish copy of the contract with the exporter
stipulating that the consignment does not contain any radioactive
contaminated material in any form.
(c) Import from Hodaideh, Yemen and Bandar Abbas, Iran will be in shredded form
only.
(d) Import of un-shredded compressed and loose form of metallic waste, scrap
listed in paragraph 2.51(a) above in shall be subject to the following conditions:
-
(i) At the time of the clearance of goods, importer shall furnish to the
Customs pre-shipment inspection certificate as per the format in
Appendix 2H from any of the Inspection& Certification agencies given in
Appendix-2G to the effect that the consignment does not contain any
type of arms, ammunition, mines, shells, cartridges, or any other
explosive material in any form either used or otherwise, and that the
consignment was checked for radiation level and it does not contain
radiation level (gamma and neutron) in excess of natural background.
The certificate shall give the value of background radiation level at that
place as also the maximum radiation level on the scrap.
(ii) The imported item (s) is actually a metallic waste/ scrap /seconds
/defective as per the internationally accepted parameters for such a
classification.
(iii) Copy of the contract between the importer and the exporter stipulating
that the consignment does not contain any type of arms, ammunition,

pg. 30
 mines, shells, cartridges, radioactive contaminated, or any other
explosive material in any form either used or otherwise.
(iv) Import of scrap would take place only through following designated
ports and no exceptions would be allowed even in case of EOUs, SEZs: -
1. Chennai, 2. Cochin, 3. Ennore, 4. JNPT, 5. Kandla, 6. Mormugao, 7.
Mumbai, 8. New Mangalore, 9. Paradip, 10. Tuticorin, 11.
Vishakhapatnam, 12. Pipava 13. Mundra, 14. Kolkata 15. Krishnapatnam
and 16. Kattupalli 17. Hazira and 18. Kamarajar.
(v) Only entry sea ports will be designated and notified for import of un-
shredded Metallic Waste and Scrap subject to the following:

(i) Any sea port to be designated for import of un–shredded metallic

scrap will be required to install Radiation Portal Monitors and
Container Scanner with adequate security. The sea port having
completed the above shall approach jurisdictional Customs for
inspection and certification. Customs may give necessary clearance
on receipt of certification from AERB. On getting clearance from
Customs, DGFT will notify such a port as designated port for import
of un–shredded scrap.

(ii) The existing designated sea ports namely Chennai, Cochin, Ennore,
JNPT, Kandla, Mormugao, Mumbai, New Mangalore, Paradeep,
Tuticorin, Vishakhapatnam, Pipava, Mundra and Kolkata will be
allowed to import un-shredded scrap till 30.09.2021 by which time
they are required to install and operationalize Radiation Portal
Monitors and Container Scanner. Such sea ports which fail to meet
the deadline will be derecognised for the purpose of import of un-
shredded metallic scrap w.e.f. 01.10.2021

(iii) Further, any ICD can handle clearance of un–shredded metallic

scrap provided the same passes through any of the designated sea
ports as mentioned above or any new ports to be
notified/designated from time to time, where Radiation Portal
Monitors and Container Scanner are in operation and the
consignment is subjected to risk-based scanning/ monitoring as per
the protocol laid down by Customs.

(iv) Import consignments of metallic waste and scrap shall be subject to

pre-shipment inspection certificate (PSIC) from the country of
origin. However, metallic waste and scrap (both shredded and
pg. 31
 unshredded) imported from safe countries / region i.e., the USA, the
UK, Canada, New Zealand, Australia and the EU will not require
PSIC if consignments are cleared through eight (8) ports namely,
Chennai, Tuticorin, Kandla, JNPT, Mumbai Krishnapatnam, Mundra
and Kattupalli. Consignments from these six countries / regions
will be accompanied by certificate from the supplier / scrap yard
authority to the effect that it does not contain any radioactive
materials / explosives. These will however be subject to radiation
and explosive checks through portal monitors and container
scanner at these ports. Trans-shipments through these countries /
regions will not be allowed this facility. Import through remaining
eight (8) other ports (for both shredded and unshredded scrap /
waste), irrespective of country of origin, will be subject to PSIC.

2.52 Recognition as Pre-shipment Inspection Agency (PSIA) and issuance

of Pre- shipment Certificate (PSIC)
(a) Applications for recognition in respect of PSIAs have to be made online on
DGFT Website (https://dgft.gov.in) by payment of applicable fee in terms of
Appendix 2K of FTP.
(b) The online applications will be considered by an Inter-Ministerial
Committee.
(c) The recognized PSIAs will be notified under Appendix 2G for a period of
three years. At the end of 3 years PSIA has to make a fresh online application for
further recognition by DGFT.
(d) PSIA shall issue PSIC in the format given in Appendix 2H. PSIA shall
generate PSICs using the facility provided on the DGFT website.
(e) A PSIA can also carry out inspections in countries, where it does not have
a full-time equipped branch office but which falls within its area of
operation, by deputing its Inspectors. However, for such inspections in
other countries, the PSIA will be required to give prior intimation to
DGFT by sending an email (at [email protected]) and furnishing
details of visit / inspection done by the Inspector in PSIC.
(f) The PSIA applicant(s) may submit online application(s) initially without
bank guarantee, as required under S.No.9 of ANF-2L. Their applications
would not be rejected only on the ground of non-submission of bank
guarantee. Applicants would, however, be required to submit bank
guarantee or an equivalent financial instrument, before they are notified
as PSIA, by the competent authority.

pg. 32
 (g) Any application for amendment in instruments and/or areas of operation
of the existing PSIA has to be made online on the DGFT website.

2.53 Responsibility and Liability of PSIA and Importer

(a) In case of any mis-declaration in PSIC or mis-declaration in the online
application form for recognition as PSIA, the PSIA would be liable for
penal action under Foreign Trade (Development & Regulation) Act, 1992,
as amended, in addition to suspension/ cancellation of recognition.

(b) The importer and exporter would be jointly and severally responsible for
ensuring that the material imported is in accordance with the declaration
given in PSIC. In case of any mis-declaration, they shall be liable for penal
action under Foreign Trade (Development & Regulation) Act, 1992, as
amended.

(c) PSIA may generate and upload PSIC online through the DGFT website.
The PSIC shall be generated by the PSIA after the required inspection
has been carried out. Required Video or photographic evidence is to be
uploaded by the PSIA during this online PSIC process. The attested copy
of the PSIC (in pdf format) shall have to be uploaded by the PSIA on
DGFT website. The certificate shall be issued in prescribed form
Appendix 2H

(d) The PSIA will also be required to take photographs or make video of the
inspection carried out, duly capturing the following activities/details:

(i) Photograph(s) or video clipping of the place of inspection with

PSIA inspector (mandatory) and representatives of exporter /
importer, if available (optional); with time, date of the inspection
(at least 1 photograph or video clipping);

(ii) Photograph(s) or video clipping of the testing instrument(s) used

for inspection;

(iii) Photograph(s) or video clipping of the process of stuffing of

containers showing the container number (at least 1 photograph
or video clipping per container)

(iv) Photograph(s) or video clipping of the sealing process (at least 1

photograph or video clipping per container)
(v) One Photo of Inspector shall be captured with empty container in the
background having only one door closed (door with container
pg. 33
 number) and container number shall be clearly readable in that
photo. Another photo of Inspector shall be captured with sealed
container with same container number on the door clearly
readable
(vi) Photo of Instrument used for inspection (as indicated at serial no
(h) of PSIC) shall be captured along with container seal, having
container seal number and instrument serial number, visible in the
same photo
(e) The photographs and/ or video clippings [as per 2.53(d) above] shall be
uploaded on DGFT website (https://www.dgft.gov.inICP/) by PSIA at the
time of issue of PSIC.

2.54 Import of other kinds of metallic waste and scraps

Import of other kinds of metallic waste and scrap will be allowed in terms of
conditions of ITC (HS).

2.55 Imports of seconds and defectives

Import policy for second and defective, rags, PET bottles /waste, and ships is given in
ITC (HS).

2.56 Services of Inspection and Certification Agencies

Customs or any other Central or State Government authority may avail of services of
Inspection and Certification Agencies in Appendix 2I of the Appendices and Aayat
Niryat Forms, for certifying residual life as well as valuation / purchase price of
capital goods.

TARIFF RATE QUOTA SCHEME

2.57 Procedure for import under the Tariff Rate Quota Scheme
(a) Imports under the Tariff Rate Quota Scheme is governed as per the Customs
Notification No. 28/2020-Customs dated 23.06.2020 of Department of
Revenue, Ministry of Finance, Government of India as amended from time to
time.

(b) Tariff Rate Quota (TRQ) Imports for Crude Soya-bean oil and Crude Sunflower
seed oil shall be allocated during financial year 2022-23 only, up to quantities
per year as indicated below.

Item Description ITC(HS) TRQ per Year (in

pg. 34
 MT)
Crude Soya-bean oil, whether or not 15071000 20,00,000
degummed
Crude Sunflower seed oil 15121110 20,00,000
The duty exemption under the said TRQs may be availed as per the Ministry of
Finance (Department of Revenue) Notification No. 30/2022-Customs dated
24.05.2022.
Note: The procedure for allocation of quota for the year 2022-23 under para 2.57(b)
above has already been notified, vide Public Notice No. 10/2015-20 dated 24.05.2022
read with Public Notice Nos.50/2015-20 dated 11.01.2023 and 60/2015-20 dated
01.03.2023.

2.58 Eligible entities for allocation of quota

The following entities shall be eligible for allocation of quota with reference to
para 2.57(a) of HBP:
(a) Milk Powder (Tariff Code No. 0402.10 or 0402.21) and White Butter, Butter oil,
Anhydrous Milk Fat (0405): National Dairy Development Board (NDDB),
National Cooperative Dairy Federation (NCDF) and National Agricultural
Cooperative Marketing Federation of India Ltd. (NAFED).
(b) Maize (corn) (Tariff Code No. 1005.90): National Agricultural Cooperative
Marketing Federation of India Ltd.(NAFED) and State Cooperative Marketing
Federations.
(c) Crude sunflower seed or safflower oil or fractions thereof (Tariff Code No.
1512.11) and Refined rape, colza, canola or mustard oil, other (Tariff Code No.
1514.19 or 1514.99): National Dairy Development Board (NDDB), National
Agricultural Cooperative Marketing Federation of India Ltd.(NAFED) and
Central Warehousing Corporation (CWC), State Cooperative Marketing
Federation & State Cooperative Civil Supplies Corporation.

2.59 Conditions applicable on availing quotas

All eligible entities are eligible to avail quotas subject to the conditions as detailed
below:
(i) All eligible entities desiring availment of quota as mentioned above, may make
an online application to EFC in ANF-2M to DGFT, completed application forms
along with prescribed documents must be submitted on or before 1st March of
each financial year preceding to the year of quota

pg. 35
(ii) Imports have to be completed before 31st March of financial year i.e.
consignments must be cleared by customs authorities before this date.
(iii) Since import of maize (corn) is through STEs, the allottees of quota i.e.,
designated agencies in paragraph 2.58 (b) above for this item shall also be
granted an import Authorisation for allotted quantities as indicated at Sl.
No. 21 (b) of Customs Notification No. 21/2002 dated 1.3.2002 in terms of
paragraph 2.21 of FTP.
(iv) Application fee for these applications shall be paid according to procedure
contained in Appendix 2K of Appendices & Aayat Niryat Forms.
(v) EFC in DGFT will evaluate and allot quota among applicants by 31st March of
each financial year preceding to year of quota.

EXHIBITS AND SAMPLES

2.60 Exhibits Required for National and International Exhibitions or Fairs

and Demonstration
(a) Import / Export of exhibits, including the construction and decorative
materials, except items in the ‘Prohibited’ or SCOMET List, required for the
temporary stands of foreign / Indian exhibitors at exhibitions, fair or similar
show or display for a period of six months on re-export / re-import basis,
shall be allowed without an Authorisation on submission of a bond/ security
to Customs or ATA Carnet.

(b) Extension beyond six months for re-export / re-import will be considered
by Customs authorities on merits. Consumables such as paints, printed
material, pamphlets, literature etc. pertaining to exhibits need not be re-
exported/re-imported.

2.61 Sale of Exhibits

(a) Restricted Items: Sale of exhibits of restricted items, mentioned in ITC (HS),
imported for an international exhibition / fair may also be made, without an
Authorisation within bond period allowed for re-export, on payment of
applicable customs duties, subject to a ceiling limit of Rs.5 lakh (CIF) for such
exhibits for each exhibitor.
(b) Freely importable items: However, sale of exhibits of items which are freely
importable shall be allowed within bond period allowed for re-export on
payment of applicable customs duties.

pg. 36
(c) If goods brought for exhibition are not re-exported or sold within bond period
due to circumstances beyond control of importer, Customs Authorities may
allow extension of bond period on merits.

2.62 Import of Samples

(a) No Authorisation shall be required for Import of bonafide technical and trade
samples of items restricted in ITC (HS) except vegetable seeds, bees and new
drugs. Samples of tea not exceeding Rs.2000 (CIF) in one consignment shall be
allowed without an Authorisation by any person connected with Tea industry.
(b) Duty free import of samples upto Rs.3,00,000 for all exporters shall be allowed
as per terms and conditions of Customs Notification.

2.63 Exports of Samples / Exhibits

(a) Exports of trade and technical samples of freely exportable item shall be
allowed without any limit.
(b) An application for export of samples/exhibits, which are restricted for export,
may be made to DGFT as per ANF-2Q.

EXPORTS

2.64 Export Policy

Policy relating to Exports is given in Chapter-2 of FTP. Further, Schedule 2, Appendix-
1 of ITC (HS) specifies list of items, which may be exported without an Authorisation
but subject to terms and conditions specified.

2.65 Gifts / Spares / Replacement Goods

For export of gifts, indigenous / imported warranty spares and replacement goods in
excess of ceiling / period prescribed for exports of Gifts; export of Spares and export
of replacement goods in FTP, an application may be made to DGFT in ANF 2Q.

2.66 Export by post

In case of export by post, exporter shall submit following documents in lieu of
documents prescribed for export by sea/air:
(a) Bank Certificate of Export and Realisation as in e-BRC in Appendix 2U
(b) Relevant postal receipt
(c) Invoice duly attested by Customs Authorities.
pg. 37
2.67 Direct negotiation of export documents
In cases where exporter directly negotiates document (not through authorised dealer)
with permission of RBI, he is required to submit following documents for availing of
benefits under export promotion schemes:
(a) Permission from RBI allowing direct negotiation of documents (not required
for status holders),
(b) Copy of Foreign Inward Remittance Certificate (FIRC) as per Form 10-H of
Income Tax Department in lieu of BRC, and
(c) Statement giving details of shipping bills / invoice against which FIRC was
issued.

2.68 Application for Grant of Export Authorisation/Certificate/

Permission for non-SCOMET Items
An online application for grant of Export Authorisation in respect of restricted items
[other than items in Special Chemicals, Organisms, Materials, Equipment and
Technologies (SCOMET) List] mentioned in Appendix-3 to Schedule 2 of ITC (HS)
Classifications of Export and Import Items may be made in ANF 2N to DGFT
(Headquarters) along with documents prescribed therein. EFC shall consider
applications on merits for issue of export Authorisation.
EXPORT THROUGH STATE TRADING ENTERPRISES (STE)

2.69 Export of Items under (STE)

An application under ANF 2N for export of items mentioned in ITC (HS) under STE
regime may be made online to DGFT Hqrs as per paragraph 2.21 of FTP.

PROVISIONS FOR EXPORTERS/OTHER PROVISIONS FOR DOING TRADE AND

BUSINESS

2.70 Free of Cost Exports for status holders

Status holders shall be entitled to export freely exportable items on free of cost basis
for export promotion subject to an annual limit of Rs.10 lakh or 2% of average annual
export realisation during preceding three licensing years whichever is lower. For
Pharma exports, the annual limit would be 2% of the annual export realisation during
preceding three licensing years. In case of government supplies and supplies of
vaccines and lifesaving drugs to health programmes of international agencies such as
UN and WHO-PAHO, the annual limit shall be upto 8% of the average annual export
realisation during preceding three licensing years. Such free of cost supplies shall not

pg. 38
be entitled to Duty Drawback or any other export incentive under any export
promotion scheme.

2.71 Admissibility of benefits on payment through insurance cover

(I) Payment through ECGC cover would count for benefits under FTP.
(II) Payment through General/ Private Insurance companies:
Amount of Insurance Cover for transit loss by General Insurance and Private
Approved Insurance Companies in India would be treated as payment realized
for exports under various export promotion schemes.
(a) An applicant realizing export proceeds through Insurance Agency will approach
the concerned RA with the proof of payment issued by the concerned Insurance
Agency. RA after satisfying itself of the bona fide of the claim, will obtain
approval of Additional DGFT (EDI) and then will upload the value (in lieu of
eBRC value) in EDI system of DGFT for processing of the case.
(b) If the proof of payment issued by the Insurance Agency mentions claim value
both in foreign exchange and INR, RA will use the foreign exchange value for
processing. If the claim value is mentioned only in equivalent INR, RA will
convert this INR value in equivalent US$ using the exchange rate (published by
CBEC) applicable on the date of settlement of insurance claim”.

2.72 RBI write-off on export proceeds realization

Realization of export proceeds shall not be insisted under Foreign Trade Policy, if the
Reserve Bank of India (RBI) or any “Authorised Bank” (authorised by RBI for this
purpose) writes off the requirement of realization of export proceeds on merits and
the exporter produces a certificate from the concerned Foreign Mission of India about
the fact of non-recovery of export proceeds from the buyer. However, this would not
be applicable in self – write off cases.

2.73 Conversion of Shipping Bill from one Scheme to another

Customs Authorities, after recording reasons in writing, permit conversion of any
scheme-shipping bill on which benefit of that scheme has not been availed, in
accordance with the Regulations under Customs Act, 1962, and exporter would be
entitled to benefit under scheme in which shipment is subsequently converted.

2.74 Offsetting of Export Proceeds

Subject to specific approval of RBI, any payables, or equity investment made by an
Authorisation holder under any export promotion scheme, can be used to offset
pg. 39
receipts of his export proceeds. In such cases, offsetting would be equal to realisation
of export proceeds and exporter would have to submit following additional
documents:
(a) Appendix-2L in lieu of Bank Realisation Certificate.
(b) Specific permission of RBI.

PROVISIONS RELATED TO QUALITY CERTIFICATION:

2.75 Quality Certification

It has been a constant endeavour to promote quality standards in export product /
units manufacturing export product.
Agencies authorised to grant Quality Certification:

(a) List of such agencies authorised to grant quality certification is given in

Appendix-2I

(b) For ISO 9000 (Series) and for ISO 14000 (Series), the Agencies accredited with
National Accreditation Board for Certification Bodies (NABCB) under Quality
Council of India shall be deemed to be authorised under this Policy. List of such
accredited agencies is available on the web site www.qcin.org and also
provided under Appendix 2I

(c) The agencies for ISO (9000) Series & ISO 14000 Series have been accredited on
further classification of:

(i) Quality Management System (QMS)- http://www.qcin.org for Quality

Management Systems
(ii) Environmental Management System (EMS) - http://www.qcin.org for
Environmental Management system.
These agencies are listed in Appendix 2I of the AANF.

(d) Any agency desirous of enlistment in Appendix 2I may submit their application
as per Annexure I to Appendix 2I to the DGFT.

2.76 Track and Trace system for export of drug formulations

Procedure for Implementation of the Track and Trace system for export of drug
formulations will be as under:

pg. 40
i. The manufacturer or the exporter of drug formulations will print the barcode
as per GS1 Global Standard at different packaging levels to facilitate tracking and
tracing of their products. The details are as follows:

a) Primary Level:

Incorporation of two-dimensional (2D) barcode encoding unique and universal

global product identification code in the format of 14 digits Global Trade Item
Number (GTIN) along with batch number, expiry date and a unique serial
number of the primary pack. The bar code labeling at primary level is exempted
till further notification; however, the above-mentioned details are required to
be printed in human readable form on optional basis till further notification.

b) Secondary level:

Incorporation of one or two dimensional (1D or 2D) barcode encoding unique

and universal global product identification code in the format of 14 digits
Global Trade Item Number (GTIN) along with batch number, expiry date and a
unique serial number of the secondary pack. However, in case of monocartons
manufacturer or exporter shall affix bar code on mono carton containing one
primary pack on optional basis till further notification.

c) Tertiary Level:

Incorporation of one dimensional (1D) barcode encoding unique and universal

global product identification code in the format of 14 digits Global Trade Item
Number (GTIN) along with batch number, expiry date and a unique serial
number of the tertiary pack i.e., Serial Shipping Container Code (SSCC).

ii. Parent–Child Relationship for SSI and Non-SSI Manufacturers:

The manufacturer or exporter shall maintain the data in the parent-child relationship
for three levels of packaging i.e., Primary, Secondary and Tertiary packaging and their
movement in its supply chain.

iii. Maintenance of data of Parent-Child relationship:

The data mentioned in (ii) above shall be uploaded on the central portal of the
Government of India (http://dava.gov.in) by the manufacturer or exporter or its
designated agency before release of the drug formulations for sale or distribution.

iv. The responsibility of the correctness, completeness and ensuring timely upload
of data on the central portal shall be with the manufacturer or exporter.

pg. 41
v. In case, the Government of the importing country has mandated a specific
requirement, the exporter has the option of adhering to the same and in such a case, it
would not be necessary to comply with the stipulation under sub para (i) to (iv) above
and if an exporter is seeking to avail such exemption from bar coding prescribed by
the Government of India as above, the exporter is given the option to move an
application to the Pharmaceutical Export Promotion Council of India (Pharmexcil) for
this purpose, clearly specifying the nature of such an exemption in the interest of the
exports from the country. Pharmexcil shall dispose of such applications on case-to-
case basis with prior approval of Government. However, the tertiary level of
packaging will have additional printing of barcode as per Para 2 (i) (c) in addition to
importing country’s requirement, if any.

vi. Export of drugs manufactured by SSI and non-SSI units and having
manufacturing date on or before 31.03.2023 are exempted from maintenance of data
in the Parent-Child relationship for three levels of packaging and its uploading on
Central Portal (http://dava.gov.in).

vii All drugs manufactured by SSI or non-SSI units and having manufacturing date
after 31.03.2023 can be exported only if both tertiary and secondary packaging carry
barcoding as applicable and the relevant data as prescribed by DGFT is uploaded on
the Central Portal.

Explanation:

(a) For the purpose of this rule,

(i) Drug formulation means a formulation manufactured with a

license from Drug Control Authority under the provisions of Drugs
& Cosmetics Act and Rules made there under and registered as
“Drug” with the FDA of importing country.

(ii) Primary packaging means the package which is in direct physical

contact with the active ingredient.

(iii) Secondary packaging means a carton containing one or more

primary packs and includes a mono carton containing one primary
pack.

(iv) Tertiary packaging means a shipper containing one or more

secondary packs.

pg. 42
 (b) All relevant guidelines regarding grant of specific exemption(s) if any,
procedure of data requirement / maintenance / upload on central portal
and clarifications issued under this notification etc. will be available on
the central portal i.e. http://dava.gov.in

(c) It will be the responsibility of the drug manufactures/exporters as the

case may be, to satisfy the customs authorities that the export
consignment satisfies the conditions of the Notification.

EXPORT PROMOTION COUNCIL (EPC)/ COMMODITY BOARDS

2.77 Registering Authorities

(a) Registering Authority is a body notified by DGFT in this regard to register
importers/ exporters as its members by issuing RCMC.
(b) The list of notified Registering Authorities is at Appendix -2T.

2.78 Criteria for EPCs as Registering Authorities

In order to make the EPCs truly democratic and participative in nature and for better
governance and transparency, the criteria for them to function as Registering
Authority are being laid down as under:

(a) e-Voting: Electronic Voting would be mandatory for election to the posts of Vice
Chairman/Vice President and Executive Committee members with a view to ensuring
wider participation.

(b) Tenure of Elected Heads: The tenure of an elected head shall not be for more
than two years. The election of Chairman/President of the EPC shall be via Vice
Chairman/Vice President route. However, any member having held the post of
Chairman/President and/or Vice Chairman/Vice President may come back as Vice
Chairman/Vice President in the same council after a gap of not less than 4 years.

(c) Directions of the Central Government: EPCs acting as the Registering Authorities
shall abide by all directions of the Central Government in respect of promotion and
development of international trade.

2.79 Registration- cum- Membership Certificate (RCMC)

(a) An exporter may, on application given in ANF 2C register and become a
member of EPC. On being admitted to membership, applicant shall be granted
forthwith Registration-cum-Membership Certificate (RCMC) of EPC concerned, in
pg. 43
format given in Appendix 2R. In case an exporter desires to get registration as a
manufacturer exporter, he shall furnish evidence to that effect.
(b) Prospective / potential exporters may also, on application, register and become
an associate member of an EPC.

2.80 Applying for RCMC

(a) While applying for RCMC, an exporter has to declare his main line of business in
the application. The exporter is required to obtain RCMC from the Council which
is concerned with the product of his main line of business.

(b) In case an export product is not covered by any Export Promotion

Council/Commodity Board etc., RCMC in respect thereof is to be obtained from FIEO.
Further, in case of multi product exporters, not registered with any EPC, where main
line of business is yet to be settled, the exporter has an option to obtain RCMC from
Federation of Indian Exporters Organization (FIEO).

(c) In respect of multi product exporters having their head office/ registered office
in the North Eastern States, RCMC may be obtained from Shellac & Forest Products
Export Promotion Council (except for the products looked after by APEDA, Spices
Board and Tea Board).

(d) In respect of exporters of handicrafts and handloom products from the UTs of
Jammu & Kashmir and Ladakh, Director, Handicrafts, Government of Jammu &
Kashmir is authorised to issue RCMC.

2.81 Validity Period of RCMC

RCMC shall be deemed to be valid from 1st April of licensing year in which it was
issued and shall be valid for five years ending 31st March of the licensing year, unless
otherwise specified.

2.82 Intimation Regarding Change in Constitution of Business of RCMC

holder
In case of change in ownership, constitution, name or address of an exporter, it shall
be obligatory on part of RCMC holder to intimate such change to registering authority
within a period of one month from date of such change. Registering authority,
however, may condone delays on merits.

pg. 44
2.83 De- Registration
Registering authority may de-register an RCMC holder for a specified period for
violation of conditions of registration. Before such de-registration, RCMC holder shall
be given a show cause notice by registering authority, and an adequate and
reasonable opportunity to make a representation against the proposed de-
registration. Upon de–registration, concerned EPC shall intimate the same to all RAs.

2.84 Appeal Against De-registration

A person aggrieved by a decision of registering authority in respect of any matter
connected with issue of RCMC may prefer an appeal to DGFT or an officer designated
in this behalf within 45 days against said decision and decision of appellate authority
shall be final.

2.85 Directives of DGFT

DGFT may direct any registering authority to register or deregister an exporter or
otherwise issue such other directions to them consistent with and in order to
implement provisions of FT (D&R) Act, Rules and Orders made there under, FTP or
this Handbook.

2.86 Identity Cards for Importers /Exporters

(a) To facilitate collection of Authorisation and other documents from DGFT Hqrs and
RA, identity cards (valid for 3 years) may be issued to proprietor/ partners /
directors and authorised employees (not more than three), of importers and
exporters, upon online application

(b) In case of limited companies, more than three identity cards can be allotted per
company. In case of loss of an identity card, a duplicate card may be issued on the
basis of an self-declaration.

(c) Identity card would be issued electronically with QR code and a Unique Document
Identification Number (UDIN) for electronic verification.

2.87 Interview with authorised Officers

Officers may grant interview at their discretion to authorised representative of
importer / exporter. Interviews /clarifications may also be sought through E-mails.
Interactions to the extent possible should be through online medium/video
conference.

pg. 45
PREFERENTIAL TRADE AGREEMENTS

2.88 Free Trade Agreements (FTAs) / Preferential Trade Agreements

(PTAs)
India has always stood for a transparent, equitable, inclusive, predictable, non-
discriminatory and rules based international trading system. In this context, India’s
trade agreements may be seen as a measured and calibrated exposure of the Indian
economy to international competition. As of March, 2023; India has signed 13 FTAs
and 6 limited Preferential Trade Agreements (PTAs). India is presently engaged in
FTA negotiations with some of its trading partners, notable among these FTAs are:
India –UK Free Trade Agreement, India-EU Free Trade Agreement and India-Canada
Comprehensive Economic Partnership Agreement (CEPA)/Early Progress Trade
Agreement (EPTA).

(a) The list of the FTAs that have been signed by India are:

(i) India - Sri Lanka FTA

(ii) Agreement on South Asian Free Trade Agreement (SAFTA)
(iii) Revised Agreement of Cooperation between Government of India and
Nepal to control unauthorised trade
(iv) India - Bhutan Agreement on Trade Commerce and Transit
(v) India - Thailand FTA - Early Harvest Scheme (EHS)
(vi) India - Singapore Comprehensive Economic Cooperation Agreement
(CECA)
(vii) India – ASEAN CECA (Goods, Services and Investment)
(viii) India - South Korea Comprehensive Economic Partnership Agreement
(CEPA)
(ix) India - Japan CEPA
(x) India - Malaysia CECA
(xi) India –Mauritius CECPA
(xii) India –UAE CEPA
(xiii) India - Australia ECTA

(b) The list of Preferential Trade Agreements (PTAs) signed by India are:

(i) Asia Pacific Trade Agreement (APTA)

(ii) Global System of Trade Preferences (GSTP)
(iii) India - Afghanistan PTA
(iv) India - MERCOSUR PTA

pg. 46
 (v) India - Chile PTA
(vi) SAARC Preferential Trading Arrangement (SAPTA)

(c) The list of these agreements with the participating countries as well as their
entry into force is given in Appendix 2A.

(d) Fees chargeable for issuance of preferential Certificate of Origin is as detailed

in Appendix – 2K. The same would also be applicable as verification fee for
Rules of Origin Certificate issued under any Free Trade Agreements, in case of
verification as detailed in Appendix – 2K. However, the provision of Tatkal
certificate of origin as being provided by some of the agencies would be
discontinued. The Certificate of origin will be delivered within 24
hours/1(one) working day of the application made.

2.89 Unilateral Tariff Preferences

Under these schemes, both developed and developing countries grant unilateral tariff
preferences to exports from developing countries including Least Developed
Countries (LDCs). Some of these schemes are:
(A) Generalised System of Preferences (GSP):

(a) GSP is a non-contractual instrument by which industrialized (developed)

countries unilaterally and based on non-reciprocity extend tariff concessions to
developing countries. Following countries extend tariff preferences under their GSP
Scheme: (i) United States of America (ii) New Zealand (iii) Belarus (iv) European
Union (v) Japan (vi) Russia (vii) Canada(viii) Norway (ix) Australia (only to LDCs)
and (x) Switzerland

(b) GSP schemes of these countries detail sectors / products and tariff lines under
which benefits are available, including conditions and procedures governing benefits.
These schemes are renewed and modified from time to time. Normally Customs of
GSP offering countries require information in Form ‘A’ (prescribed for GSP Rules of
Origin) duly filled by exporters of beneficiary countries and certified by authorised
agencies. List of agencies authorised to issue GSP CoO is given in Appendix-2C.

(c) (i) The European Union (EU) has introduced a self-certification scheme for
certifying the rules of origin under GSP from 1.1.2017 onwards. Under the
Registered Exporter System (REX), exporters with a REX number are able to
self-certify the Statement on Origin of their goods being exported to EU under

pg. 47
 the GSP Scheme. The registration on REX is without any fee or charges. The
details of the scheme are at Annexure-1 to Appendix-2C.

(ii) The competent Local Authorities would undertake post verification of self-
certified Certificate of Origin based on the request of the importers/customs
agencies of the importing country and the fee to be changed is detailed in
Appendix 2K. Agencies may charge TA and DA, as per government rates,
separately from the unit.

(iii) Further, as per the conditions required to avail GSP benefit under self-
certification system, the beneficiary country needs to have a verification
system of such self-certified certificates of origin. The standard operating
procedure for verification of the self-certified e-CoOs, to be followed by all
Authorized agencies/Local Administrators is detailed in Annexure-II to
Appendix-2C.

(B) Duty Free Tariff Preference (DFTP) Scheme for LDCs:

(a) The mandate for Duty Free Quota Free (DFQF) access to Least Developed
Countries (LDCs) came from Paragraph 47 of the Hong Kong Ministerial Declaration
of December 2005. India became the first developing country to extend this facility to
LDCs through its Duty Free Tariff Preference (DFTP) Scheme for LDCs which came
into effect in August, 2008 with tariff reductions spread over five years. The Scheme
provided preferential market access on tariff lines that comprise 92.5% of global
exports of all LDCs.

(b) Subsequently in 2014, the Scheme was modified both with reference to
increase in coverage as well as its simplification. This was in response to requests
from several LDCs for additional product coverage on lines of of their export interest
and simplification of the Rules of Origin procedures. Under the new expanded DFTP
Scheme, India is granting duty free access on 96.4% of the total tariff lines, thereby
retaining only about 3.6% of lines in the Exclusion and Positive Lists.For details
Department of Commerce Website. and Customs’ Notification No.8/2014 dated 1st
April, 2014 may also be referred to in this regard.

2.90 Certificates of Origin (CoO)

(a) Certificate of Origin (CoO) is an instrument to establish evidence on origin of
goods imported into any country.

pg. 48
(b) There are two categories of CoO viz.
(i) Preferential and
(ii) Non preferential

2.91 Rules of Origin (Preferential)

(a) The rules of origin are the rules that determine the origin of a good for the
purpose of exports to a trading partner. Under an FTA, PTA or a unilateral
tariff concession, the tariff concessions are granted by an importing country
only when these prescribed rules of origin are adhered to. Rules of origin also
facilitate in computation of trade statistics and for determination and
imposition of trade remedial measures.

(b) Some of the key criteria used in the determination of the rules of origin are:

(i) Wholly obtained

(ii) Change in tariff classification
(iii) Value addition
(iv) Non minimal operations

(c) For exports under India’s FTAs, PTAs and GSP, specified agencies are
authorised to issue the certificates of origin, they shall also provide services
relating to issue of CoO, including details regarding rules of origin, list of items
covered by an agreement, extent of tariff preference, verification and
certification of eligibility. The list of these agencies authorised under the
various FTAs/ PTAs is given in Appendix 2B

(d) Export Inspection Council (EIC) is the agency authorised to print blank
certificates. The website of the EIC (www.eicindia.gov.in) provides procedural
details (including fee) for issuance of the certificate of origin.

2.92 TRQ under FTA/CECA

Government, from time to time, undertakes commitments for import under Tariff
Rate Quota (TRQ) in various FTA/CECA. Accordingly, DGFT notifies the procedure for
administration of TRQ from time to time. The Tariff Rate Quotas as existing is as
under:

pg. 49
Description HS No. In/out In/out Notification TRQ
of of
quota quota
rate rate
(%) as (%)
per As per
WTO Indian
Tariff
Crude soya oil from 1507 10 00 - 10% 57/2009 dated 30,000 MT
Paraguay under 30/05/2009
India- Mercosur
Trade
Agreement
Vanaspati, bakery 1516, 1517 - - No.2/2007Customs *2,50,000
shortening and or 1518 dated 5 January 2007 MT
th

margarine (other than

from Sri Lanka 15161000,
15171010,
15179030
and
15180040
which are
prohibited
for import)
Pepper from Sri 0904 - - No.2/2007Customs *2500 MT
Lanka dated 5th January 2007
Desiccated Coconut 08011100 - - No.2/2007Customs *500 MT
from Sri Lanka dated 5th January
2007
Articles of apparel 61, 62 - 5%/10 26/2000-Cus List 3 8 million
and clothing % pieces
accessories
imported from Sri
Lanka
Tea and preparagra 2101 - 15%/30 26/2000-Cus List 4 15 million
phtions thereof % kgs.
imported from Sri
Lanka
Vegetable fats 22/2007-Cus 5th June 1 Lakh
(Vanaspati) from 2007 MT
Nepal
Acrylic -do- 10,000 MT
Yarn from Nepal
Copper products Chapter 74 -do- 10,000 MT
from Nepal of ITC(HS)
and 8544
pg. 50
Zinc Oxide from -do- 2500MT
Nepal
The following items are permitted under the TRQ under India-Mauritius CECPA#
Fresh : -- 06031900 - 30% No. 25/2021-Customs 15 tons
Other dated 31st March,
2021
Pineapples 08043000 - 10% 1000 tons
Lichi 08109060 - 10% 250 tons
Vanilla : Neither 09051000 - 10% 15 tons
crushed nor ground
Vanilla : 09052000 - 10% 1 ton
Crushed or ground
Tunas 16041410 - 0% 7000 tons
Other 16041490 - 0% 7000 tons
Other prepared or 16042000 - 0% 7000 tons
preserved fish
Other 17011490 - 10% 15000 tons
(Specialty Sugar)
Beer made from 22030000 - 25% 2,000,000
malt. litres
Fruit Wine: Other 22060000 - 0% 5000 litres
fermented
beverages
(for example,
cider, perry, mead,
sake);mixtures of
fermented
beverages and
mixtures of
fermented
beverages and non-
alcoholic
beverages, not
elsewhere specified
or included.
In containers 22084011 - 0% No. 25/2021-Customs 1.50
holding 2 l or less: - dated 31st March, million
--- Rum 2021 litres
In containers 22084012 - 0% 1.50
holding 2 l million
or less: ---Other litres
Other: ---- 22084091 - 0% 1.50
Rum million
litres

pg. 51
Other: ---- other 22084092 - 0% 1.50
million
litres
Articles of Apparel 6102; - - Details of the HS Codes 7.5 million
and Clothing 6103; as in Table 3 of the pieces$
Accessories. 6104; above
6105; Notification
6106;
6109;6110;
6111; 6112
6203;
6304;
The following items are permitted under the TRQ under India-UAE CEPA#

HS Effect
Tariff
8 Descript ive
Modality Schedule of Tariff Rate Concessions (%)
Co ion Rate
Offered
de (%)
Linear
low-
density
polyethy
lene
(LLDPE)
, in
which
39 ethylene
01 monome
7.5
10 r unit TR of 3.75
10 contribu 7.0 6.5 6.0 5.0 3.75 3.75
50% in 5 3.75 3.75 3.75
tes 95% years
or more (TRQ (TRQ (TRQ (TRQ (TRQ (TRQ
with (TRQ (TRQ - (TRQ - (TRQ -
by - - - - - -
specified - 105,0 105,0 105,0
weight 45,00 50,50 56,00 61,50 67,50 105,0
year- 86,30 00 00 00
of the 0 0 0 0 0 00
wise 0 MT) MT) MT)
total MT) MT) MT) MT) MT) MT)
TRQs MT)
polymer
content
Low
39
density
01
polyethy 7.5
10
lene
20
(LDPE)
39 Other
01 Polyethy 7.5
10 lene
pg. 52
90 having a
specific
gravity
of less
than
0.94
TR of 3.75 3.75
Polyethy 7.0 6.5 6.0 5.0 3.75
50% in 5 3.75 3.75 3.75
lene
39 years (
having a (TRQ (TRQ (TRQ (TRQ (TRQ
01 with (TRQ (TRQ (TRQ - (TRQ - TRQ -
specific 7.5 - - - - -
20 specified - - 285,0 285,0 285,0
gravity 150,0 168,0 186,0 204,0 285,0
00 year- 222,0 252,0 00 00 00
of 0.94 00 00 00 00 00
wise 00 00 MT) MT) MT)
or more MT) MT) MT) MT) MT)
TRQs MT) MT)
Linear
low-
density
polyethy
lene
(LLDPE)
, in
which
39 ethylene
01 monome
7.5
40 r unit
10 contribu
tes less TR of
7.0 6.5 6.0 5.0 3.75 3.75 3.75 3.75
than 95 50% in 5 3.75 3.75
% by years
(TRQ (TRQ (TRQ (TRQ (TRQ (TRQ ( (TRQ
weight with (TRQ - (TRQ -
- - - - - - TRQ - -
of the specified 105,0 105,0
45,00 50,50 56,00 61,50 67,50 86,30 105,0 105,0
total year- 00 00
0 0 0 0 0 0 00 00
polymer wise MT) MT)
MT) MT) MT) MT) MT) MT) MT) MT)
content TRQs
Other
Ethylene
-alpha-
olefin
39 copolym
01 ers,
7.5
40 having a
90 specific
gravity
of less
than
0.94

pg. 53
 3.75 3.75
Other 7.0 6.5 6.0 5.0
3.75
polymer 3.75 3.75 3.75
39
s of (TRQ (TRQ (TRQ (TRQ
01 (TRQ (TRQ (TRQ
ethylene 7.5 - - - - (TRQ - (TRQ - (TRQ -
90 - - -
, in 11,00 12,00 13,00 14,00 25,00 25,00 25,00
00 16,00 20,60 25,00
primary 0 0 0 0 0 MT) 0 MT) 0 MT)
0 0 0 MT)
sources MT) MT) MT) MT)
MT) MT)
3.75 3.75
7.0 6.5 6.0 5.0 3.75
3.75 3.75 3.75
39
(TRQ (T (TRQ (TRQ (TRQ
02 Polypro (TRQ (TRQ (TRQ - (TRQ - (TRQ -
7.5 - RQ - - - -
10 pylene - - 158,5 158,5 158,5
70,00 77,50 85,00 92,50 158,5
00 100,0 129,2 00 00 00
0 0 0 0 00
00 00 MT) MT) MT)
MT) MT) MT) MT) MT)
MT) MT)
7.0 6.5 6.0 5.0 3.75 3.75 3.75
3.75 3.75 3.75
39 Propyle
(TRQ (TRQ (TRQ (TR (TRQ (TRQ (TRQ
02 ne (TRQ - (TRQ - (TRQ -
7.5 - - - Q- - - -
30 copolym 112,0 112,0 112,0
50,00 55,00 60,00 65,00 70,00 90,90 112,0
00 ers 00 00 00
0 0 0 0 0 0 00
MT) MT) MT)
MT) MT) MT) MT) MT) MT) MT)
Other
polymer
s of 7.0 6.5 6.0 5.0 3.75 3.75 3.75
3.75 3.75 3.75
39 propyle
02 ne or of (TRQ (TRQ (TRQ (TRQ (TR (TRQ (TRQ
7.5 (TRQ - (TRQ - (TRQ -
90 other - - - - Q- - -
9,500 9,500 9,500
00 olefins, 4,000 4,500 5,000 5,500 6,000 7,700 9,500
MT) MT) MT)
in MT) MT) MT) MT) MT) MT) MT)
primary
forms
Emulsio
n grade
PVC 9 8 7 6 5 5 5 5 5 5
39
resin /
04
PVC 10 TR
10
Pasteres (Cumulat
10
in/ PVC ive
dispersi Annual
on resin TRQ of
39 Suspensi 60,000
04 on grade MT)
10
10 PVC 9 8 7 6 5 5 5 5 5 5
20 resin
39 Other
10
04 Poly
pg. 54
10 (vinyl 9 8 7 6 5 5 5 5 5 5
90 chloride
), not
mixed
with any
other
substanc
es
Non-
plasticis
ed poly 9 8 7 6 5 5 5 5 5 5
39 (vinyl
04 chloride
21 ), mixed 10
00 with
other
substanc
es
39 Poly(vin 9 8 7 6 5 5 5 5 5 5
04 yl
10
30 derivati
10 ves)

Other
39 Vinyl 9 8 7 6 5 5 5 5 5 5
04 chloride
-vinyl 10
30
90 acetate
copolym
ers
Poly
(vinyl
fluoride) 7 6.5 6 5 3.75 3.75 3.75 3.75 3.75 3.75
, in one
39 of the
04 forms
7.5
69 mention
10 ed in
Note
6(b) to
this
Chapter
Chlorina 9 8 7 6 5 5 5 5 5 5
39
ted poly
04
vinyl 10
90
chloride
10
(CPVC)

pg. 55
 resin
Other
Polymer
s of vinyl 7 6.5 6 5 3.75 3.75 3.75 3.75 3.75 3.75
chloride
39 or of
04 other
7.5
90 halogen
90 ated
olefins,
in
primary
forms
71 Non-
08 monetar
10
11 y gold
00 powder 1% 1% 1% 1% 1% 1%
1% 1% 1% 1%
absol absol absol absol absol absol
TR absolu absolu absolu absol
ute ute ute ute ute ute
Other (Tariff te te te ute
duty duty duty duty duty duty
unwrou concessi duty duty duty duty
71 reduc reduc reduc reduc reduc reduc
ght on/relief reduct reduct reduct reduc
08 tion tion tion tion tion tion
forms of 10 of 1% in ion ion ion tion
12 over over over over over over
non- absolute over over over over
00 the the the the the the
monetar percenta the the the the
appli appli appli appli appli appli
y gold ge terms, applie applie applie applie
ed ed ed ed ed ed
TRQ of d d d d
rate rate rate rate rate rate
200 tons rate(T rate(T rate(T rate(T
Other (TRQ (TRQ (TRQ (TRQ (TRQ (TRQ
phased RQ of RQ of RQ of RQ of
semi- of of of of of of
in 5 200 200 200 200
71 manufac 120 140 160 180 200 200
years) tonne tonne tonne tonne
08 tured tonne tonn tonne tonne tonne tonne
10 s) s) s) s)
13 forms of s) es) s) s) s) s)
00 non-
monetar
y gold
Articles
of
71
jeweller
13
y of 20
19 19 18 17 16 15 15 15 15 15 15
gold,
10 TR (TRQ (TRQ (TRQ (TRQ (TRQ (TRQ (TR (TRQ (TRQ (TRQ (TRQ
unstudd
of 2.5 of of of of of Q of of of of of
ed
Tonnes) 2100 2200 2300 2400 2500 2500 2500 2500 2500 2500
Articles
71 kg) kg) kg) kg) kg) kg) kg) kg) kg) kg)
of
13
jeweller 20
19
y of
20
gold, set
pg. 56
 with
pearls
Articles
of
71
jeweller
13
y of gold 20
19
set with
30
diamond
s
Articles
of
jewllery
of gold,
71
set with
13
other 20
19
precious
40
and
semi-
precious
stones
Copper
weld
74 wire,
08 cross
5
11 sectional
10 dimensi 0.0 0.0
on >
TEP over 1.0 0.0 0.0 0.0
6mm 4.0 0.0
5 years 3.0 2.0
Other (TRQ (TRQ
(TRQ of (TRQ (TRQ (TRQ - (TRQ -
wire of (TRQ (TRQ - -
150% of - (TRQ - Movin Movin
refined - - Movi Movin
3 years 95,00 - (TRQ Movin g g
copper, 85,00 125,0 ng g
moving 0 105,0 - g Avera Avera
which 0 00 Aver Avera
74 average MT) 00 115,0 Avera ge of ge of
the MT) MT) age ge of
08 volume) MT) 00 ge of Years Years
maximu 5 of Years
11 MT) Years 4 to 6 5 to 7
m cross- Years 6 to 8
90 3 to 5 in MT) in MT)
sectional 2 to in
in MT)
dimensi 4 in MT)
on MT)
exceeds
6 mm
Copper TEP over 3.0 2.0 1.0 0.0 0.0 0.0 0.0 0.0 0.0
4.0
74 weld 5 years
08 wire, (TRQ of (TRQ (TRQ - (TRQ -
5 (TRQ
19 cross 150% of (TRQ (TRQ (TRQ (TRQ - Movin Movin (TRQ
- 270
10 sectional 3 years - (TRQ - - 400 - Movin g g -
MT)
dimensi moving 302.5 - 335 367.5 MT) Movi g Avera Avera Movin

pg. 57
 on < average MT) MT) MT) ng Avera ge of ge of g
6mm volume) Aver ge of Years Years Avera
age Years 4 to 6 5 to 7 ge of
of 3 to 5 in MT) in MT) Years
Years in MT) 6 to 8
Welding 2 to in
wire of 4 in MT)
74 copper, MT)
08 cross
5
19 sectional
20 dimensi
on <
6mm
Other
wire of
refined
74
copper,
08
cross 5
19
sectional
90
dimensi
on <
6mm
Imports of Items under the TRQ of the India- Aus ECTA
HS code Item Description In Quota rate TRQ Quantity TRQ Quantity
(%) for Calendar Calendar Year
year 2022 2023 onwards
07134000 Lentils 50% of the
applied 1,233 MTs 1,50,000 MTs
rate of duty
08021100 In shell almonds 50% of the
08021200 Shelled almonds applied 279 MTs 34,000 MTs
rate of duty
08051000 Oranges 50% of the
08052100 Mandarins (including tangerines applied 113 MTs 13,700 MTs
& satsumas) rate of duty
08083000 Pears 50% of the
applied 30 MTs 3,700 MTs
rate of duty
52010020 Extra Long Staple Cotton of 0% duty
419 MTs 51,000 MTs
minimum 28 mm staple length
# Imports will be permitted subject to the arrangements / Procedure as laid down in
Annexure-I, II & III, IV & V of Appendix-2A.

pg. 58
2.93 Rules of Origin (Non-Preferential)
(a) Rules of Origin (Non-Preferential) criteria are as under:
(I) Goods are to be manufactured by the exporting entity as per the
definition of “Manufacture” in Paragraph 11.31 of FTP; and

(II) If imported inputs (Duty Paid or Duty Free) have been used for the
production of export product, the export product can be considered to
be originating in India (Non-Preferential) only if the imported inputs
undergo the processing/ operations that exceed the following:

(i) simple operations consisting of removal of dust, sifting or

screening, sorting, classifying, matching (including the making-up of
sets of articles), washing, painting, cutting;

(ii) changes of packing and breaking up and assembly of

consignments;

(iii) simple cutting, slicing and repacking or placing in bottles, flasks,

bags, boxes, fixing on cards or boards, and all other simple packing
operations;

(iv) operations to ensure the preservation of products in good

condition during transport and storage (such as drying, freezing,
keeping in brine, ventilation, spreading out, chilling, placing in salt,
sulphur dioxide or other aqueous solutions, removal of damaged parts,
and like operations);
(v) affixing of marks, labels or other like distinguishing signs on
products or their packaging;

(vi) simple mixing of products;

(vii) simple assembly of parts of products to constitute a complete

product;

(viii) disassembly;

(ix) slaughter which means the mere killing of animals; and

pg. 59
 (x) mere dilution with water or another substance that does not
materially alter the characteristics of the products.

(b) Government has also nominated certain agencies to issue Non-Preferential

Certificate of Origin (CoO). These CoOs evidence origin of goods and do not bestow
any right to preferential tariffs. List of notified agencies is provided in Appendix–2E.
In addition, agencies authorised to issue Preferential CoO are also authorised to issue
Non-Preferential CoO.

(c) All exporters who are required to submit CoO (Non-Preferential) would have
to apply to any of agencies enlisted in Appendix 2E with following documents:

(i) Details of quantum / origin of inputs / consumables used in export product.

(ii) Two copies of invoices.
(iii) Packing list in duplicate for concerned invoice.
(iv) Fee of Rs.200/- per certificate

(d) The agency would ensure that goods are of Indian origin as per criteria
defined in (a) above before granting CoO (Non-Preferential). Certificate would be
issued as per format given in Annexure-II to Appendix 2 E. It should be ensured that
no correction/re-type is made on certificate. Any agency desirous of enlistment in
Appendix– 2 E may submit their application as per Annexure-I to Appendix 2E to
DGFT.

(e) Non-preferential - Self Certification: Manufacturer exporters who are also

Status Holders shall be eligible to self-certify their goods as originating from India, if
goods qualify the criteria, as laid down in (a) above, as per Annexure –III to
Appendix 2E.

2.94 Approved Exporter Scheme (AES) for self-certification

Details of the Scheme are provided in Appendix 2F of ANF.

POLICY INTERPRETATION AND RELAXATIONS

2.95 Application to PIC

Application for seeking interpretation of any policy provision shall be made in ANF-2F
to Policy Interpretation Committee (in the Hqrs.) under Para 2.58(b) of FTP.

pg. 60
2.96 Application to PRC
(a) Application to the Policy Relaxation Committee (PRC) under Para 2.59 FTP is to
be made online in ANF-2D with the prescribed fee and documents. Similarly,
under Para 2.60 of FTP, application for review of decision of any committee or a
decision/order by any subordinate Authority in the Directorate General of
Foreign Trade is required to be submitted online in ANF-2E.
(b) Director General of Foreign Trade shall be the Chairman of PRC with all
Additional DGFTs, all Joint DGFTs in charge of Policy Divisions in Hqrs as
members. The Additional/Joint DGFT (PRC) shall act as Member Secretary; and
the Committee can Co-opt member/s with specific expertise/experience as and
when required.

2.97 Application to EPCG Committee

(a) Application to the Export Promotion Capital Goods (EPCG) Committee under
Para 2.59 of FTP is to be made online in ANF-2D with the prescribed fee in
terms of Appendix-2K with required documents.

(b) Additional DGFT in-charge of EPCG shall be the Chairman of the EPCG
Committee, with Joint DGFT (EPCG) as Member Secretary and official from
Department of Revenue as member. Representative(s) from concerned line
Ministry / Department may be co-opted as member, as and when required.

pg. 61
CHAPTER 3

Developing Districts
as Export Hubs
 Chapter-3
Developing Districts as Export Hubs

3.01 Policy
Policy for Developing Districts as Export hubs is given in Chapter 3 of FTP.

3.02 Objective of policy

To convert each District of the country into an Export Hub by identifying products
with export potential in the District, addressing bottlenecks for exporting these
products, supporting local exporters/manufacturers to scale and find potential buyers
outside India with the aim of promoting exports, manufacturing and services industry
in the District. To enable a conducive foreign trade environment, any policy strategy
to boost exports formulated by the Central Government can only be effectively
implemented with the collaboration of State Governments and the District
Administration. Earlier, export promotion was a subject, primarily dealt by only the
Central government, without any active mechanism involving the State or District
level stakeholders into the decision making to promote goods and services produced
at the grassroots level. The export promotion activity needs to be decentralized, for
both formulation and implementation purposes, with an objective to boost local
production and make Districts active stakeholders in driving export of local
products/services.

3.03 District Export Promotion Committees -Institutional Mechanism at

District Level
Each District has a District Export Promotion Committee (DEPC) which is mostly
chaired by Collector/DM/DC of the District and co-chaired by designated DGFT
Regional Authority with various other stakeholders as its members.

The likely composition of the DEPC is as under:

Serial Official/Department Role

No.

1 Collector/DM/DC Chairperson
2 Designated DGFT Regional Authority Co-Chair
3 GM – District Industries Center (DIC) Convener

pg. 63
 4 Nominated member from the State Government( Commerce& Member
Industries Department)
5 Lead Bank Manager Member
6 Representative - Department of MSME, Govt. of India Member
7 Representative – Sector Specific Export promotion Council Member
8 Representative – Quality & Standards Implementation body Member
9 Representative from District Trade/Commerce Associations Member
10 Sector Specific Ministry in Government of India (Agriculture, Member
Fisheries, plantation boards etc.)
11 Sector Specific Ministry of the State Government Member
12 Sectoral Agencies specific to Product identified in each Member
District (NABARD etc.)
13 Other State Government Representative (As per Member
requirement)

3.04 District Export Promotion Committees –Functions

The primary function of the DEPC will be to prepare and implement District specific
Export Action Plans in collaboration with all the relevant stakeholders from the
Center, State and the District level.
The preliminary exercise may include an assessment of a district to identify the
current export profile, its further potential in the district, quantifiable targets to
increase export performance from the District. This involves identifying and
promoting products, which are currently being exported from there, and also
identifying and promoting new products in the district with untapped export
potential. These efforts are to be taken forward through an institutional mechanism to
undertake a baseline study across goods and services, to map current export activities
and the future potential along with the infrastructure and other constraints and
bottlenecks that would need to be addressed to achieve this potential.

The suggestive functions of the District Export Promotion Committee may include:
S.No Functions
1. Prepare a time-bound, detailed District Export Action strategy / plan for
the district to develop as an export hub.

2. Benchmarking baseline export performance of the district, including

pg. 64
 identification of products and services currently exported with export
volumes, destinations etc. and additional products/services with good
promise of targeting export markets.

3. Comprehensive analysis of the strength of each district and the gaps in

product quality/design, production efficiency/competitiveness,
infrastructure, logistics, utilities, enforcement of standards etc. with a
view to identifying interventions to enhance export of existing goods and
services being exported and achieving the potential available for export
of new goods and services.

4. Goods and services being manufactured/produced in the district,

identify the export potential of items available in such districts
(including GI products).

5. Map the existing trade infrastructure available for thrust sector in the
districts.

6. Identify major bottlenecks and challenges hindering export of thrust

sector in the districts. Identify thrust Items/GI Products/Agricultural
items from export perspective for further in-depth analysis.

7. Identifying training and development needs of District industries and

coordination for training with other departments.

8. Dissemination of information through trainings, seminars, guest lectures,

practical training, and exchange visits with other Districts of excellence.

9. Act as one point facilitator for export promotion at District level.

10. Entry of all district level data/ information/progress into the portal
being developed by DGFT and through the portal activate a virtual
engagement/interaction forum for involving and reaching out to all
stakeholders in the district, by enabling/facilitating them to come on
board.

11. Act as a grievance redressal forum for exporters and follow up with the
concerned Central and State agency.
12. Facilitate in organising buyer-seller meets, exhibitions, trade fairs etc. in
the District to encourage the industries to showcase their products to the
world.
13. Implementing the District Export Action Plan in a phased manner to
ensure the District achieves the targeted export growth.

pg. 65
DGFT Regional Authorities will be engaging with State and Central government
agencies to take forward this initiative in each District.

3.05 District Export Action Plans for Each District

The District Export Action Plan may be prepared for each District. It may include the
support required by the local industry and trade in boosting their manufacturing
activity and exports with impetus on supporting the industry from the production
stage to the exporting stage. Informative material on various incentives provided by
the Government of India and the respective State Government of exporters may be
disseminated to the industry and other potential exporters. The Plan may also include
strategy to enhance logistics and infrastructure at the District level and better
utilization of the Market Access Initiative (MAI) Scheme of the Department of
Commerce for inviting foreign buyers under reverse buyer-seller meets at the District
level and suitably gathering District level exports data.

District Export Action Plan may include the following:

S.No. Indicative Content

1. District Profile

2. Industry Profile

3. Comprehensive analysis of the major products (Goods and Services)

with export potential from District.

4. Identifying the bottlenecks faced by the Industry.

5. Identifying institutional responsibilities, specifics of policy,

regulatory and operational reforms.

6. Identifying infrastructure/utilities/logistics/Policy interventions

required.

7. Action Plan must identify quantifiable targets with specific timelines

for their implementation.

8. Clear identification of incentives/Support provided by the State and

Central Government.

9. Training and development needs for identified export

products/services.

pg. 66
 10. Analysis of the export data of the District and ways and means to
effectively capture it.

11. Mid-term and long-term export strategy/suggestions to promote

exports of identified products/services from the district.

3.06 State/UT Export Promotion Committees

To synergise the efforts of the Department of Commerce/DGFT and the State/UT
governments in promotion of exports from the State, each State shall constitute a
State Export Promotion Committee(SEPC) headed by Chief Secretary of the State. The
designated RA of DGFT shall be the co-convener of the committee.
The primary function of the SEPC may be to prepare/monitor State specific Export
Promotion Policy/Strategy, facilitating engagement of exporters with the State
government, address all export promotion issues at the State level and monitor the
progress of DEPCs in each District of the State. The designated RA of DGFT shall
function as a local support to the State government on all matters related to trade and
commerce.

3.07 Nodal DGFT Regional Authority

Districts of the States/UTs have been assigned to the Jurisdictional DGFT Regional
Authority and the nodal RA shall be responsible for the Districts under their
jurisdiction for all activities related to Districts as Export Hubs initiative in those
Districts. Appendix 1A has the list of DGFT Regional Authorities with their District and
State wise Jurisdiction.

3.08 Online Monitoring of District Export Action Plans

DGFT would develop an online monitoring portal that maybe accessed on the DGFT
website to enable the States/ DGFT RAs to upload all information related to the
products/services with export potential of every District. The portal mayalso help in
monitoring the progress of District Export Action Plan in all the Districts. Each DGFT
Jurisdictional RA will be primarily responsible for updating the information/progress
made in implementing Export Action Plan for each District under their Jurisdiction.
The information will also be available in public domain for the benefit of the trade.

3.09 District Outreach Programs

Each Jurisdictional DGFT RA in collaboration with the State and District
administration and concerned agencies/EPCs of Central and State Government shall
prepare a calendar of activities in each District to conduct awareness and training
programs to promote exports from the District. Wide publicity shall be given to these
outreach events to reach every potential exporter in the District.

pg. 67
CHAPTER 4

Duty Exemption /
Remission Schemes
 Chapter-4
Duty Exemption / Remission Schemes

4.01 Policy
Policy relating to Duty Exemption / Remission Schemes is prescribed in Chapter 4 of
Foreign Trade Policy.

4.02 General Provision

(i) Application for grant of Advance Authorisation / Special Advance
Authorisation for export of Articles of Apparel and Clothing Accessories /
Advance Authorisation for Annual Requirement / Duty Free Import
Authorisation (DFIA) shall be filed online (digitally signed) by IEC holder to
the concerned jurisdictional Regional Authority as per Appendix 1A.
Applicant could be either Registered office or Head office or a branch office
or a manufacturing unit of the IEC holder.

(ii) Applicant shall upload documents as prescribed in ANF 4A, if any, at the time
of online filing of application. No physical copy of application is required to
be submitted to Regional Authority.

4.03 Applicant details

Where applicant is a branch office or a manufacturing unit, name of branch office or
manufacturing unit should appear in electronic RCMC and in IEC of the applicant.

4.04 Advance Authorisation

Applicant shall file application online in ANF 4A. Same form is applicable where
Standard Input Output Norms (SION) have been notified or on the basis of adhoc
norms or on self-declaration basis as per paragraph 4.07 of Hand Book of
Procedures.

4.05 Advance Authorisation for items which are otherwise prohibited for
export
(i) Items covered under Chapter 7 and Chapter 15 of ITC (HS) Schedule 2, which
are prohibited for export, may be allowed to be exported under the Advance
Authorisation scheme, unless specifically disallowed. Export shall be allowed
subject to pre-import condition under notified SION/prior fixation of norms
by Norms Committee in terms of paragraph 4.06 of Hand Book of

pg. 69
 Procedures. Import and Export would be permitted only through EDI
enabled ports.

(ii) The Export Obligation Period (EOP) of Advance Authorisations issued for
such items shall be 90 days from the date of clearance of import
consignment and no extension in EOP shall be allowed. Such import shall be
subject to actual user condition and no transfer of imported raw material, for
any purpose, including job work, shall be permitted. In case of non-fulfilment
of EO/ non-achievement of stipulated value addition, a penalty equal to five
times of the CIF value of the imported material, corresponding to the
shortfall in EO, shall be imposed in addition to the applicable duty and
interest. Provisions of Paragraph 4.49 of Handbook of Procedures shall not
be applicable in this case.

(iii) “Wheat Flour (Atta)” is permitted to be exported under the Advance

Authorisation Scheme, subject to pre-import condition of wheat under the
notified SION only. No domestic/ indigenous sourcing of wheat is permitted
and the invalidation letter/ARO facility is not available. Third party exports
are also not allowed in this case. Import and Export would be permitted only
through EDI enabled ports. The Export Obligation Period (EOP) of Advance
Authorisation for wheat shall be 180 days from the date of clearance of each
import consignment and no extension in EOP shall be allowed. Such import
shall be subject to actual user condition and no transfer of imported wheat
for any purpose, including job work, shall be permitted. In case of non-
fulfillment of EO/ non-achievement of stipulated value addition, a penalty
equal to five times of the CIF value of the imported material, corresponding to
the shortfall in EO, shall be imposed in addition to the payment of applicable
duty and interest. Provisions of Paragraph 4.49 of Handbook of Procedures
shall not be applicable in this case.

4.06 Fixation of Norms

(i) In case where norms have not been notified or where applicant wants to get the
ad-hoc norms fixed before making an application for Advance Authorisation,
application in ANF 4B, along with prescribed documents, shall be uploaded online to
concerned Norms Committee (NC) in DGFT headquarters for fixation of SION/Adhoc
norm. Details of Norms Committees along with products groups dealt by each
Norms Committee and respective email addresses for correspondence relating to
norms fixation is as follows:

pg. 70
 Norms For Fixation / Email addresses for
Committees (NC) Revision / communication
in DGFT Amendment of with respective
headquarters normsof Export Norms Committee
Products under
following ITC HS
Chapters
NC-1 81 to 84, 86 to 93 [email protected]

NC-2 72 to 76, 78 to 80, 85 [email protected]

NC-3 29, 30 [email protected]

NC-4 27, 28, 31 to 38, 44 to [email protected]

49, 68 to 71

NC-5 41 to 43, 50 to 67 [email protected]

NC-6 1 to 26, 94 to 98 [email protected]

NC-7 39, 40 [email protected]

(ii) The decisions of Norms Committees shall be available on the website of DGFT
(http://dgft.gov.in) periodically and the applicants shall update themselves the
status of norms fixation in respect of Authorisation obtained by them.

(iii) Exporters / EPC shall provide data to the Norms Committee concerned for the
fixation of SION/Adhoc Norms for an export product. Norms Committee shall
endeavour to fix SION or adhoc norms on receipt of complete data. Any adhoc norm
fixed under this para, on the basis of an application made by an exporter shall be
valid for one authorisation for which such application is made and no repeat
authorisations shall be issued. However, Norms Committee can specify extended
validity period, not more than two years from the date of fixation of such adhoc
norms, for grant of further authorisations under such norm.

(iv) Norms Committees shall also function as recommendatory authority for

notification of SION and DGFT may notify such norms from time to time.

(v) It is mandatory for industry / manufacturers/ EPCs to provide production and

consumption data etc. for the past three years, as may be required by DGFT for
fixation of SION. Otherwise, applicants shall not be allowed to take benefit of
Advance Authorisation scheme for taking repeat Advance Authorisations on self-
pg. 71
 declared basis. Norms Committee may also seek data from DoR (CBIC).

(vi) Experts may be invited from Scientific and Technological institutions as

members of Norms Committee for fixation of Norms.

4.07 Self-Declared Authorisations where SION does not exist

(i) Regional Authority may also issue Advance Authorisation where there is no
SION/valid Ad hoc Norms for an export product or where SION / Ad hoc
norms have been notified / published but exporter intends to use additional
inputs in the manufacturing process, based on self-declaration by applicant.
Wastage so claimed shall be subject to wastage norms as decided by Norms
Committee. The applicant shall submit an undertaking to abide by decision
of Norms Committee. The provisions in this regard are given in paragraph
4.03 and 4.11 of FTP.

(ii) In case of revision / rejection, applicant shall pay duty and interest as
notified by DoR within thirty days from the date of hosting of Norms
Committee decision on DGFT website.

(iii) No Authorisation under this paragraph will be issued by Regional Authority

for items listed in paragraph 4.11 of FTP.

4.07A Self –Ratification Scheme

(i) Policy related to Self-Ratification Scheme is provided at Para 4.06 of FTP.
Applications shall be filed online along with complete details as per
Appendix-4E along with a certificate from Chartered Engineer in Appendix-
4K. For issuance of such a certificate, the Chartered Engineer shall act only
in the domain of his/ her competence.

(ii) General Notes given in the book titled Standard Input Output Norms
including policy for packing material and fuel shall also be applicable to this
scheme in so far as they are not inconsistent with this scheme.

(iii) The applicant shall apply for inputs with specific descriptions along with 8
digit ITC (HS) Classification. Where ever the export product and/or inputs
are given in brand names, the correct chemical /technical name shall also be
given in the application.

(iv) RA may issue Advance Authorisation as applied for subject to the conditions
specified in FTP and HBP. Input Output Norms as applied and wastage
claimed by the applicant shall be treated as final. Ratification of the same by
NC is not required.

(v) Applicant or his supporting manufacturer/co-licensee shall maintain a

proper account of consumption and utilization of duty free imported/
pg. 72
 domestically procured inputs against each authorisation, as prescribed in
Appendix-4H. Application for EODC shall be submitted in prescribed format
along with Appendix-4H to the Regional Authority concerned. Regional
Authority shall compare the details of Appendix-4H, with that of the inputs
allowed in the Authorisation. Such records shall be preserved by the
authorisation holder/manufacturer for a period of three years from the date
of Export Obligation Discharge Certificate.

(vi) Production and consumption records of the export item under this scheme
shall be audited by concerned Norms Committee. Such audit may be
conducted within three years from the date of issue of Authorisation based
on Risk Based Management System (RBMS). Exporters shall be required to
provide necessary facility to verify Books of Accounts or other documents
and assistance as may be required for timely completion of the audit.
Concerned Norms Committee shall constitute the audit teams and specify
the manner of audit from time to time through administrative orders.

(vii) Non submission of prescribed documents/information to the Audit team by

the applicant shall make him liable for penal action under the provisions of
FT(D&R) Act, 1992, as amended and Rules and order made there under. In
case items imported/procured duty-free are found to be in excess or not
consumed fully, the applicant shall suo moto pay immediately duty with
applicable interest to the Customs Authority. However, if Audit team found
that duty-free items were imported in excess and not consumed fully in the
resultant products and duty and interest have not been paid suo moto, the
applicant shall be placed under Denied Entity List (DEL) under Rule 7 of
FT(Regulation) Rules, 1993, as amended, in addition to other penal action
under FT(DR) Act/Customs Act. The Chartered Engineer shall also be liable
for penal action for abetment under the provisions of Section 11(2) of the
FT(DR)Act.

(viii) All the provisions of Advance Authorisation scheme shall also be applicable
to this scheme in so far they are not inconsistent with the specific
provisions of this scheme.

4.08 Cases involving Acetic Anhydride, Ephedrine and Pseudo- ephedrine

as inputs.
(i) Where Acetic Anhydride, Ephedrine and Pseudo- ephedrine is required as an
input for import, applications shall be filed with Regional Authority
concerned. After filing application online, printed copy of such application
shall also be simultaneously endorsed by applicant to (a) Drug Controller of
India, Nirman Bhawan, New Delhi, (b) Narcotics Commissioner, Central
Bureau of Narcotics, Gwalior (c) respective Zonal Director of Narcotics

pg. 73
 Control Bureau. The applicant should declare that they would maintain
prescribed records / documents and also submit prescribed returns to the
relevant authorities, within time as prescribed by law from time to time.

(ii) Regional Authority shall endorse a copy of such Advance Authorisation to

the above three agencies. Regional Authority shall also endorse a condition
that before effecting imports, ‘No Objection Certificate’ shall be obtained
from Drug Controller and Narcotics Commissioner of India.

4.09 Cases requiring Sanitary Import Permit.

(i) Where import of meat and meat products of any kind including fresh, chilled
and frozen meat, tissue or organs of poultry, pig, sheep, goat; egg & egg
powder; milk & milk products; bovine, ovine and caprine embryos, ova or
semen; and pet food products of animal origin has been sought as an input
under Advance Authorisation, the Regional Authority, while issuing Advance
Authorisation shall endorse a condition that before effecting imports of any
of these inputs, Sanitary Import Permit shall be obtained from the
Department of Animal Husbandry, Dairying and Fisheries(DAHDF).

(ii) Regional Authority shall also endorse a copy of authorisation to DAHDF,

Krishi Bhawan, New Delhi.

4.10 Advance Authorisation for applicants with multiple units

(i) Transfer of any duty free material imported or procured against Advance
Authorisation from one unit of a company to another unit for manufacturing
purpose shall be done with prior intimation to jurisdictional Customs
Authority. Benefit of Input Tax Credit shall not be claimed on such
transferred input.

(ii) Imported duty free inputs can be taken from the port / domestic supplier’s
premises to the factory or the premises of the authorisation / co-
authorisation holder or the factory of the supporting manufacturer (whose
name is endorsed in the authorisation or allowed by the Jurisdictional
Customs authority). However, such duty free material imported or procured
against Advance Authorisation can also be taken from the port directly to
the project site of the project authority, subject to furnishing a bond to the
customs authority at the port of import complying with the other provisions
as per Department of Revenue guidelines, if any.

4.11 Advance Authorisation for Free of Cost and Paid Material

Authorisations granted in terms of paragraph 4.19 of FTP, a specific endorsement by
Regional Authority shall be made in the condition sheet of Advance Authorisation,
pg. 74
 disallowing remittances for material being supplied free of cost. All imported inputs
excluding wastage shall be utilised in manufacturing of export product.

4.12 Entitlement

Maximum CIF value of one or more authorisations to be issued under paragraph

4.07 of Handbook of Procedures shall be as under:

(i) For Status Holders – up to 300% of FOB and / or FOR value of preceding
year’s exports and/or supplies.

(ii) Other than Status Holders – upto 300% of FOB or Rs. 10 crore and / or FOR
value of preceding year’s exports and/or supplies, whichever is higher.

(iii) Once adhoc norms are fixed by Norms Committee, value limits mentioned in
sub paragraph (i) and (ii) above, would not be applicable to Advance
Authorisations issued under paragraph 4.07 of Handbook of Procedures.
Value of such authorisations, subsequent to fixation of norms by Norms
Committee, may be enhanced, if the Advance Authorisation was issued
restricting the CIF value to maximum of value in sub-paragraph (i) & (ii)
above.

(iv) In such cases Authorisations shall be issued by Regional Authority

concerned under "Adhoc Norms Fixed" category and application copies
need not be forwarded to NC for fixation / ratification of norms. Where the
application has already been forwarded before the ratification of Norms, the
Regional Authority shall finalise the case as per the norms subsequently
ratified by NC in a similar case of the party.

(v) Authorisation holder in such cases shall be entitled for further authorisation
(s) as per norms ratified by Norms Committee without need for subsequent
ratification by Norms Committee. In such cases the applicant would file
application under “Adhoc Norms Fixed” category to the Regional Authority
concerned.

(vi) Norms ratified by any Norms Committee (NC) in the O/o DGFT on or after
01.04.2023 in respect of any Advance Authorisation obtained under
paragraph 4.07 shall be valid for a period of three years from the date of
ratification. Since all decisions of the Norms Committees are available in the
form of minutes on the DGFT website, all other applicants of Advance
Authorisation are also eligible to apply and get their authorisations based
on such ratified norms on repeat basis during validity of these norms. This
para is not applicable for authorisations applied for items listed under
Appendix 4P.

pg. 75
 (vii) Wherever an applicant has applied for components on “net-to-net basis
with accountability clause” and such cases fall under paragraph 6 of General
Note for all Export Products, the same need not be referred to Norms
Committee for fixation of norms. However, exporters shall indicate clearly
details of such components imported on “net-to-net basis with
accountability clause” in the export/supply documents namely Shipping
Bills, Bill of Exports, Tax invoice for export/supplies prescribed under the
CGST/SGST/UT GST rules evidencing that these imported inputs have been
exported.

4.13 Authorisation in Excess of Entitlement

An applicant shall be entitled for authorisation in excess of entitlement of CIF
mentioned in paragraph 4.12 above subject to furnishing of 100% Bank Guarantee
to Customs authority to cover exemption from customs duties. Regional Authority
shall make a specific endorsement to this effect on authorisation. This provision
shall also apply to Status Holders.

4.14 Application and On-line Inter-Ministerial Consultations for fixation

of norms/adhoc norms
(i) Application filed online by the applicant shall be forwarded electronically to
the concerned Technical / Administrative Ministry / Department /Scientific
and Technological institutions or any other agency by the respective Norms
Committee in the DGFT headquarters within three days.

(ii) The concerned Technical / Administrative Ministry / Department /

Scientific and Technological institutions or any other agency as the case
may be, may communicate its views / comments / recommendations within
45 days electronically/online. In case no comments are received within 90
days, Norms Committee may take a view based on the facts available on
record.

4.15 Undertaking
Applicant shall give an undertaking that he shall abide by norms fixed by Norms
Committee and accordingly take following actions without any demur:

(i) Pay customs duty saved, together with interest as notified by DoR, on excess
inputs as per norms fixed by NC. However, in case Norms Committee allows
lower norms for one, more, or all inputs, authorisation holder will have
option to undertake additional EO in proportion to excess inputs.

(ii) In case application is rejected by Norms Committee, authorisation holder

shall pay duty saved amount along with interest on inputs, as applicable as
pg. 76
 notified by DoR. In cases of domestically procured inputs, the amount to be
paid shall be based on exemptions/refund availed on customs
duty/taxes/cess by the domestic supplier.

(iii) Applicant shall deposit amount as per paragraph 4.49(a)(ii) of HBP in case
the inputs were not freely importable. This amount is in addition to the
amounts in sub-paragraph (i) above.

4.16 Fixation of norms by Norms Committees

(i) All Norms Committees would endeavour for earliest fixation of norms.

(ii) In case application for fixation of adhoc norms / SION is rejected on ground
of non-furnishing of required documents/ information to Norms Committee
or technical authority represented in Norms Committee, authorisation
holder shall be liable to pay customs duty with interest as notified by DoR
and amount as per paragraph 4.49(a)(ii) of HBP. In case SION for the said
product is notified, SION would be made applicable for deciding wastage
norms and Export Obligation.

(iii) In cases where entitlement of the applicant for grant of Advance

Authorisation as per paragraph 4.12 of HBP was lower than the quantity of
input applied by the applicant under Advance Authorisation and export
obligation is completed while fixation of norms by Norms Committee is
pending, entitlement for authorisation as given in paragraph 4.12 of HBP
may be re-credited upon production of documentary evidence (copies of
Shipping bill / bill of export/ Tax invoice for supply prescribed under
CGST/SGST/UT GST rules) showing fulfilment of export obligation in
respect of previous authorisations. However, bond waiver / redemption
shall not be allowed pending fixation of norms in such cases.

4.17 Time limit for Representation

Applicant may file representation against the decision of the Norms Committee
with regard to the fixation of norms within a period of 90 days from the date of
uploading of decision on DGFT website. Representation beyond 90 days shall be
subject to payment of composition fee of Rs. 5000/-. However, no representation
against the decision of Norms Committee after the period of 12 months from the
date of uploading of the decision on DGFT website will be entertained.

4.18 Provision for Pharmaceutical Products

Regional Authority may issue Advance Authorisation for pharmaceutical products
manufactured through Non-Infringing (NI) process. A manufacturer exporter can
avail the benefit of this provision whether the SION or the adhoc norms (under self-

pg. 77
 declared basis in terms of paragraph 4.07 of the Handbook of Procedures) for the
said product is available or not. “Input combination permitted under NI process, as
approved by the concerned agency of the regulated markets”, shall be exporter-
specific and country-specific and shall be available only when the exports are
destined for the same country.

4.19 Processing of Application for Pharmaceutical Products.

(i) An application for grant of an Advance Authorisation under paragraph 4.18
shall be filed online in ANF 4E to concerned Regional Authority along with
the documents uploaded therein.

(ii) Input combination permitted under NI process for manufacturing the

product shall be certified by the Chartered Engineer (Chemical) after due
verification of the details of each input and its quantity as given in
Abbreviated New Drug Application (ANDA) / Drug Master File (DMF) of the
applicant. The Chartered Engineer (Chemical) will certify the details as per
Appendix 4L prescribed in Hand Book of Procedures. Regional Authority
shall cross-verify the requirement of inputs as per the details given in the
application along-with Chartered Engineer Certificate accompanying the
application and issue the authorisation. Regional Authority shall not forward
such application to Norms Committee and the inputs and export product so
allowed by Regional Authority shall be treated as input combinations
permitted under NI Process.

4.20 Redemption of Authorisation issued under paragraph 4.18 of HBP

Provisions contained in paragraph 4.49 of HBP, except sub-paragraph (f), shall be
applicable. Regional Authority shall compare the details of Appendix 4-I, duly
verified and certified by the jurisdictional Customs Authority, or by the Chartered
Engineer (Chemical) along with cross attestation by the Chartered Accountant who
shall both independently verify the inputs consumed in the process, with that of the
inputs made/allowed in the authorisation, before allowing redemption or Bond-
waiver against individual Advance Authorisation issued for pharmaceutical
product(s) manufactured through NI process. As a result of the verification process,
in case, it is found that the authorisation holder has consumed lesser quantity of
inputs than imported, authorisation holder shall be liable to pay customs duty on
unutilized imported material, along with interest thereon as notified by DoR, or
effect additional export within the EO period to account for the export of the
material remaining unutilized. However, for the Customs duty component, the
authorisation holder has also the option to furnish valid duty credit scrip issued
under Chapter 3 of FTP (2015-20).

pg. 78
4.21 Maintenance of Proper Accounts for Authorisations issued under
Para 4.18 of HBP
Every Advance Authorisation holder shall maintain a true and proper account of
consumption and utilization of duty free imported / domestically procured inputs
against each authorisation as prescribed in Appendix 4-I. This record in Appendix
4-I format, duly verified and certified by the jurisdictional Customs Authority, or by
the Chartered Engineer (Chemical) along with cross attestation by the Chartered
Accountant who shall both independently verify the inputs consumed in the
process, shall be submitted to the concerned Regional Authority at the time of
filing application for redemption / bond waiver. Regional Authority shall compare
the details of Appendix 4-I, with that of the inputs allowed in the authorisation,
before allowing redemption or bond waiver against individual authorisation. Such
records shall be preserved for a period of at least three years from the date of
Export Obligation Discharge Certificate.

4.22 Standardisation of Adhoc Norms

(a) For standardization of norms, an application in ANF 4B shall be filed online
along with complete data. Such applications shall be made to concerned
Norms Committee in DGFT headquarters.

(b) Import of fuel may also be allowed with actual user condition under SION by
Norms Committee subject to following:

(i) Facility of import of fuel shall be allowed only to manufacturer having

captive powerplant.

(ii) In cases where SION specifically allows fuel, same shall be permitted
under Advance Authorisation. However, if fuel is not covered
specifically under SION, it may be allowed as per general fuel Policy for
products covered under SION or under paragraph 4.07 above.

(iii) Applications for fixation of fuel entitlement for new sectors and
modification of the existing entitlement as per General Note for Fuel in
Hand Book of Procedures shall be filed online to the Norms Committee
along-with requisite data in ANF 4B.

4.23 Modification of SION

An application for modification of existing SION shall be filed online in ANF 4B to
the concerned Norms Committee in DGFT headquarters.

pg. 79
4.24 Amendment of Export item and inputs
(i) An application for amendment of an export item or input or quantity of
input under SION or under ad-hoc Norms shall be filed online in ANF 4B.

(ii) Applicant would give justification for seeking amendment and Regional
Authority would consider it with specific approval of Head of Office. In case
of any major change in input or request for more wastage to that allowed
under SION or ad-hoc norm, same should be referred to Norms Committee
for ratification.

4.25 Revision of SION by NC

Norms Committee may identify SIONs which in its opinion are required to be
reviewed. Exporters are required to submit revised data in ANF 4B for such
revision. It is mandatory for industry / exporter(s) to provide production and
consumption data etc. as may be required by DGFT / EPC for revision of SION.
Otherwise, applicant shall not be allowed to take benefit of Advance Authorisation
scheme.

4.26 Description of an Advance Authorisation

An Advance Authorisation shall, inter-alia, specify:

(a) Names and description of items including specifications, where applicable,

to be imported and exported/supplied;

(b) Quantity of each item to be imported or wherever quantity cannot be

indicated, value of item shall be indicated. Wherever, quantity and value of
individual inputs is a limiting factor in SION, same shall be applicable;

(c) Aggregate CIF value of imports;

(d) FOB/FOR value and quantity of exports/supplies; and

(e) Validity period of import and Export Obligation Period.

4.27 Exports/Deemed Export supplies in anticipation or subsequent to

issue of an Authorisation.

(a) Exports / Deemed Export supplies made from the date of EDI generated file
number for an Advance Authorisation, may be accepted towards discharge
of EO. Shipping Bills / Tax Invoices should be endorsed with File Number or
Authorisation Number to establish co-relation of exports / Deemed Export
supplies with Authorisation issued. Export/Deemed Export supply
pg. 80
 document(s) should also contain details of exempted materials/inputs
consumed and technical characteristics of export and import items, as the
case may be.

(b) If application is approved, authorisation shall be issued based on input/

output norms in force on the date of receipt of application by Regional
Authority. If in the intervening period (i.e. from date of filing of application
and date of issue of authorisation) the norms get changed, the authorisation
will be issued in proportion to provisional exports / Deemed Export
supplies already made till any amendment in norms is notified. For
remaining exports, Policy / Procedures in force on date of issue of
authorisation shall be applicable.

(c) The export of SCOMET items shall not be permitted against an Authorisation
until and unless the requisite SCOMET Authorisation is obtained by the
applicant.

(d) Inputs with pre-import condition shall not be considered for replenishment
against Exports/Deemed Export supplies made before import of such inputs.

4.28 Exporters Risk

Exports / supplies made in anticipation of grant of an Advance Authorisation shall
be entirely on risk and responsibility of exporter.

4.29 Admissibility of drawback in case of rejection of application

Customs authorities in terms of DoR rules against shipping bills filed and processed
under an Advance Authorisation, in case application for an Advance Authorisation is
rejected or modified by Regional Authority, may permit drawback.

4.30 Advance Authorisation or DFIA for Intermediate Supplies

(a) Application for grant of Advance Authorisation or DFIA for Intermediate
supply may be made on the basis of a tie-up arrangement with an ultimate
exporter (physical/deemed) holding an Advance Authorisation or DFIA.
Regional Authority concerned shall consider such requests.

(b) Advance Authorisation or DFIA for Intermediate supply shall be issued after
making Authorisation of ultimate exporter invalid for direct import of item,
to be supplied by intermediate manufacturer. In such case, a copy of the
invalidation letter will be given to ultimate exporter holding Authorisation
and copy thereof will be sent to intermediate supplier as well as Regional
Authority of intermediate supplier. Intermediate Authorisation holder in
such case has an option either to supply intermediate product to the holder

pg. 81
 of Advance Authorisation (i.e ultimate exporter) or DFIA or to export
(physical / deemed) directly. Intermediate supplier can also supply the
product(s) directly to the port for export by the ultimate exporter (holder of
Advance Authorisation or DFIA). In such cases, shipping bill shall be in the
name of the ultimate exporter with the name of intermediate supplier
endorsed on it.

(c) A suitable documentary evidence indicating the available quantity under

Advance Authorisation shall be submitted along-with the application for
invalidation. The above stated evidence is not required if invalidation is
applied along with the application of Advance Authorisation.

(d) Facility of Advance Authorisation shall be available even in cases where

intermediate supplier has supplied or intend to supply material subsequent
to fulfilment of EO by exporter holding Advance Authorisation / DFIA from
where invalidation letter was issued.

(e) The invalidation letter shall specify the following:

(i) Name, Address and GSTIN of supplier;

(ii) GSTIN & Address of recipient unit of Advance

Authorisation/DFIA holder where inputs would be processed;

(iii) Name, description including specifications, where applicable, and

quantity of items; and

(iv) Individual value of items to be procured.

4.31 Advance Release Order (ARO)

Application shall be filed online in ANF 4A to Regional Authority concerned for
grant of ARO to procure inputs from indigenous sources / STEs. A suitable
documentary evidence as outlined in Para 4.30 (c) of HBP shall be submitted, if
applicable.

4.32 Application of ARO

(a) Application for ARO and ARO shall specify:

(i) Name, Address and GSTIN of supplier;

(ii) GSTIN & Address of recipient unit of Advance Authorisation/DFIA

holder where inputs would be processed;

pg. 82
 (iii) Name, description including specifications, where applicable, and
quantity of items and

(iv) Individual value of items to be procured.

(v) For domestic procurement of steel at export parity price by MSME

exporters of EEPC, (as per Ministry of Steel O.M. No. S- 21016/3/2020-
TRADE-TAX-Part (1) dated 27.05.2020 read with OM dated
24.06.2020 as amended from time to time), the details of Service
Centre/Distributor/Dealer/Stockyard of the domestic steel producer
from where the steel is being procured, duly countersigned by EEPC,
shall also be provided and the same shall be endorsed on the ARO by
the Regional Authority at the time of issue.

(b) An ARO may be issued along with Advance Authorisation / DFIA or

subsequently, and its validity shall be co-terminus with validity of Advance
Authorisation /DFIA.

4.33 Facility of Supporting Manufacturer/Jobber/co-licensee

(a) Imported material may be used in any unit of holder of Advance
Authorisation subject to condition of paragraph 4.10 of this Handbook or
jobber / supporting manufacturer, provided same is endorsed on
authorisation by Regional Authority. If applicant desires to have name of any
manufacturer or jobber added to authorisation, he may apply. Such
endorsement shall be mandatory where prior import before export is a
condition for availing Advance Authorisation scheme and authorisation
holder desires to have material processed through any other manufacturer
or jobber.

(b) Upon such endorsement made by Regional Authority, authorisation holder

and co-authorisation holder shall jointly and severally be liable for
completion of EO. Any one of co-authorisation holders may import goods in
his name or in joint names. BG/LUT shall also be furnished in their joint
names.

(c) If authorisation holder is registered under GST Act, he has an option of

getting names of jobber endorsed by jurisdictional Customs authority as per
CGST/SGST/UT GST Rules in lieu of Regional Authority’s endorsement. In
case manufacturer exporter holding authorisation is not registered / not
required to be registered under GST Act, job work may be allowed after
endorsement of supporting manufacturer’s name in the authorisation from
Regional Authority concerned. However, authorisation holder shall be
solely responsible for imported items and fulfilment of Export Obligation.

pg. 83
4.34 Execution of BG/LUT
(a) Authorisation holder shall execute Bank Guarantee / Legal Undertaking, as
the case maybe, in terms of paragraph 2.29 of Handbook of Procedures.

(b) In case BG / LUT has been redeemed, Advance Authorisation holder can get
duty free inputs processed from any manufacturer under Actual User
condition as per job work regulations prescribed in terms of provisions of
GST Acts under intimation to the Customs authority. However, such
restriction shall not be applicable in case of transferableDFIA holder.

4.35 Port of Registration

(a) Advance Authorisation shall be issued for purpose of import and export
through one of sea ports or airports or ICDs or LCS specified below.
Authorisation holder shall register authorisation at the port specified in
authorisation and thereafter all imports against said authorisation shall be
made only through that port, unless the authorisation holder obtains
permission from customs authority concerned to import through any other
specified port. However, exports may be made through any of the specified
ports.

Sea Ports:

Bedi (including Rozi-Jamnagar), Chennai, Dahej, Dharamtar, Dhamra, Dighi,

Ennore (Tamil Nadu), Gopalpur, Haldia, Hazira(Surat), Jamnagar, Kakinada,
Kandla, Kattupalli Sea Port (Tamil Nadu), Kochi, Kolkata, Krishnapatnam,
Mangalore, Marmagoa, Muldwarka, Mumbai, Mundhra, Nagapattinam,
NhavaSheva, Okha, Paradeep, Pipavav, Porbander, Sikka, Surat (Magdalla),
Tuticorin, Vadinar, Vishakhapatnam.

Air-ports:

Ahmedabad, Bangalore, Bhubaneshwar, Calicut Airport (Kerala), Chennai,

Coimbatore Air Cargo Complex, Dabolim (Goa), Delhi, Hyderabad, Indore,
Jaipur, Kochi, Kolkata, Lucknow (Amausi), Mumbai, Nagpur, Rajasansi
(Amritsar), Srinagar, Trivandrum, Varanasi, Vishakhapatnam.

ICDs:

Agra, Ahmedabad, Anaparthy, Arakkonam (Tamil Nadu), Bangalore,

Babarpur, Bhadohi, Bhatinda, Bhilwara, Bhiwadi, Bhusawal, Chettipalayam
(Tamil Nadu), Chheharata (Amritsar), Coimbatore, Dadri, Delhi, Dighi
(Pune), Dappar, Dera Bassi, Dhannad Rau(District Indore), Daulatabad,
(Wanjarwadi and Maliwada), Durgapur (Export Promotion Industrial Park),
Faridabad, Garhi Harsaru, Guntur, Guwahati (Amingaon), Hyderabad, Irugur
pg. 84
 Village (Tamil Nadu), Jaipur, Jallandhar, Jamshedpur, Jodhpur, Kalinganagar
and Tumb Village (Taluka Umbergaon, District Valsad) Kanpur, Karur,
Kheda ( Pithampur, District Dhar), Kota, Kundli, Loni (District Ghaziabad),
Ludhiana, Madurai, Mallanpur, Mandideep (District Raisen),
Merripalem, Guntur District (AP), Miraj, Moradabad, Nagpur,
Nasik, Pimpri (Pune), Pitampur (Indore), Patli (Gurgaon), Pondicherry,
Raipur, Rewari, Rudrapur (Nainital), Salem, Singanalur, Surajpur, Surat,
Talegoan (District Pune), Thudiyalur (Tamil Nadu), Tirupur, Todiarpet
(TNPM), Tuticorin, Udaipur, Vadodara, Varanasi, Veerapandi (Tamil Nadu),
Waluj (Aurangabad), Hosur (Tamil Nadu) and Nattakkam (Kottayam Taluk
and District)

LCS:

Agartala, Amritsar Rail Cargo, Atari, Chengrabanda, Dawki, Ghojadanga, Hilly,

Jogbani, Mahadipur, Nautanva (Sonauli), Nepalganj Road, Petrapole,
Ranaghat, Raxaul, Singhabad, Sutarkhandi.

SEZ:

As notified by Central Government any SEZ can be a specified port for import
and export.

(b) Commissioner of Customs may permit imports and exports from any other
seaport/airport/ICD or LCS.

(c) For imports from Airport / Seaport / ICD / LCS other than port of
registration, a TRA shall be issued by the customs authority at the port of
registration to customs authority at port of import. However, this
requirement of TRA shall not be required if the port of registration and
port(s) of imports are EDI enabled and the authorisation holder has
registered its authorisation.

(d) For procurement from SEZs, where no TRA is issued by customs, RA may
issue a "Certificate of supplies from SEZ", containing details as given in Para
4.30 (e) for the requested item, after making the import item "Invalid for
direct imports". The "Certificate of supplies from SEZ" shall be marked in
quadruplicate with a copy each to the authorisation holder, SEZ supplier
unit, designated officer at SEZ, and the relevant port customs authorities.
The above certificate shall be issued as an online amendment to the
authorisation and has to be transmitted after verifying usage of issued
authorisation in case it is already registered with customs at the time of
application for the certificate. The application is to be made to the concerned
RA from where authorisation is issued in the manner as prescribed under
Para 4.30(c) and Para 4.34 of this Handbook.
pg. 85
4.36 Facility of Clubbing of Authorisations

(i) No clubbing of Authorisations issued on or before 31st March, 2009 shall be

allowed.

(ii) Request for clubbing shall be made in ANF-4C to the concerned RAwho has
issued the Authorisations.

(iii) Facility of clubbing of Advance Authorisations shall be available only for

redemption / regularisation of such Authorisations and no further import or
export shall be allowed.

(iv) Facility of clubbing shall also be available for Advance Authorisations for
Annual Requirement issued during Foreign Trade Policy period 2009-14,
2015-20, and 2023 wherever exports and imports have taken place as per
Standard Input Output Norms (SION) notified.

(v) Authorisations under which similar duty exemption has been availed shall
only be allowed to be clubbed. Such Authorisations may pertain to different
financial years.

(vi) Only such authorisations shall be clubbed which have been issued within 18
months from the date of issue of earliest authorisation that is sought to be
clubbed, whether such authorisations are valid or not. This is further subject
to condition that upon clubbing only imports made within 30 months from
the date of issue of earliest authorisation shall be considered. Any imports
made beyond 30 months of earliest authorisation shall be regularized under
Para 4.49 of the HBP.

(vii) Exports made during initial or extended EO period of individual

authorisations (after payment of composition fee as per provisions of Para
4.40 of HBP) shall be clubbed.

(viii) Upon clubbing, if shortfall in value or quantity is noticed, the same shall be
regularized under the provisions of Para 4.49 of HBP.

(ix) Clubbing of Authorisations issued with different EO periods shall also be

allowed.

(x) Inputs which are common in all Authorisations shall be clubbed and duty
free inputs shall be accounted for as per SION/Ad-Hoc Norms fixed by NC. In
other words all inputs covered in all Authorisations need not be same.

(xi) Minimum value addition as prescribed in FTP and Procedures for the export
product will be required to be maintained on clubbing.

pg. 86
 (xii) After clubbing, Authorisations shall for all purposes, be deemed to be one
Authorisation. The value addition would be calculated on the basis of total
CIF and total FOB arrived at after clubbing the Authorisations.

(xiii) All cases clubbed, as per earlier provisions would not be reopened.

(xiv) No clubbing shall be permitted in respect of Authorisations where

misrepresentation / fraud have come to the notice of RA. Further, no
clubbing of Authorisations, where EODC/redemption letter has already been
issued or adjudication orders have already been passed by RA/Customs
Authority, shall be permitted.

(xv) Additional provisions for clubbing of Authorisations covered under

Appendix-30A (issued under FTP 2009-14) / Appendix-4J (issued under FTP
2015-20 and FTP 2023) and Authorisations issued with Export Obligation
Period less than 18 months:

(a) Export obligation period of clubbed Authorisations shall be reckoned

from the date of earliest import in any of the Authorisations proposed
to be clubbed.

(b) Clubbing of such Authorisations shall be allowed provided all exports

are completed within initial/extended Export Obligation period
reckoned from date of earliest import in any of the Authorisations
proposed to be clubbed.

4.37 Enhancement/Reduction in the value of Advance Authorisation

(a) In respect of an Advance Authorisation, Regional Authority concerned (as
per their financial powers) may consider a request:

(i) for enhancement / reduction in CIF value of Advance Authorisation;

(ii) Enhancement/ reduction in CIF value, quantity of inputs, FOB value

and quantity of exports of an Advance Authorisation. However, Value
Addition after such enhancement does not fall below minimum Value
Addition stipulated (for the export product) in FTP and HandBook of
Procedures laid there under and there is no change in input-output
norms and FTP under which Advance Authorisation was issued.

(b) Request for pro-rata enhancement in value and quantity may be made
either before or after exports. In such cases where there is a change in SION
prior to export of said product, pro-rata enhancement shall be given after
calculating entitlement on revised SION.

pg. 87
 (c) Application for the enhancement in CIF or FOB value of Authorisation
/reduction in the value of Authorisation / EOP Extension / Revalidation of
Authorisation shall be filed online in ANF 4D to concerned Regional
Authority.

4.38 Application fee for enhancement

Application fee payable for enhancement would be on the difference in CIF values of
original and final Authorisation. However, no application fee would be charged if
value of Authorisation is being reduced or applicant has already paid maximum fee
of Rs 1,00,000 for Advance Authorisation / DFIA.

4.39 Validity period for import and Revalidation of Authorisation

(a) Validity period for import of Advance Authorisation shall be 12 months from
the date of issue of Authorisation.

(b) Validity of Advance Authorisation for supplies under Chapter-7 of FTP shall
be co-terminus with contracted duration of project execution or 12months
from the date of issue of Authorisation, whichever is later.

(c) For Advance Authorisations not covered under Para 4.39(b) above, only one
revalidation for twelve months from expiry date shall be allowed. No further
revalidation would be allowed for such authorisations. Applications for any
such revalidation may be submitted online to the concerned Regional
Authority.

pg. 88
4.40 Export Obligation (EO) Period and its Extension

(a) Period for fulfilment of export obligation under Advance Authorisation

shall be 18 months from the date of issue of Authorisation. Period of EO
fulfilment under an Advance Authorisation shall commence from date
of issue of Authorisation, unless otherwise specified.

(b) In cases of supplies to projects in India under Chapter-7 of FTP or

projects abroad, the Export Obligation period shall be co- terminus
with contracted duration of the project execution or 18 months
whichever is more.

(c) Export Obligation for items falling in categories of defence, military

store, aerospace and nuclear energy shall be 24 months from the date
of issue of authorisation or co-terminus with contracted duration of the
export order whichever is more.
(d) Extension in export obligation period for Authorisations issued under
Appendix-4J shall be allowed for a period not more than the half of the
stipulated export obligation period. In such cases, composition fee shall
be levied in such a manner as prescribed hereunder:

CIF VALUE OF ADVANCE COMPOSITION FEE TO BE LEVIED (In

AUTHORISATION (AA) Rupees)
LICENSES ISSUED

Up to ₹2Crores 5,000
More than ₹2 Crores to 10 10,000
Crores
Above ₹10Crores 15,000

(e) Regional Authority may consider a request of Advance Authorisation

holder for one extension of EO period upto six months from the date of
expiry of EO period subject to the payment of composition fee as
prescribed hereunder:

CIF VALUE OF ADVANCE COMPOSITION FEE TO BE LEVIED

AUTHORISATION (In Rupees)

Up to ₹2Crores 5,000
More than ₹2 Crores to 10 10,000
Crores
Above ₹10Crores 15,000

pg. 89
 Authorisation holder will have to submit a self - declaration to RA
stating that unutilised imported/domestically procured inputs are
available with the applicant.
(f) Request for further extension of six months after first extension as in
(e) above can be considered by Regional Authority, subject to the
payment of composition fee as prescribed hereunder:

CIF VALUE OF ADVANCE COMPOSITION FEE TO BE LEVIED

AUTHORISATION (In Rupees)

Up to ₹2Crores 10,000
More than ₹2 Crores to 10 20,000
Crores
Above ₹10Crores 30,000

No further extension shall be allowed by Regional Authority. However,

only two extensions of six months each as mentioned above can be
allowed subject to payment of composition fee and under no
circumstance Regional Authority shall allow any extension beyond 12
months from date of expiry of EO period. At the time of filing
application for second EO extension, the Authorisation holder will have
to submit a self - declaration to RA stating that unutilised
imported/domestically procured inputs are available with the
applicant.
(g) Whenever a ban / restriction is imposed on export of any product,
export obligation period in respect of Advance Authorisation already
issued prior to imposition of ban, would stand automatically extended
for a period equivalent to the duration of ban, without any composition
fee.

(h) The revised composition fee for EOP extension under para 4.40 of HBP
(2023) will only be applicable for the requests made on or after
01.01.2023. However, existing/pending applications shall be governed
by the earlier provision of HBP (2015-20).

(i) For all Advance Authorisations where the Export Obligation Period is
expiring between 01.02.2020 and 31.07.2020, the Export Obligation
Period stands automatically extended by six months from the date of
expiry. No separate application with composition fee,
amendment/endorsement is required for this purpose. The option to
avail further validity extensions under this para beyond this period
would remain available for these authorisations as per eligibility.

(j) (a) For Advance Authorisations, where original or extended Export

Obligation (EO) period is expiring during the period between
pg. 90
 01.08.2020 and 31.07.2021, the Export Obligation period would be
extended till 31.12.2021 without any composition fees. However this
extension is subject to 5% additional export obligation in value terms
(in free Foreign Exchange) on the balance Export Obligation on the
date of expiry of the original/extended export obligation period.

(b) The option to avail EO extensions with payment of composition fees

under this para (4.40(d), (e) (f)) would remain available for these
authorisations as per eligibility.

(c) In cases where Advance Authorisation Holder has already obtained

EO extension upon the payment of composition fee, the refund of the
composition fee will not be permitted.

(k) For implementation of all PRC decisions involving levy of Composition

Fee while allowing extension in EOP and/or regularisation of exports
already made, the applicable Composition Fee shall be as prescribed
hereunder:

CIF VALUE OF ADVANCE COMPOSITION FEE TO BE LEVIED

AUTHORISATION (IN ₹)

Up to ₹2Crores 25,000
More than ₹2 Crores to 10 50,000
Crores
Above ₹10Crores 100,000

No refund of earlier paid Composition Fee shall be admissible.

4.41 Provisional clearance of export consignment

Customs may allow provisional clearance of export consignment as and when
Authorisation holder produces documentary evidence of having applied for
Export Obligation extension to concerned Regional Authority.

4.42 Re-export of goods imported under Advance Authorisation

Scheme
Goods imported against Advance Authorisation Scheme, which are found
defective or unfit for use, may be re-exported, as per Department of Revenue
guidelines. The authorisation holder has to inform the Regional Authority who
has issued the authorisation before re-export of such defective goods.

4.43 Monitoring of Export Obligation

(a) Regional Authority, with whom undertaking is executed by Advance

pg. 91
 Authorisation holder, shall maintain a proper record in a master
register indicating starting and closing dates of obligation period and
other particulars to monitor EO. In addition, this information may be
generated from Computer System and maintained in a book form.

(b) Within six months from the date of expiry of Export Obligation period,
Authorisation holder shall file application online by linking details of
shipping bills against the authorisation, failing which Regional
Authority may initiate action as per FT (DR) Act by way of issuing
Show-Cause Notice.

(c) In case of online filing of EODC application, Exporters shall link all
exports online on DGFT system by linking file number / authorisation
number with the relevant shipping bill numbers / bill of exports /
invoices in case of deemed exports/Tax invoices for supplies prescribed
under CGST/SGST/UT GST rules.

(d) In case of non EDI shipping bills and supplies under Chapter-7 of FTP,
exporter shall file relevant details manually on the website of the DGFT
within two months from the date of expiry of Export Obligation period.
Copies of shipping bills shall be submitted to Regional Authority
concerned for verification within two months from date of expiry of
export obligation period. In case an applicant is not able to upload any
prescribed document then such documents may be submitted in
physical form to the concerned authority.

(e) e-BRC/ export realisations from RBI's EDPMS wherever available in

DGFT IT system shall be linked with these shipping bills within six
months from the date of expiry of export obligation/realisation or as
per the time period prescribed for realization of foreign exchange by
RBI. Regional Authority shall not take action for non linking/
submission of e-BRC/ export realisations from RBI's EDPMS wherever
available in DGFT IT system before expiry of said period, provided
other documents substantiating fulfilment of Export Obligation have
been furnished by the exporter.

(f) In case Authorisation holder fails to complete Export Obligation or fails

to submit relevant information / documents, Regional Authority shall
enforce condition of Authorisation and Undertaking and also initiate
penal action as per law including refusal of further authorisation to the
defaulting exporter.

4.44 Advance Authorisation for Annual Requirement

(a) Exporters eligible for such Authorisations shall file online application
in ANF 4A to Regional Authority concerned. All provisions applicable to

pg. 92
 Advance Authorisation given above would apply except the following:

(i) Authorisation holder shall have flexibility to export any product

falling under export product group using duty exempted
material.

(ii) Within eligible entitlement, an exporter may apply for one or

more than one authorisation in a licensing year, subject to the
condition that against one Port of registration, not more than five
authorisations can be issued for same product group. One time
enhancement / reduction of the authorisation shall be available.

(iii) On completion of Export Obligation against one or more

authorisations, all issued in same licensing year, entitlement of an
exporter for that licensing year shall be deemed to be revived by
an amount equivalent to Export Obligation completed against
authorisation(s).

(iv) Authorisation for Annual Requirement shall be issued only where

SIONs or valid Adhoc norms exists on the date of issue of
Authorisation. However, no Authorisation for Annual
Requirement shall be issued where input is listed in Appendix-4J.

(b) At the time of clearance of the import consignment against the

authorisation, exporter shall mention technical characteristics, quality
and specifications which shall be endorsed in the Bill of Entry / invoice,
duly attested by the Customs authority, in respect of following inputs:

“Alloy steel including stainless steel, copper alloy, synthetic

rubber, bearings, solvents, perfumes/ essential oils/aromatic
chemicals, surfactants, relevant fabrics and marble.”

4.45 Special Advance Authorisation for export of Articles of Apparel

and Clothing Accessories covered under Chapter 61 and 62 of ITC(HS)
Classification of Export and Import.

(i) Policy relating to Special Advance Authorisation for export of Articles of

Apparel and Clothing Accessories covered under Chapter 61 and 62 of
ITC(HS) Classification of Export and Import is prescribed in Para 4.04A
of Foreign Trade Policy.

(ii) Provisions of Para 4.05, 4.06, 4.07, 4.10, 4.11, 4.12(v)&(vi), 4.21, 4.24,
4.25, 4.26, 4.29, 4.33, 4.34, 4.35, 4.37, 4.38, 4.39, 4.40, 4.41, 4.42, 4.43,
4.46 , 4.47(b), 4.49, 4.50, 4.51 of Handbook of Procedures shall be
applicable to this scheme in so far as they are not inconsistent with this
scheme.
pg. 93
4.46 Fulfilment of Export Obligation
Authorisation holder shall file online application in ANF 4F to Regional
Authority concerned and upload prescribed documents in support of fulfilment
of Export Obligation.

4.47 Redemption/No Bond Certificate

(a) Bond Waiver:

In case Authorisation holder exports first (before effecting imports) by

using imported inputs/indigenously procured inputs, in that case the
Authorisation holder can seek waiver of Bond condition by submitting
evidence of export made and payment realised to that extent. If exports
made are less than the export obligation stipulated in the Authorisation,
request for waiver of bond condition, on pro-rata basis, can also be
considered.
(i) For such a request, an applicant has to file online application
attaching Shipping Bills and e-BRC/ export realisations from RBI's
EDPMS wherever available in DGFT IT system. Scanned copy of
other documents as prescribed in the ANF 4F shall also be
uploaded. In case of deemed exports or export from non-EDI
ports, the documents evidencing proof of export/supply shall
be submitted at the counter of Regional Authority concerned
giving reference of online application in physical form except e-
BRC/ export realisations from RBI's EDPMS wherever available in
DGFT IT system.

(ii) In case Export Obligation has been fulfilled, Regional Authority

shall issue Bond Waiver Certificate (BWC) and forward a copy to
the Customs authority at the port of registration of Authorisation
enclosing details of shipping bill number(s), date(s), FOB value in
Indian Rupees as per shipping bill(s) and description of export
products in respect of shipment taken into account for allowing
waiver of Bond condition. Such bond waiver shall not preclude
the Customs Authority from taking bond in terms of the Customs
notification.

(iii) While allowing waiver of Bond for such exports, Regional

Authority may revalidate the Authorisation in continuation for
further six months for replenishment of inputs consumed in the
production of exported product, from the date of endorsement
provided applicant has made a specific request in ANF 4D and
paid requisite fee for revalidation. It will be further subject to
condition that the applicant had not obtained revalidation earlier
in terms of Para 4.39 (c) of HBP. Maximum period of validity of
the Authorisation including revalidation allowed under this para
pg. 94
 shall not exceed 24 months from the date of issue of
Authorisation.

(iv) Copy of the Bond Waiver Certificate will also be endorsed by the
Regional Authority to the Customs at the Port of Registration
eventually through EDI mode.

(b) Export Obligation Discharge Certificate (EODC):

(i) On completion of exports and imports, the Authorisation holder

shall submit online application in ANF-4F as in (a) (i) above. In
such cases, if Export Obligation has been fulfilled, the Regional
Authority may issue EODC / Redemption Certificate to
Authorisation holder and forward a copy to the Customs authority
at the port of registration of Authorisation indicating the same
details of proof of fulfilment of Export Obligation as stated in
paragraph(a) above evidencing fulfilment of Export Obligation.

(ii) Copy of EODC will also be endorsed by Regional Authority to

Customs at the Port of Registration eventually through EDI mode
thereby obviating the need for further calling of documents and
its examination by concerned Customs Authority.

(c) Ordinarily, redemption of BG / LUT shall not preclude customs

authority from conducting random checks and from taking action
against Authorisation holder for any misrepresentation, mis-
declaration and default detected subsequently as per the Customs Act.

(d) Regional Authority shall take action against Authorisation holder in

case of non-submission of Appendix 4H & 4-I duly filled in, as
stipulated in paragraph 4.51 below or for any misrepresentation, mis-
declaration and default detected subsequently in details declared and
furnished in Appendix 4H & 4-I. An endorsement to this effect shall be
made by Regional Authority in the redemption certificate.

4.48 Transitional Arrangement for Authorisations issued upto

31.03.2023
(a) Advance Licences including Advance Licence for Annual Requirement
issued up to 31.03.2023 shall be governed by respective provisions
contained in Chapter-7 of HBP v1(RE-2001), Chapter 4 of HBP v1
(2002-2007) as Notified on 31.03.2002, Chapter 4 of HBP v1 (2004-
2009) as notified on 31.08.2004 , Chapter 4 of HBP v1 (2009-14) as
notified on 27.08.2009 and Chapter 4 of HBP (2015-20) as notified on
01.04.2015 as amended from time to time, excepting provisions
relating to clubbing and extension in Export Obligation period which

pg. 95
 shall be governed by provisions of paragraphs 4.36 and 4.40
respectively and any other provision, as notified by DGFT.

(b) Wherever Customs duty is to be paid on unutilised material, same shall

be paid along with interest there on as notified by DoR.

4.49 Regularisation of Bonafide Default

Cases of bonafide default in fulfilment of Export Obligation may be regularised
by Regional Authority as under:

(a) If Export Obligation is fulfilled in terms of value, but there is a shortfall

in terms of quantity, the Authorisation holder shall, for regularisation,
pay:

(i) To customs authorities, customs duty on unutilized value of

imported / indigenously procured material along with interest as
notified by DoR. Exporter shall pay Customs Duty along-with
applicable interest online through ICEGATE Payment Gateway.

(ii) An amount equivalent to 10% of the CIF value of unutilised

imported material, if the item of import is restricted, into "Head
Account: 1453, Foreign Trade and Export Promotion and Minor
Head 102". Provisions of this sub paragraph will not be applicable
if unutilized material was freely importable on date of
import/domestic procurement.

(b) If the Export Obligation is fulfilled in quantity but there is shortfall in

value, no penalty shall be imposed if Authorisation holder has achieved
minimum Value Addition prescribed. However, if Value Addition falls
below the minimum Value Addition prescribed, Authorisation holder
shall be required to deposit an amount equal to 3% of shortfall in FOB
value in Indian Rupee, online through DGFT website.

(c) Value wise shortfall shall be calculated with reference to actual

quantity of exports and FOB value of realisation with reference to pro-
rata quantity of imports and CIF value. For example, if export
performance is only 50% quantity wise but import has been for
complete CIF value permitted, then Value Addition would be calculated
on a pro- rata basis, i.e. with reference to 50% of CIF value of imports.
This would, accordingly, imply that where Authorisation holder is
unable to export, no penalty on value wise shortfall shall be imposed.

(d) If Export Obligation is not fulfilled both in terms of quantity and value,
the Authorisation holder shall, for the regularisation, pay as per a), b)
and c) above.

pg. 96
(e) In case an exporter is unable to complete Export Obligation undertaken
in full and he has not made any import under Authorisation,
Authorisation holder will also have an option to get the Authorisation
cancelled and apply for drawback after obtaining permission from
Customs authorities for conversion of shipping bills to Drawback
Shipping Bills.

(f) Regional Authority shall compare relevant portion of Appendix 4H duly

verified and certified by Chartered Accountant / Cost Accountants with
that of norms allowed in Authorisation(s) and actual quantity imported
against Authorisation(s) in the beginning of licensing year for all such
Authorisations redeemed in preceding licensing year. In this
verification process, in case it is found that Authorisation holder has
consumed lesser quantity of inputs than imported, Authorisation
holder shall be liable to pay customs duty on unutilized value of
imported material, along with interest thereon as notified, or affect
additional export within the Export Obligation period.

(g) Regularization of Bona fide default in the cases where Authorisation

was issued for import of drugs from unregistered sources with pre
import condition.

Import of drugs from unregistered sources issued with pre import

condition shall be regularised in the following manner:

(i) The Authorisation holder shall submit documents showing

consumption of full imported quantity as per norms. In case, there
is shortfall in fulfilment of Export Obligation and unutilised
imported quantity remains with the authorisation holder, the
Authorisation holder shall submit a self declaration along with
Charted Accountant’s certificate regarding destruction of the
unutilised duty free imported material accompanied by an
affidavit-cum-indemnity bond indemnifying the Government for
any harm or loss occurring due to diversion of such imported
material from unregistered sources into domestic market that
may be detected in future by any authority , or proof of re-export
of the same to the same supplier in-terms of para 4.42 of HBP.

(ii) Exports made under free shipping bills/under same authorisation

after expiry of Export Obligation period using unutilised quantity
of drugs shall also be accepted in-lieu of submission of destruction
certificate as stated in para(i) above, provided the exact
description and technical characteristics of the drug exported
matches with that of export item described in the Advance
Authorisation. However, the Authorisation holder shall pay
customs duty with applicable interest to the Customs Authority

pg. 97
 on unutilized quantity imported under Advance Authorisation.
The exports made outside Export Obligation period shall only be
considered for waiver of destruction certificate and not for waiver
of liability of applicable duties and interest.

4.50 Payment of Customs Duty and Interest in case of bonafide

default in Export Obligation
(a) Customs duty with interest as notified by DoR to be recovered from
Authorisation holder on account of regularisation or enforcement of
BG/LUT, shall be deposited by Authorisation holder in relevant Head of
Account of Customs Revenue i.e., "Major Head 0037 - Customs and
minor head 001-Import Duties” Online through ICEGATE Payment
Gateway within 30 days of demand raised by Regional / Customs
Authority and documentary evidence shall be produced to this effect to
Regional Authority / Customs Authority immediately. Exporter can
also make suo motu payment of customs duty and interest based on
self/own calculation as per procedure laid down by DoR, which would
be adjusted at the time of closure of the case.
(b) Mode of payment: Online through ICEGATE Payment Gateway

(c) Exporter shall produce documentary evidence of online payment to

Regional Authority along-with duty calculation sheet at the time of
regularization of their case.

(d) Regional Authority shall verify the quantity of excess import before
redeeming the case. Regional Authority may direct license holders to
pay balance amount of customs duty after informing the reasons of the
difference in the liability worked out by Authorisation holder and the
calculations by Regional Authority. In such case, the balance amount of
duty and interest, if any shall be paid by Authorisation holder within
30 days, for regularization of the matter.

(e) The interest shall be paid Online through ICEGATE Payment Gateway
at the rate applicable on the date of payment of delayed duty amount to
the Customs Authority.

(f) On receipt of said documentary evidence from Authorisation holder,

Regional Authority shall redeem the case, and endorse details of duty
paid on the EODC/Redemption Letter and inform details of recovery/
deposits made to the Customs Authority at the port of registration or
the Commissioner of Customs having jurisdiction over the factory of
the Authorisation holder, as the case may be.

(g) Payment of duty, interest and any dues for regularisation shall,
however, be without prejudice to any other action that may be taken by
pg. 98
 Customs Authorities at any stage under Customs Act, 1962.

4.51 Maintenance of Proper Accounts

Every Advance Authorisation holder shall maintain a true and proper account
of consumption and utilisation of duty free imported / domestically procured
goods against each authorisation as prescribed in Appendix 4H or 4I, as
applicable. These records are required to be filed online at the beginning of
each licensing year for all those authorisations, which have been redeemed in
previous licensing year. The same may be submitted on the DGFT Website
under Dashboard----- Repository-----CA/CE Repository.

pg. 99
 DUTY FREE IMPORT AUTHORISATION SCHEME (DFIA)

4.52 Policy
Policy relating to the Duty Free Import Authorisation (DFIA) Scheme is
prescribed in Chapter 4 of FTP.

4.53 Application

(a) Application in ANF 4G along with documents therein, shall be filed

online to concerned Regional Authority.

(b) Provisions of paragraphs 4.26, 4.27, 4.28 & 4.49 (f) of this Handbook of
Procedures shall also be applicable for DFIA Scheme.
(c) After completion of exports and realization of proceeds, request for
issuance of transferable Duty Free Import Authorisation may be made
to concerned Regional Authority within a period of twelve months from
the date of export or six months (or additional time allowed by RBI for
realization) from the date of realization of export proceeds, whichever
is later.

(d) Late cut provisions given in para 11.02 of Handbook of Procedures are
also applicable for DFIA.

4.54 Facility for Split DFIA

Split Authorisations of DFIA subject to a minimum of CIF value of Rs. 10 lakh
each and multiples thereof may also be issued, on request at the time of seeking
transferability. Split-up DFIAs shall be permitted with the same port of
registration as appearing on the original DFIA.

4.55 Re-export of goods imported under DFIA Scheme

(i) Goods imported against transferable DFIA, which are found defective
or unfit for use, may be re-exported, as per Department of Revenue
guidelines. In such cases, if the goods were not put to use after import,
a certificate shall be generated by concerned Commissioner of Customs
to the extent of 95% of CIF value debited against DFIA containing
amount and description of exported goods and the details of original
DFIA.

(ii) Based on the certificate, a fresh DFIA shall be issued by Regional

Authority concerned. Fresh DFIA, so issued, shall have same port of
registration and shall be valid for a period equivalent to balance period
available on date of import of such defective/unfit goods.
pg. 100
4.56 Maintenance of proper accounts of import and its utilisation
Original DFIA holder shall maintain a true and proper account of consumption
and utilisation of duty free imported / domestically procured goods against
each authorisation as prescribed in Appendix 4H. These records are required to
be filed online to Regional Authority concerned along with request for
transferability.

pg. 101
 GEMS AND JEWELLERY SECTOR

4.57 General Provision

Policy relating to Gem Replenishment Authorisation and scheme for gold/
silver/platinum jewellery is given in FTP. Application in respect of export
promotion scheme for gems & jewellery sector shall be made to concerned
Regional Authority as per Appendix 4A.

4.58 Application for Replenishment Authorisation

(a) Application for REP Authorisation shall be filed online in ANF-4H and
upload the documents prescribed therein to concerned Regional
Authority as per Appendix 4A.

(b) Application shall be filed within six months following the month during
which the export proceeds are realised. For export proceeds realised
during a month, consolidated application for entire month shall be filed.

(c) In case E.P Copy of Shipping Bill and Customs attested invoice is
submitted to nominated agencies, exporter shall furnish a self-certified
photo copy of same along with a certificate from nominated agencies
certifying carat / value of studdings in case of studded jewellery.

(d) In cases where payment is received in advance and exports take place
subsequently, application for REP Authorisation shall be filed within six
months following the month during which exports are made.

(e) It is clarified that the month in which the export has been made in case
of advance payment and the month in which export proceeds have been
realised in part or full after making of exports, shall be excluded while
calculating period of six months for filing of application for REP
Authorisation.

4.59 Wastage Norms

Maximum wastage or manufacturing loss on gold/ silver/ platinum jewellery

and articles thereof is as follows:

pg. 102
Sl No Items of export Percentage of wastage by
weight with reference to Gold/
Platinum / Silver content in
export item
Silver
Gold / platinum
Plain jewellery, articles, and
ornaments like Mangalsutra
containinggold and blackbeads 2.5 % 3.2 %
/imitation stones, cubic
a) zirconia diamonds, precious,
semi-precious stones.
Studded jewellery and
b) articles thereof 5.0 % 5.0 %

Mountings and findings

c) manufactured (by non- 2.5 % 3.2 %
mechanised process)
indigenously
Any jewellery/ articles
manufactured by a fully
d) mechanised process and 0.9 % 0.9 %
unstudded. (not applicable
under Advance Authorisation)
Mountings, whether imported
or indigenously
e) procured/manufactured, 1.8 % 1.8 %
used in studded jewellery

Gold / silver / platinum

medallions and coins
f) (excluding coins of nature 0.2% 0.2%
of legal tender)(not applicable
under Advance Authorisation)
Findings and mountings
g) manufactured by 0.9% 0.9%
mechanized process
h) Gold religious idols (only gods Plain Gold idols- 2.5%
and goddess) of 8 carats and Studded Gold idols-5%
above (upto 24 carats)

pg. 103
4.60 Value Addition
Under scheme for export of jewellery, value addition shall be calculated as per
Paragraph 4.37 of FTP. Minimum Value Addition shall be:

Sl Items of export Minimum Value

N Addition
o
a) Plain gold / platinum / silver 3.5%
jewellery and Articles and
ornaments like Mangalsutra
containing gold and black beads /
imitation stones, except in
studded form of jewellery.

b) All types of Studded gold / 6.0% (for those

platinum / silver Jewellery and studded with coloured
articles thereof. Gemstones) and 7.0%
(for those studded with
diamonds).
c) Any jewellery / articles 2%
manufactured by fully
mechanized process (not
applicable under Advance
Authorisation)
d) Gold / silver / platinum 1.5%
medallions & coins (excluding
coins of nature of legal tender)
(not applicable under Advance
Authorisation)
e) Gold / silver / platinum findings / 2.5%
mountings manufactured by
mechanized process

f) Gold religious idols (only gods 10% in case of plain gold

and goddess of 8 carats and above religious idols (Non
(upto 24 carats) studded).
14% in case of plain gold
religious idols studded
with colour gem stones.
15% in case of gold
religious idols studded
with diamonds.

pg. 104
4.61 Entitlement
Entitlement of quantity of gold / silver / platinum against the export of Articles
made out of these metals shall be quantity of gold / silver / platinum in item of
export plus claimed wastage / manufacturing loss within admissible limits. In
the case of Studded Jewellery, the calculation of the quantum of precious metal
shall be done excluding the weight of studding.

4.62 Loss of Gem and Jewellery in transit

Consignments of gem and jewellery items exported out of country and lost in
transit after exports, where foreign exchange against such exports has been
realised or insurance claims settled, will also be eligible for REP Authorisation.

4.63 Gem & Jewellery Replenishment Authorisations

(a) Gem REP Authorisations shall be valid for import of precious stones,
semi-precious and synthetic stones and pearls used in export of Gems
and Jewellery products. In addition, Authorisation shall also be valid for
import of empty jewellery boxes up to 5% of value of Authorisation
within its overall CIF value. Gem REP Authorisations issued against
export of studded gold / silver / platinum jewellery articles, shall also
be valid for import of cut and polished precious / semi- precious stones
other than emerald up to 10% of CIF value of Authorisation within its
overall CIF value.

(b) Gem REP Authorisation will be as per the replenishment rate prescribed
in Appendix 4F and the scale of replenishment on the remaining FOB
value in the case of studded jewellery shall be as given in Appendix-4G.

4.64 Agency Commission

Exporter availing scheme of gold / silver / platinum jewellery are allowed to
pay agency commission subject to the guidelines laid down by RBI. Value
Addition shall be calculated after deducting agency commission.

4.65 Endorsement on Shipping Bill and Invoice

During export of jewellery, shipping bill and invoice presented to customs
authorities shall contain description of item, its purity, weight of gold/ silver/
platinum content, wastage claimed thereon, total weight of gold/ silver/
platinum content plus wastage claimed and its equivalent quantity in terms of
0.995/0.999 fineness for gold / silver and in terms of 0.9999 fineness for
platinum and its value, FOB value of exports and value addition achieved. If
purity of gold/silver/platinum used is same in respect of all or some of items
made out from each of these metals for export, exporter may give total weight
of gold/silver/platinum and other details of such similar items which are of

pg. 105
 same purity. In case of studded items, shipping bill shall also contain
description, weight and value of precious / semi-precious stones / diamonds /
pearls used in manufacture and weight / value of any other precious metal
used for alloying gold/silver

4.66 Conditions of Exports

Exports shall be allowed by customs authorities provided endorsement made
on shipping bill and invoice are correct and value addition achieved is not
below minimum prescribed in FTP.

4.67 Proof of Exports

a) Exporter has to furnish the proof of exports, wherever required for
export of gold / silver / platinum jewellery and articles thereof, by
furnishing following documents:

(i) Self attested copy of Exporter’s copy of the Shipping Bill;

(ii) Tax invoice for export/supplies as prescribed under

CGST/SGST/UT GST rules whose particulars are uploaded on LEO
copy of Shipping Bill

(iii) Bank certificate/e-BRC of realisation in Appendix 2U/ export

realisations from RBI's EDPMS wherever available in DGFT IT
system.

b) In case of personal carriage of jewellery by foreign buyer, following

documents should be submitted by the exporter/seller as proof of
exports for claiming export entitlements:

(i) Copy of shipping bill filed by Indian Seller;

(ii) Copy of Currency Declaration Form filed by Foreign Buyer with
Customs at the time of his arrival; and
(iii) Foreign Exchange Encashment Certificate from Bank.

c) In addition to this, Personal Carriage on Documents against Acceptance

(DA)/Cash On Delivery (COD) basis is also allowed.
Exporter will have to furnish following documents as proof of exports
for claiming export entitlements:

(i) Copy of Shipping Bill filed by Indian Seller; and

(ii) Bank Certificate/e-BRC of Export and Realisation/ export
realisations from RBI's EDPMS wherever available in DGFT IT

pg. 106
 system.

d) Instructions issued by Customs Department in this regard should be

followed mutatis mutandis.

4.68 Conversion of Purity/Fineness

For conversion of quantity of gold/ silver/platinum in terms of equivalent
quantity in terms of fineness, following formula shall be used:

(i) Where items of gold has been exported in terms of carats, quantity of
gold shall be multiplied by number of carat of gold exported, divided
by 24 and thereafter again divided by 0.995/0.999/0.900 to arrive at
equivalent quantity of gold in terms of fineness of 0.995/0.999/0.900
respectively; and

(ii) Wherever purity of item of export is expressed in terms of fineness, the

quantity of gold/silver/platinum shall be multiplied by fineness of
gold/silver/platinum exported and thereafter divided by 0.995 / 0.999
/ 0.900 to arrive at equivalent quantity of gold/ silver/platinum in
terms of 0.995 / 0.999 / 0.900 fineness respectively.

4.69 Release of Gold/Silver/Platinum by Nominated Agencies

Gold / silver / platinum shall be released to exporter of jewellery by nominated
agencies/RBI authorised banks in multiples of 10 gms or in Ten Tola Bars in
respect of gold. However, silver shall be released to exporters in multiples of 1
Kg only. Any balance of gold/ silver/ platinum shall be available to exporter
along with his future entitlement. Gold/ silver shall be released by the
nominated agencies in terms of 0.995 fineness or more and platinum in terms
of 0.900 fineness or more.

4.70 Terms of payment

Export of gold / silver / platinum jewellery and articles thereof shall be against
irrevocable letter of credit, payment of cash on delivery basis, Documents
against Acceptance (DA) basis or advance payment in foreign exchange or
replenishment of gold/silver/platinum content in exported jewellery / articles.

4.71 Port of Export

Exports under schemes of gold /silver/platinum jewellery and articles thereof
shall be allowed by airfreight and Foreign Post Office through the Customs
House at Mumbai, Kolkata, Chennai, Delhi, Jaipur, Bengaluru, Kochi,
Coimbatore, Ahmedabad, Dabolin Airport, Goa, Hyderabad and Surat (Surat

pg. 107
 Hira Bourse). Export by courier shall also be allowed through Custom Houses
at Mumbai, Kolkata, Chennai, Kochi, Coimbatore, Delhi, Jaipur, Bengaluru,
Ahmedabad and Hyderabad upto FOB value of Rs.20 lakh per consignment.

4.72 Export by Post

Policy for export of gems and jewellery parcel by post is in paragraph 4.47 of
FTP. At the time of exports, exporter shall submit following documents:

(i) Shipping bills or Tax invoice for export/supplies as prescribed under

CGST/SGST/UT GST rules presented at foreign Post Office;

(ii) Certificate from nominated agencies indicating price at which gold/

silver/platinum was booked or given on outright sale basis or loan
basis;

(iii) Three copies of Tax invoices for export/supplies as prescribed under

CGST/SGST/UT GST rules.

4.73 Export of Cut & Polished Diamonds for Certification/Grading &

Re- import
Following are authorized laboratories for certification / grading of diamonds
of 0.25 carat and above:

(1) International Gemological Institute (IG)–Hong Kong;

(2) American Gem Society Laboratories (AGS Laboratories),8917
West Sahara Avenue, Las Vegas, Nevada 89117;
(3) Central Gem Laboratory, Miyagi Building, 5-15-14 Ueno Taito- Ku,
Tokyo, Japan;
(4) Diamond Trading Company, Maidenhead, UK;
(5) European Gemological Laboratory(EGL), USA;
(6) Gemological Institute of America (GIA), USA;
(7) Hoge Road Voor Diamond, Antwerp, (HRD);
(8) International Diamond Laboratories DMCC, Dubai;
(9) The Robert Mouawad Campus, International Gemological Institute
(IGI)USA;
(10) World Diamond Centre of Diamonds High
Council, Antwerp, Belgium;
(11) GIA Hong Kong Laboratory Ltd., HongKong;
(12) Gemological Research(Thailand)Co. Ltd., Bangkok;
(13) GIA Education and Laboratory(Pvt)Ltd., Johannesburg;
(14) GIA Education and Laboratory, Goborone(Botswana);
(15) Forevermark NV, Antwerp, Belgium;
(16) International Gemological Institute(IG)–Antwerp, Belgium;
pg. 108
 (17) Gemological Institute of America (GIA), Israel;
(18) Gemological Institute of America (GIA), Japan.

4.74 Import of Diamonds for Certification/Grading & re-export

(a) This facility has been stated in Paragraph 4.41 of FTP. At the time of
imports of diamonds, the bill of entry shall have the detailed
description, including the dimensions / specifications of the diamonds
and at the time of re-export after grading/certification, the Bill of Entry
details should be endorsed in the shipping bill, so far as the dimensions
and other specifications/ details of the diamonds are concerned, so as
to establish a clear correlation between the imported diamonds and
the diamonds being re- exported. In addition, a separate self certificate
shall be attached by GIA (or any other approved agency) along with the
shipping bill at the time of shipment, for matching of the imports to
that of the exports as per the documents and GIA (or any other
approved agency)certificate.

(b) GIA (or any other agency approved in this regard) shall obtain GR
waiver as per the procedure laid down by RBI, in all such cases.

(c) Re-export of the imported diamonds, shall be completed within a

maximum time period of 3 months from the date of import(s). At the
time of import, the agency shall give an undertaking to the customs to
this effect. GIA (or any other agency approved in this regard) shall
furnish a quarterly report to the customs authority at the port of
import by 25th of the month, succeeding the end of the quarterly
period, to ensure that the exports are effected within the stipulated
time period.

4.75 Enlistment /Authorisation of Laboratories for Certification/

Grading of Diamonds of 0.25 carat and above
Applications for enlistment of laboratories should be submitted to Gems and
Jewellery Promotion Council (GJEPC) for scrutiny of the application for
fulfillment of the norms prescribed. GJEPC will forward the application after
verification of bona fides with their clear recommendation for in principle
approval of DGFT. After in principle approval of DGFT is granted, GJEPC will
conduct inspection of the facility to verify the availability of equipments,
technical manpower as well as other infrastructure required for the
Laboratory, to function as Authorised Laboratory for certification/ grading of
diamonds of 0.25 carat and above. Based on the Inspection Report and
recommendations of the GJEPC, the concerned laboratory would be
considered for inclusion in paragraph 4.41 or 4.42 of FTP as the case may be.

pg. 109
4.76 Export against Supply by Foreign Buyer

(a) Before clearance of each consignment of import supplied by foreign

buyer, Nominated Agency / Status Holder having Nominated Agency
Certificate/Eligible Exporter shall execute a bond with Customs,
undertaking to export within stipulated period in contract,
gold/silver/platinum jewellery or articles equivalent to entire import
quantity of gold/silver/platinum, mountings and findings etc excluding
admissible wastage.

(b) In case of direct supply of gold/silver/platinum, alloys, findings and

mountings of gold/silver/platinum and plain semi-finished
gold/silver/platinum jewellery to status holder/ exporter, Status
Holder/exporter shall furnish a Bank Guarantee/LUT, as per Customs
Rules and regulations to Customs equivalent to Basic Customs Duty
leviable on imported gold/ silver/ platinum, alloys, findings and
mountings of gold/ silver/ platinum and plain semi- finished gold/
silver/ platinum jewellery etc. Integrated Goods and Services tax and
Compensation Cess leviable under Section 3(7) AND 3(9) of Customs
Tariff Act shall be payable separately on imports.

(c) BG /LUT, executed with Customs shall be valid for one year. In case of
direct supply to Status Holder/exporter, exports shall be completed
within 90 days. In case of non-fulfillment of EO / non- achievement of
stipulated value addition, Customs Authority shall proceed to recover
custom duty along-with interest as notified by DoR which may include
enforcement of BG/LUT. Besides, importer will be liable to penal action
under Customs Act.

4.77 Export Procedure/Payment of Customs Duty

(a) Nominated Agency / exporter shall be liable to pay customs duty
leviable on that quantity for which export obligation is not discharged
within due date.

(b) Goods shall be cleared through Customs by Nominated Agency /

exporter. Even where export order is received by an Associate, goods
shall be cleared through Customs by nominated agency only and not by
Associate. Associate shall, in such cases, authorise Nominated Agency to
act as its agent to file Bill of Entry and Shipping Bill.

(c) At the time of export, shipping bill presented to Customs shall also
contain the following:

(i) Name and address of associate /exporter;

pg. 110
 (ii) An endorsement by Nominated Agency that export is made
against an order received by concerned associate, its date of
registration with nominated agency. In case of exports by
exporter, a self declaration shall be provided to this effect;

(iii) Name of Customs House through which gold/ silver/

platinum/plain semi-finished gold/ silver/ platinum jewellery
was imported and corresponding Bill of Entry No. and date and
date of import.

(d) Each shipping bill shall be valid for exports only through Customs
House located at the place where office of Nominated Agency /
exporter concerned is situated. It shall be valid for shipment for a
period of seven days including the date on which endorsement was
made by nominated agency in case of exports through nominated
agency. If exports cannot be made within this period, exporter shall file
a fresh shipping bill.

(e) At the time of export, exporter shall submit following documents:

(i) Shipping bill with two extra copies where exports are made from
a Customs House other than Customs House through which
corresponding import of gold/ silver/ platinum/plain semi-
finished gold/silver/ platinum jewellery was effected. In other
cases, shipping bill with an extra copy;

(ii) Three copies of tax invoices for export/ supplies as prescribed

under CGST/SGST/UT GST rules;

(iii) Certificate from nominated agency indicating quantity and value

of items supplied by foreign buyer.

(f) Customs authorities shall return two copies of shipping bill and
connected invoice duly attested. One copy shall be sent to person who
presented documents and the other copy shall be sent by Customs to
office of nominated agency /exporter.

(g) In case of exports through nominated agency, exporter shall submit

proof of exports to nominated agency within 15 days of exports, who
shall, after verifying documents, release admissible quantity of the
gold/ silver/ platinum etc. to exporter.

(h) Exporter may also obtain, in advance, gold/ silver/ platinum etc.
supplied by foreign buyer by furnishing a BG /LUT for an amount equal
pg. 111
 to international price of such items plus customs duty payable thereon.
Integrated Goods and Services tax and Compensation Cess leviable
under Section 3(7) AND 3(9) of Customs Tariff Act shall be payable
separately on imports. BG /LUT shall be redeemed only when the
exporter has furnished proof of exports to nominated agency and
accounted for the use of items supplied in advance in export product.

(i) For redemption of bond/ BG /LUT executed with Customs, Nominated

Agency /exporter shall furnish a statement indicating items, its
quantity and value supplied by foreign buyer, corresponding Bill of
Entry number and date, number of each of shipping bills against which
corresponding exports was made.

4.78 Maintenance of Accounts

Nominated Agency shall maintain complete account, consignment-wise, of the
gold, silver, platinum, mountings, findings/ plain semi-finished gold/silver/
platinum jewellery etc. imported for execution of each export order, exports
effected and quantity of gold, silver, platinum mountings, findings etc. released
against such exports. Such accounts shall be maintained for a minimum period
of three years from date of exports.

4.79 Export through Exhibitions/Export Promotion Tours/ Export of

Branded Jewellery
(a) Nominated Agencies shall produce to Customs Authorities letter in
original or its certified copy, containing Government’s approval for
holding exhibition/export of branded jewellery. Any other person shall
produce to the Asst. Commissioner, customs letter in original or its
certified copy containing GJEPC’s approval for holding exhibitions/
export promotion tour/export of branded jewellery.

(b) In case of re-import, such items, on arrival, shall be verified along with
export documents before clearance.

(c) Exports under this scheme shall be subject to following conditions for
following modes of export:

(i) Export of Gems and Jewellery for holding/participating in

overseas exhibition.

(a) Items not sold abroad shall be re- imported within 60 days of
close of exhibition. However in case exporter is participating in
more than one exhibition within 45 days of close of first
exhibition, then 60 days shall be counted from date of close of

pg. 112
 last exhibition. In case of exhibition in USA, the time period
shall be 90 days instead of 60 days mentioned above. In case of
personal carriage of gems and jewellery for holding
/participating in overseas exhibitions, value of such gems and
jewellery shall not exceed US $ 5 million. Gold/ silver/
platinum content on items sold in such exhibitions may be
imported as replenishment.

(b) Exporter shall take replenishment from nominated agency

within 120 days from the close of the exhibition gold /silver /
platinum for replenishment content against items sold abroad
in exhibition.

(d) Personal Carriage of gems & jewellery or export through

airfreight/post parcel route for Export Promotion Tours/photo
shoots/fashion shows overseas. Personal carriage/export through
airfreight/post parcel route of gold/silver/ platinum jewellery, cut and
polished diamonds, precious, semi-precious stones, beads and articles
as samples upto US $ 1 Million for export promotion tours/photo
shoots/fashion shows and temporary display/ sale abroad is also
permitted with approval of Gem & Jewellery EPC subject to the
condition that promoter would bring back jewellery / goods or
repatriate sale proceeds within 45 days from date of departure through
normal banking channel. In case of personal carriage for export
promotion tours, exporter shall declare personal carriage of such
samples to Customs while leaving country and obtain necessary
endorsement on Export Certificate issued by Jewellery Appraiser of
Customs. In such cases exporter shall book with nominated agency,
within 120 days after export promotion tour or expiry of stipulated
period of 45 days, whichever is earlier, gold/silver/ platinum for
replenishment content against items sold abroad.

(e) Export of branded jewellery.

(i) Export of branded jewellery is also permitted with approval of

Gem & Jewellery EPC for display/sale in permitted shops setup
abroad or in showroom of their distributors/ agents. Items not
sold abroad within 365 days shall be re-imported. Exporter shall
book with nominated agency within 120 days after the end of
stipulated period of 365 days, gold/silver/platinum for
replenishment content against items sold abroad.

(ii) Following documents shall be submitted for claiming such

replenishment:

pg. 113
 (a) LEO copy of Shipping Bill with Tax invoice for export
supplies;
(b) Copy of the approval letter issued by Government/GJEPC;
(c) Certificate from Nominated Agency / GJEPC as in Appendix
4-O. In case of exhibitions organised by nominated agencies,
gold/silver/ platinum shall be imported as replenishment by
nominated agencies within 60 days from close of exhibition.

(f) Nominated Agencies shall maintain a complete account of exports

made, goods sold abroad, goods re-imported, and metals purchased
abroad and imported into India. Such account shall be maintained for a
minimum period of three years from date of close of exhibition.

4.80 Export against supply by Nominated Agencies

Exporter may obtain gold/silver/ platinum on following basis:
(i) Replenishment basis after completion of exports;
(ii) Outright purchase basis in advance;
(iii) Loan basis.

4.81 Replenishment Basis

(a) Exporter may apply to Nominated Agency for booking of precious
metal gold/silver/platinum. Quantity of precious metal booked with
nominated agency shall be equivalent to precious metal content in the
export product and admissible wastage.

(b) Applicant shall at the time of booking deposit an earnest money for a
minimum amount of 20% of notional price of precious metal, which
shall be adjusted at actual sale. Exports shall be effected within a
period of 120 days from date of booking and drawal of precious metal
shall be completed within a period of 150 days from date of booking or
within 30 days from date of export whichever is later.

(c) Exporter may also export jewellery on a notional rate based on

certificate provided by Bank. Exporter must fix price within credit
terms allowed to buyer and realise proceeds within the due date of the
credit terms or 180 days, whichever is earlier. Exporter exporting on a
notional basis under Replenishment Scheme must book the same
quantity of gold with Nominated Agency on same rate that he may have
booked with buyer. Nominated agencies shall purchase precious metal
on behalf of exporter at the rate so fixed and thereafter issue a
purchase certificate bearing a serial number to exporter indicating
quantity of gold/silver/platinum and CIF value, in dollars including the
Rupee equivalent. Price shall be actual price at which

pg. 114
 gold/silver/platinum is purchased by nominated agencies plus
permitted service charges levied by nominated agencies shall be
included with the price of gold/ silver/ platinum for value addition.
Duplicate and triplicate copies of exporter’s application together with
copies of purchase certificate for exporter shall be sent by nominated
agencies to concerned Custom House as well as to the negotiating bank
who will confirm realization at which gold has been purchased.
Exporter exporting under notional rate will get replenishment only
after proceeds are realised.

4.82 Outright Purchase Basis in Advance

(a) Exporter may obtain required quantity of precious metal in advance on
outright purchase basis subject to furnishing of BG/LUT to nominated
agencies for an amount as may be prescribed by nominated agency. On
failure to effect exports within period prescribed, the nominated
agencies shall enforce BG / LUT, as the case may be.

(b) Exports shall be effected within a maximum period of 90 days from

date of outright purchase of precious metal.

4.83 Loan Basis

(a) Exporter may obtain required quantity of precious metal on loan basis
subject to furnishing of BG / LUT, for customs duty to nominated
agencies for an amount as may be prescribed by nominated agencies.
Integrated Goods and Services tax and Compensation Cess leviable
under Section 3(7) AND 3(9) of Customs Tariff Act shall be payable
separately on imports. On failure to effect exports within the period
prescribed, the nominated agencies shall enforce the BG /LUT.

(b) Exporter has to pay interest as notified by DoR on gold taken on loan
basis at the rate as may be specified.

(c) Export has to be completed within a maximum period of 90 days from

date of release of gold on loan basis. No extension for fulfilment of EO
shall be allowed.

(d) (i) Exporter shall be permitted to export jewellery on the basis of a

notional rate certificate to be issued by nominated agency/ GJEPC.
This rate will be based on prevailing Gold /US$ rate and the
US$/INR rate in notional rate certificate. Certificate issued by
nominatedagency/GJEPC should not be older than 7 working days
of date of shipment.

pg. 115
 (ii) VA will have to be achieved on rate as may be got fixed with buyer
and Nominated Agency.

(iii) Exporter shall have flexibility to fix the price and repay Gold Loan
within 180 days from date of export. This price shall be
communicated to nominated agencies who will issue a certificate
showing final confirmation of the rate to the bank negotiating
documents, to ensure export proceeds are realized at this rate.

(e) Nominated agencies may accept payment in dollars towards cost of

import of precious metal from EEFC account of exporter.

4.84 Exports against Advance Authorisation

(a) Procedure applicable to Advance Authorisations under Chapter 4 of
Hand Book of Procedures shall generally apply to this scheme except
norms for value addition, Export Obligation period and regularization
of default. Value addition for Gems and Jewellery items shall be as per
paragraph 4.60 of this Handbook of Procedures.

(b) Export Obligation will be required to be fulfilled within 120 days from
date of import of each consignment against Authorisation. However,
Export Obligation period shall be 180 days from date of import of
findings, mountings made of gold, platinum and silver and export of
jewellery. No further extension in Export Obligation period will be
allowed. Advance Authorisation holder may also import gold as
replenishment after completion of exports.

(c) Advance Authorisation holder may obtain gold /silver / platinum from
nominated agencies in lieu of direct imports. In such a case, Export
Obligation will be required to be fulfilled within 90 days from date of
supply of Gold/Silver/Platinum by nominated agency and the
nominated agency shall also make, both exchange control copy and
customs purpose copy of Authorisation invalid for direct imports.

4.84 A
For those cases, where the last date for exports/ replenishment/ imports/
drawal of precious metal as calculated under various sub-paras of para 4.82,
4.83, 4.84 and Para 4.85, expires between 01.02.2020 and 31.07.2020, such
last date stands extended by six months. However, relaxation in the period for
repatriation/forex realization would be equal to the period as allowed plus six
months, or as per RBI guidelines, whichever is less.

pg. 116
4.84 B
For those cases, where the last date for exports/ replenishment/ imports/
drawal of precious metal as calculated under various sub-paras of para 4.82,
4.83, 4.84 of Handbook of Procedures, 2015-20 expires between 01.02.2021
and 30.06.2021, such last date stands extended by six months. However,
relaxation in the period for repatriation/forex realization would be equal to
the period as allowed plus six months, or as per RBI guidelines, whichever is
less.

4.85 Regularistion of Bonafide Default

Cases of bonafide default in fulfillment of Export Obligation by an exporter
who has obtained precious metals from nominated agencies may be
regularised provided exporter has paid customs duty along-with interest
thereon as notified by DoR. Exporter will have the option to pay customs duty
through valid duty credit scrips issued under FTP. The interest / penalty shall
be required to be paid in cash. In case of Advance Authorisation, the
provisions as given in paragraph 4.49 above shall apply. This shall be without
prejudice to any action that may be taken against exporter under FT(D&R)
Act, Order or Rules issued hereunder as amended from time to time.

4.86 Replenishment Authorisation for Import of Consumables etc.

Application for import of consumables etc., as given in paragraph 4.35 of FTP
shall be filed online to the concerned Regional Authority in ANF 4H.

4.87 Personal Carriage of Gems & Jewellery Export Parcels

(a) Personal Carriage of gems & jewellery parcels by Foreign Bound
Passengers from all EOU/SEZ units and all firms in DTA through
Airports in Delhi, Mumbai, Kolkata, Chennai, Kochi, Coimbatore,
Bangalore, Hyderabad, and Jaipur is permitted. Procedure for Personal
Carriage of exports shall be as prescribed by Customs. Export proceeds
shall, however, be realised through normal banking channel.

(b) For claiming Replenishment in case of Personal Carriage of Exports by

Foreign Bound passenger, documents shall be same as mentioned
under paragraph 4.81(c) of HBP. Authorised Courier Companies are
also permitted to operate on the above lines.

4.88 Personal Carriage of Gems & Jewellery Import Parcels

Personal carriage of gems & jewellery import parcels by an Indian
importer/Foreign National may be permitted into all EOUs/SEZ units and all
firms in DTA through airports in Delhi, Mumbai, Kolkata, Chennai, Bangalore,
Hyderabad, and Jaipur. Procedure will be same as for import of goods by air-
pg. 117
 freight except that parcels shall be brought to Customs by Importer / Foreign
National for examination and release. Clearance of imports under this scheme
shall be as per normal customs clearance procedure.

4.89 Duty free import of samples

Duty free import of gems and jewellery samples upto Rs 3 lakh or 0.25% of the
average of last three years export turnover of gems and jewellery items,
whichever is lower, shall be allowed in a financial year as per Customs
notification.

4.90 Re-import of rejected jewellery

An exporter of plain/ studded precious metal jewellery shall be allowed to re-
import duty free jewellery rejected and returned by buyer up to 2% of FOB
value of exports in preceding licencing year (based on CA certified copy of
export of preceding year) with refund of any duty
exemption/refund/replenishment benefit availed on inputs used as per
customs rules and regulations.

4.91 Diamond & Jewellery Dollar Accounts

Policy for Diamond and Jewellery Dollar Accounts is given in paragraph 4.50
of FTP. Its operation will be governed by procedure specified by the RBI.

4.92 Export and import of Diamond, Gemstone & Jewellery on

consignment basis
(a) Policy for export and import of diamond, gem stone and jewellery on
consignment basis is given in paragraph 4.53 of FTP.

(b) Detailed procedure in this regard shall be governed as per the relevant
Customs Rules & Regulations. Re-import of these items (either in
complete or partial lot) exported on consignment basis shall be subject
to condition that exporter follows prescribed provisions of relevant
customs notification to establish that goods are the same which were
exported.

4.93 Guidelines/ Monitoring for import of precious metal by the

Nominated Agencies
The guidelines on import of precious metal by the nominated agencies and
monitoring are as under:

(a) Following guidelines for monitoring the import of precious metal and

pg. 118
its distribution and / or own use by the Nominated Agencies will be
followed, (other than the Banks nominated by RBI for this purpose):

(i) Every Nominated Agency is required to maintain records of

imports of precious metal (both quantity and value) and its
distribution for the purpose of exports of value added product as
well as for the purpose of domestic consumption as per the
format given in Appendix 4-M of Hand Book of Procedures.
Nominated Agencies will also have to follow the guidelines/
rules/procedures /directions as prescribed by RBI and DGFT.
Failure to comply will render Nominated Agency Certificate liable
to be cancelled in addition to action under FT (DR) Act 1992, as
amended, after affording opportunity of personal hearing.

(ii) Monitoring by Gems & Jewellery Export Promotion Council:

Monitoring in respect of Nominated Agencies Handicraft and

Handlooms Exports Corporation Ltd, MSTC Ltd, Diamond India
Limited will be by Gems & Jewellery Export Promotion Council
(G&J EPC). Nominated Agencies shall file half yearly return as per
format given in Appendix 4-M of Hand Book of Procedures, to the
Gems & Jewellery Export Promotion Council (GJEPC), Mumbai
within 15 days of every completed half year. In turn, G&J EPC shall
compile the half yearly return and the figures submitted by the
Nominated Agency and check the performance of the Nominated
Agency. Thereafter, GJEPC shall forward the compiled half yearly
returns along with its observation on performance of Nominated
Agency to DGFT headquarters within one month of every
completed half year. In case of delay in filing or non-submission of
half yearly return within 15 days of every completed half year,
GJEPC shall seek comments of defaulting Nominated Agencies.
GJEPC will also forward the particulars of defaulting Nominated
Agency to DGFT headquarters for taking appropriate action
against defaulting Nominated Agency.

pg. 119
CHAPTER 5

Export Promotion
Capital Goods
(EPCG) Scheme
Chapter-5
Export Promotion Capital Goods (EPCG) Scheme

5.01 Policy
Policy relating to EPCG Scheme is given in Chapter 5 of FTP

5.02 Application Form

An application for grant of an authorisation may be made by Registered Office or
Head Office or a Branch Office or Manufacturing Unit of an eligible exporter to RA
concerned in ANF 5A along with documents prescribed therein.

5.03 Nexus Certification

(a) RA concerned shall, on the basis of nexus certificate from an independent
Chartered Engineer (CEC) submitted by the applicant in Appendix 5A,
issue EPCG authorisation. For issuance of such certificate, the Chartered
Engineer shall act only in the domain of his/her competence. In case of
fabrication, reasonable wastage, if any, anticipated at the time of
installation of capital goods shall be certified by the Chartered Engineer in
the nexus certificate and the same would be mentioned in the condition
sheet of the EPCG authorisation at the time of issue. The wastage so
permitted at the time of issuance of authorisation would be allowed to be
sold as scrap/waste on payment of applicable duty by the authorisation
holder.
(b) An application for amendment in the list of import item(s) including
addition(s)/deletion(s), if any, may be filed with RA concerned provided
the authorisation is valid for import. The applicant would give justification
for seeking such amendment(s) along with fresh nexus certificate from an
independent Chartered Engineer.
(c) An application for amendment in the list of export item(s) including
addition(s)/deletion(s) if any, may be filed with RA concerned provided
the Export Obligation period of the authorisation is valid and the CG has
nexus with export product. The applicant would give justification for
seeking such amendment(s) along with fresh nexus certificate from an
independent Chartered Engineer.

5.04 Certificate of Installation of Capital Goods

(a) Authorisation holder shall produce, within six months from date of
completion of import, to the concerned RA, a certificate from the
jurisdictional Customs authority or an independent Chartered Engineer, at

pg. 121
 the option of the authorisation holder, confirming installation of capital
goods at factory/premises of authorisation holder or his supporting
manufacturer(s). The RA may allow one time extension of the said period
for producing the certificate by a maximum period of 12 months with a
composition fee of Rs. 5000/-. Where the authorisation holder opts for
independent Chartered Engineer’s certificate, he shall send a copy of the
certificate to the jurisdictional Customs Authority for intimation/record.
The authorisation holder shall be permitted to shift capital goods during
the entire export obligation period to other units mentioned in the IEC and
RCMC of the authorisation holder subject to production of fresh
installation certificate to the RA concerned within six months of the
shifting.
(b) In the case of import of spares, the installation certificate shall be
submitted by the Authorisation holder within a period of three years from
the date of import.

5.05 Port of Registration

EPCG Authorisation shall be issued with a single port of registration as per
paragraph 4.35 of HBP, for imports. However, exports can be made from any port
specified in paragraph 4.35 of HBP.

5.06 Import of spares, tools, refractories and catalysts

(a) Applications for procurement of capital goods covered under sub-
paragraphs (a) (iii) and (iv) of paragraph 5.01 of FTP shall contain a list of
plant/machinery installed in factory/premises of the applicant for which
such capital goods are required, duly certified by independent Chartered
Engineer or jurisdictional Customs Authorities.
(b) In case of import of spares, EPCG authorisation shall not specify list of
spares but shall indicate:
(i) Name of plant /machinery for which spares are required.
(ii) Value of duty saved allowed under the authorisation.
(iii) Description of product to be exported and value of export
obligation.
(c) Authorisation holder shall maintain a register of stock & utilisation of
capital goods covered under sub-paragraphs (a)(iii) and (iv) of paragraph
5.01 of FTP imported under the scheme and at the time of application for
EODC, authorisation holder shall submit certificate from independent
Chartered Engineer confirming their use in the installed capital goods on
the basis of such register.

pg. 122
5.07 Conversion of EOU/Relocated SEZ Units to DTA Unit under EPCG
Scheme
(a) An EOU/a relocated SEZ unit, while converting to a DTA Unit, may apply
for an EPCG authorisation along with documents prescribed. ‘No Objection
Certificate’ should be produced from the concerned Development
Commissioner.
(b) The export obligation period for a unit which converts from EOU/SEZ
Scheme to EPCG Scheme would be the same as is available to a direct EPCG
Authorisation holder as per paragraph 5.01 of FTP.
(c) If a standalone EOU / SEZ unit wishes to de-bond from EOU to EPCG
Scheme, there shall be no requirement for maintenance of average export
obligation and the unit shall be required to maintain only specific export
obligation equivalent to six times of the proportionate duty saved amount
of the depreciated value of capital goods for which the Authorisation has
been obtained.
(d) In case one unit of a firm / company opts to de-bond from EOU to EPCG
Scheme, while other unit(s) are DTA units, then the average export
obligation in respect of the authorisations issued to the firm / company
(other than de-bonding unit) shall remain unchanged and the average EO,
after de-bonding of the unit, shall be fixed by excluding the exports made
by the de-bonded unit from the total exports of the firm/ company, which
runs concurrently for all the units of the firm/ company. In such a case,
specific EO equivalent to six times of the proportionate duty saved amount
on the depreciated value of the Capital Goods would be imposed on the de-
bonding unit shifting to the EPCG Scheme.

5.08 Procurement from SEZ

(a) If the request is made along with the application for authorisation for
procurement of new Capital goods from SEZs, the RA may issue a
"Certificate of supplies from SEZ", containing the details for the requested
items after making the import item "Invalid for direct imports”. The
"Certificate of supplies from SEZ" shall contain the following details:

(i) Name, Address and GSTIN of SEZ unit;

(ii) GSTIN & Address of recipient unit of EPCG authorisation holder

where capital goods would be installed;
(iii) Name, description including specifications, where applicable,
and quantity of items; and
(iv) Individual value of items to be procured.

pg. 123
(b) The said “Certificate of supplies from SEZ" shall be marked in
quadruplicate with a copy each to the authorisation holder, SEZ supplier
unit, designated officer at SEZ and the relevant port customs authorities.
The above certificate shall be issued as an online amendment to the
authorisation and has to be transmitted.
(c) In cases where the request for issue of "Certificate of supplies from SEZ" is
made in due course, it shall be accompanied with an authorisation
utilization status issued by the relevant Customs authorities mentioned on
the authorisation for the RA to verify the actual utilization of authorisation
at the time of application. The certificate may be issued to the extent of
quantity available as per utilization status. In case the request for
"Certificate of supplies from SEZ" is made along with the application for
authorisation, the same procedure shall apply.

5.09 Sourcing of Capital Goods Manufactured Indigenously

(a) EPCG authorisation holder intending to source capital goods manufactured
indigenously shall make a request to the RA for issuance of Invalidation
Letter or Advance Release Order (ARO).
(b) Deemed export benefits as given in paragraph 7.03 of FTP shall be
available.
(c) This request can be made either along with application or during the
validity period of EPCG Authorisation.
(d) Applicant shall give the name and address of the manufacturer(s) of
capital goods.
(e) RA concerned will issue the invalidation letter/ARO, in quadruplicate.
(f) Validity period of invalidation letter/ARO shall be co-terminous with the
validity period of EPCG authorisation.

5.10 Conditions for fulfillment of Export Obligation

In addition to conditions in paragraph 5.04 of FTP, the following conditions shall
also be applicable for fulfillment of export obligation:
(a) Name of the supporting manufacturer as well as the exporter shall
be indicated on export documents.
(b) In case the Authorisation holder wants to export through a third
party, export documents viz., shipping bills/Bill of exports etc. shall
indicate name of both authorisation holder and supporting
manufacturer, if any, along with EPCG authorisation number.
Shipping bill/Bill of Export, GST invoice and e-BRC/ export
realisation from RBI’s EDPMS should be in the name of third party
exporter. The goods exported through third party should be
manufactured by the EPCG authorisation holder or the supporting

pg. 124
 manufacturer where the capital goods imported under the
authorisation have been installed. The goods manufactured by the
authorisation holder shall be exported as it is by the ultimate
exporter (third party exporter) without further processing.
Proceeds realised through normal banking channel from third party
exporter’s account to the authorisation holder’s account on account
of such exports shall only be counted towards fulfillment of export
obligation.
(c) Disclaimer certificate from third party that they shall not use such
proceeds towards EO fulfillment of any EPCG authorisation (s)
obtained by them.
(d) The EPCG authorisation holder shall submit the following additional
documents for discharge of EO through third party exporter(s):
(i) Proof of having dispatched the goods from authorisation
holder’s factory premises to the ultimate exporter/port of
export viz.
(a) ARE 1 certificate issued by Central Excise/Tax invoice for
export prescribed under the GST rules with due
authentication by the Customs verifying the exports along
with the shipping bill number, date and EPCG authorisation
number, or
(b) Invoice duly incorporating the relevant EPCG
authorisation number & date at the time of dispatch in case
the unit is not registered with Central Excise/GST.
(ii) Lorry Receipt (LR) /Logistical evidence for transportation of
goods from the premises of the authorisation holder to the
third party exporter/Port of export.
(iii) An undertaking from the third party exporter on a stamp
paper, declaring that the products exported for fulfillment of
EO by them on behalf of the license holder as per details given
in the statement of exports, were manufactured by the license
holder.
(iv) Financial evidence for having received proceeds through
normal banking channel from third party exporter’s account
to the authorisation holder’s account on account of such
exports towards such third party supplies.
(v) Disclaimer certificate from third party exporter that they
shall not use such proceeds towards EO fulfillment of any
EPCG authorisation(s) obtained by them.

pg. 125
5.11 Realization of Export proceeds
Export proceeds shall be realized in freely convertible currency or in Indian
Rupees as per para 2.53 of FTP, except for Deemed Exports supplies under
Chapter-7 of FTP. Exports to SEZ units/Supplies to developers/co-developers
irrespective of currency of realization would also be counted for discharge of
Export Obligation. Realization in case of supplies to SEZ units shall be from
foreign currency account of the SEZ unit.

5.12 Calculation of Average Export Obligation

While calculating Average Export Obligation, exports counted/being counted for
fulfilling specific EO against EPCG Authorisations within valid EO Period
(whether original or extended) that have been made in the preceding 3 years will
not be taken into account.

5.13 Block-wise Fulfillment of EO

(a) The Authorisation holder under the EPCG scheme shall, while maintaining
the average export obligation, fulfill the specific export obligation over the
prescribed block period in the following proportions:

Period from the date of issue Minimum export

of Authorisation obligation to be fulfilled
Block of 1st to 4th year 50%
Block of 5th and 6th year Balance EO

(b) The Authorisation holder would intimate the Regional Authority on the
fulfilment of the export obligation, as well as average exports, within three
months of completion of the block.

(c) Request for extension of Export Obligation period of first block shall be
submitted within 6 months from the date of expiry of first block EO period
along with composition fee of 2% on duty saved amount proportionate to
unfulfilled portion of EO pertaining to the block. RA may consider the
request for extension of block wise EO period, received after 6 months, but
within 6 years from date of issue of authorisation, with a late fee of Rs.
10,000/- per authorisation. Application made beyond 6 years, for
extension of block-wise EO period for regularization purpose, shall also be
considered by RA concerned, with an additional late fee of Rs. 5,000/- for
each year per authorisation. This late fee is in addition to the composition

pg. 126
 fee that may be payable on account of shortfall in export obligation. Where
EO of the first block is not fulfilled in terms of para (a) above, except in
cases where the EO prescribed for first block is extended by the RA, the
Authorisation holder shall, within 6 months from the expiry of the block,
pay duties of customs (along with applicable interest as notified by DOR)
proportionate to duty saved amount on total unfulfilled EO of the first
block.

(d) (i) Authorisations issued from 1st April, 2002 upto 31st August, 2004 shall
be governed by provisions of paragraph 5.8 of HBP Vol.1 (RE-02) as
amended from time to time.

(ii) Authorisations issued from 1st September, 2004 upto 17th April, 2013
shall be governed by provisions of paragraph 5.8 of HBP Vol.1 (RE-12) as
amended till 17.04.2013.

(iii) Authorisations issued from 18th April, 2013 till issue of Notification
of FTP 2015-20 shall be governed by provisions of paragraph 5.8 of HBP
Vol. 1 as amended vide PN No. 1 dated 18.04.2013.

(iv) Authorisations issued from 1st April, 2015 till 4th December, 2017
shall be governed by provisions of paragraph 5.14 of HBP as amended vide
PN No. 1 dated 01.04.2015.

(v) Authorisations issued from 5th December, 2017 till 31st March 2023
shall be governed by provisions of paragraph 5.14 of HBP as amended vide
PN No. 43 dated 05.12.2017.

5.14 Annual reporting of EO fulfilment

Authorisation holder shall submit to RA concerned by 30th June of every year, a
report on fulfilment of export obligation through online. Such report shall contain
a statement with details such as Shipping bill/GST invoice number, date of
export/supply, description of product exported/supplied/service rendered and
FOB/FOR value of export/supply for both specific as well as average export
obligation. Any delay in filing such annual report shall be regularised on payment
of a late fee of Rs. 5000/- per year for each authorisation.

5.15 Automatic Reduction/Enhancement upto 10% Duty saved

amount and pro rata Reduction/Enhancement in export obligation
If authorisation issued has been utilized for import of goods:-

(a) In excess of duty saved amount indicated on the authorisation by not more
than 10%, the authorisation shall be deemed to have been enhanced by

pg. 127
 that proportion. Customs shall automatically allow clearance of such goods
without endorsement by RA concerned. The authorisation holder shall
furnish additional fee to cover excess imports effected, in terms of duty
saved amount, to RA concerned, at the time of application for EODC.
Export obligation shall automatically stand enhanced proportionately.
(b) In excess of duty saved amount indicated on the authorisation by more
than 10%, the RA concerned, as per its delegated powers, may allow
enhancement in duty saved amount of the EPCG authorisation. The
Authorisation holder shall furnish additional BG/LUT to the Customs
Authority.

(c) Less than the duty saved amount indicated on the authorisation, the export
obligation shall stand reduced on pro-rata basis with reference to actual
utilization of the authorisation.

5.16 Extension in Export Obligation Period

(a) Extension in Export Obligation Period of EPCG authorisation issued prior
to Notification of Foreign Trade Policy 2023 shall be governed by relevant
provisions of HBP applicable on the date of issue of authorisation.
(b) In case of extension of Export obligation period beyond 6 years, two
extensions, from date of expiry, of one year each may be considered by RA
concerned, on payment of composition fee equal to 2% of proportionate
duty saved amount on unfulfilled export obligation for each year of
extension. However, minimum composition fee shall be Rs.10,000/-.
(c) Request for extension in EO Period shall be made to RA concerned within
6 months from the date of expiry of original EO Period. However, RA may
consider the request for extension received after 6 months, but within the
extendable validity of EO period, with a late fee of Rs. 10,000/-. The
request for extension for regularisation purpose, from 6th to 8th year, may
also be considered after expiry of EO period on payment of late fee of Rs.
15,000/-. This fee is in addition to the composition fee that may be payable
on account of shortfall in export obligation. However, EO extension,
beyond 8 years from date of issue of authorisation, shall not be allowed by
RA under this provision.
(d) Notwithstanding sub-para (a) above, sub-paras (b) and (c) above shall also
be applicable for authorisations issued under FTP (2015-20).

5.17 Relief in Average Export Obligation

(a) To provide relief to exporters of those sectors where total exports in that
sector/product group has declined by more than 5% as compared to the
previous year, average export obligation for the year may be reduced
proportionate to reduction in exports of that particular sector/product
group during the relevant year as against the preceding year. However, in
pg. 128
 case export decline is continuous over consecutive years, the base year for
calculation of eligibility and calculation of reduction in average export
obligation will be taken as the year after which the exports have shown
continuous decline.

(b) The sectors /product groups for which this relaxation is to be allowed
shall be conveyed by the DGFT to all the RAs within seven months of the
end of the previous financial year and the RAs shall re-fix the annual
average EO for previous year accordingly for exporters in that sector/
product group.

5.18 Maintenance of Annual Average Export Obligation

The excess exports done towards the average export obligation fulfilment of an
EPCG authorisation during a year can be used to offset any shortfall in the
Average EO done in other year(s) of the EO period or the block period as the case
may be provided Average EO imposed is maintained on an overall basis, within
the block period or the EO period as applicable.

5.19 Automatic EO extension in the event of ban on export product

Whenever a ban/restriction is imposed on export of any product, export
obligation period in respect of EPCG authorisations already issued prior to
imposition of ban on such export products would stand automatically extended
for a period equivalent to duration of such ban, without any composition fee.
Authorisation holder would not be required to maintain average EO as well for
the ban period.

5.20 Export Obligation Discharge Certificate (EODC)

(a) Authorisation holder shall apply for online EODC in ANF 5B with documents
prescribed therein as a proof of EO fulfillment.

(b) On being satisfied, RA concerned shall issue EODC to the EPCG authorisation
holder and an online copy will be forwarded to ICEGATE through API message
exchange for further action by Jurisdictional Customs Authorities with whom
BG/LUT has been executed.

(c) RA shall process such applications ordinarily within 30 days. Shortcomings, if

any, shall be pointed out normally in one go. Once documents are complete in all
respects, export obligation shall be discharged within 30 days of receipt of
complete documents /information.

5.21 Regularization of bonafide default and exit from EPCG scheme

(a) Authorisation holder shall have the option to surrender the unutilised

pg. 129
 authorisation at any point of time. In such cases no penalty or fees shall be
levied.
(b) In case, EPCG authorisation holder fails to fulfill prescribed export
obligation, he shall pay customs duty/taxes/cess in proportion of shortfall
in export obligation along with applicable interest as prescribed by
Customs Authority. Such facility can also be availed by EPCG authorisation
holder to exit at his option.
(c) In case of domestic sourcing of capital goods through invalidation
letter/ARO, the duties, taxes and cess payable shall be with reference to
the notional Customs duties/taxes/cess saved on the FOR value of capital
goods (including spares, jigs, fixtures, dies and moulds).
(e) Authorisation holder can also provisionally pay duty and interest suo-
moto on the basis of self/own calculation as per the procedure specified in
paragraph 4.50 of HBP.

5.22 Maintenance of Records

Every EPCG authorisation holder shall maintain, for a period of 2 years from date
of redemption, a true and proper account of exports/ supplies made and services
rendered towards fulfillment of export obligation.

5.23 Re-Export / Repair/Replacement of Capital Goods Imported

under EPCG Scheme
(a) Capital Goods imported under EPCG scheme, which are found defective or
unfit for use, may be re-exported to foreign supplier within three years from the
date of clearance by Customs of such goods, with permission of RA/Customs
Authority. Consequently, EO would be re-fixed.

(b) Capital Goods imported and found defective or otherwise unfit for use may be
exported, within two years from the date of clearance by Customs of such goods,
with permission of RA / Customs Authority and Capital Goods in replacement
thereof be imported under EPCG scheme. In such cases, while allowing export,
the Customs shall credit the duty benefit availed which can be debited again at
the time of import of such replaced Capital Goods.

(c) Capital Goods imported under EPCG scheme, may be re-exported for repairs
abroad within three years from the date of clearance by Customs of such goods,
with permission of RA / Customs Authority. The duty component on the
expenditure incurred on the repairs as well as the insurance and the freight, both
ways shall be taken into account for re-fixation of the EO.

5.24 Penal Action

In case of failure to fulfil export obligation or any other condition of

pg. 130
authorisation, authorisation holder shall be liable for action under FT (D&R) Act,
1992, as amended, Orders and Rules made thereunder, provisions of FTP/HBP,
Customs Act, 1962, as amended from time to time or any other law in force.

5.25 Clubbing of EPCG authorisations

(a) Clubbing of two or more EPCG authorisations issued to the same
authorisation holder would be permitted.

(b) An application for clubbing can be made to RA concerned in ANF 5C. Clubbing
shall only be permitted in case export products endorsed on the authorisations
are same/similar and if authorisations are issued by the same RA.

(c) Total export obligation would be re-fixed taking into account total of duty
saved amount of the clubbed authorisations.

(d) On Clubbing, authorisations for all purpose shall be deemed to be a single

EPCG authorisation. Export obligation period for clubbed authorisations shall be
reckoned from first authorisation issue date.

(e) Average export obligation for clubbed authorisations would be highest of

average export obligations endorsed on individual authorisations so clubbed.

(f) Clubbing would be permitted during valid EOP including extended period, if
any. However, clubbing in case of all authorisations where EO period is over may
be allowed for regularisation purposes provided they have been issued under
same policy period.

(g) In case of clubbing of EPCG authorisations where EO can be fulfilled by export

of alternate product(s)/service(s), the proportion of alternate
product(s)/service(s) for EO fulfillment/ regularization will be restricted to the
lowest of the percentage of alternate product(s)/service(s) allowed in the
clubbed authorisations.

(h) EPCG authorisations issued prior to 01.04.2007 shall be governed by

provisions contained in Chapter 5 of HBP Vol.1 (RE-2006).The EPCG
Authorisations issued between 01.04.2007 and 17.04.2013 shall be governed by
provisions contained in Chapter 5 of HBP Vol.1 (RE-2012, as amended). The
EPCG Authorisations issued from 18.04.2013 till the issue of notification of HBP
2015-20 shall be governed by provisions contained in Public Notice No.1 dated
18.04.2013. The EPCG Authorisations issued between notification of HBP 2015-
20 till the notification of HBP 2015-20 (RE-2017) shall be governed by
provisions contained in HBP 2015-20. The EPCG Authorisations issued between
notification of HBP 2015-20 (RE-2017) till the notification of HBP 2023 shall be
governed by provisions contained in HBP 2015-20 (RE-2017).

pg. 131
5.26 Green Technology Products
The Export Products covered under Paragraph 5.10 of FTP which provides for
reduced export obligation of 75% for green technology products are :
(i) Solar Energy Generating Systems and parts/Equipments thereof,
(ii) Wind Energy Generating Systems and parts/equipment thereof,
(iii) LED lights of various kind,
(iv) Vapour Absorption Chillers,
(v) Waste Heat Boiler,
(vi) Waste Heat Recovery Units,
(vii) Unfired Heat Recovery Steam Generators,
(viii) Water Treatment Plants,
(ix) Battery Electric Vehicles (BEV) [other than Hybrid Electric Vehicles
(HEVs) and Plug-in Hybrid Electric Vehicle (PHEV)] of all types,
(x) Vertical Farming equipment,
(xi) Wastewater Treatment and Recycling,
(xii) Rainwater harvesting system and rainwater filters, and
(xiii) Green Hydrogen.

pg. 132
CHAPTER 6

Export Oriented Units

(EOUs), Electronics
Hardware Technology
Parks (EHTPs), Software
Technology Parks (STPs)
and Bio-Technology
Parks (BTPs)
 Chapter-6
Export Oriented Units (EOUs),
Electronics Hardware Technology Parks(EHTPs),
Software Technology Parks (STPs) and
Bio-Technology Parks (BTPs)

6.00 Scheme
Policy relating to EOUs, EHTPs, STPs and BTPs Schemes is given in Chapter 6 of
Foreign Trade Policy (FTP).

6.01 Application / Approval / Renewal of approval

(a) For setting up an EOU, three copies of application as in ANF 6A of
Appendices & ANFs may be submitted to DC.
(b) (i) Applications for setting up units under EOU scheme shall be
approved or rejected by Units Approval Committee within 15
days, as per criteria indicated in Appendix 6A of Appendices &
ANFs and sector specific conditions relating to approval as in
Appendix 6B of Appendices & ANFs. In other cases, approval
may be granted by DC after clearance by BOA.
(ii) STP / EHTP complexes can be set up by Central Government,
State Government, Public or Private Sector Undertakings or any
combination thereof, duly approved by Inter-Ministerial
Standing Committee (IMSC) in Ministry of Electronics &
Information Technology-MeitY. Application for setting up EHTP
/ STP unit shall be in format prescribed by MeitY and shall be
submitted to officer designated by MeitY.
(iii) A BTP can be set up by Central Government, State Government,
Public or Private Sector Undertakings or any combination
thereof. Application for setting up of BTP shall be submitted to
Department of Bio-Technology (DoBT) and such applications
which meet guidelines prescribed by DoBT will be approved
and recommended to DGFT for notification. Application for
setting up of BTP unit shall be submitted to officer designated
by DoBT.
(c) On approval, a Letter of Permission (LoP) / Letter of Intent
(LoI) shall be issued by DC / designated officer to EOU/ EHTP /

pg. 134
 STP / BTP unit. LoP / LoI shall have an initial validity of 2
years to enable the Unit to construct the plant & install the
machinery and by this time the unit should have commenced
production. In case the unit is not able to commence production
in the initial validity period of 2 years, an extension of one year
may be given by the DC for valid reasons to be recorded in
writing. Subsequent extension of one year may be given by the
Unit Approval Committee subject to condition that two thirds
of activities including construction, relating to the setting up of
the Unit are completed and a Chartered Engineer’s certificate to
this effect is submitted by the Unit. Further extension, if
necessary, will be granted by the Board of Approval. Once unit
commences production, LoP / LoI issuedshall be valid for a
period of 5 years for its activities. This period may be extended
further by DC for a period of upto 5 years at a time. However, in
case of extension of LoP required for completing exit formalities,
the LoP may be extended for a limited period i.e. less than 5 years
by the DC.
(d) Proposals for setting up an EOU requiring industrial licence
may be granted approval by the concerned DC after clearance of
proposal by BOA (as per Appendix 6C of Appendices & ANFs)
and Department for Promotion of Industry and Internal Trade
(DPIIT) within 45 days.
(e) LoP / LoI shall specify item(s) of manufacture / service activity,
annual capacity, projected annual export for first five years in
dollar terms, Net Foreign Exchange (NFE) earnings, limitations,
if any, regarding sale of finished goods, by-products and rejects
in DTA and such other matter as may be necessary and also
impose such conditions as may be required.
(f) LoP / LoI issued to EOU / EHTP / STP / BTP units by concerned
authority would be construed as an authorisation for all
purposes. Standard format for LoP for EOU is given in Appendix
6D of Appendices & ANFs.
(g) EOUs shall have separate earmarked premises for separate LoP.
Similarly, EOUs may be approved on leased premises provided
lease has been obtained from Government Department /
Undertaking / Agency. However, in case lease is obtained from
private parties, it shall have a validity period of five years from
date of LUT and DC shall satisfy himself of genuine nature of
lease.
(h) On completion of validity of LOP/LOI as provided for in
Paragraph 6.05 of FTP, it shall be open to unit to continue under
pg. 135
 scheme or opt out of scheme. Where unit opts to continue,
DC/Designated Officer will extend validity of the LOP/LOI. If no
intimation in this regard is received from unit within a period of
six months of expiry of the validity, DC/Designated Officer will,
suomoto, take action to cancel approval under the scheme and
take further action in this regard. Where units give their option
to continue after expiry of six months as stipulated above,
DC/Designated Officer will grant extension after obtaining
approval of BOA/IMSC.

6.02 Legal Undertaking (LUT)

(a) Approved EOU / EHTP / STP / BTP unit shall execute an LUT with
DC / Designated Officer concerned as in Appendix 6E of
Appendices & ANFs.
(b) All EOU / EHTP / STP / BTP units should have permanent e-mail
address. No LUT for new units shall be executed unless unit has
its permanent e-mail address and digital signature on said e-mail
ID. In event of an EOU not having permanent e-mail address and
digital signature, further imports and DTA sale shall not be
permitted by DC.

6.03 Export of Goods and Services

(a) Software units may undertake exports using data communication
links or in form of physical exports (which may be through
courier service also), including export of professional services.
(b) EOUs shall be permitted to export jewellery on basis of a notional
rate certificate issued by nominated agency. This rate will be
based on prevailing Gold / US$ rate and US$ / INR rate in notional
rate certificate. Certificate issued by nominated agency should not
be older than 7 working days of date of shipment.
(c) Exporter shall have flexibility to fix price and repay gold loan
within 180 days from date of export. Price shall be communicated
to nominated agencies who will issue a certificate showing final
confirmation of rate to bank negotiating document, to ensure
export proceeds are realized at this rate.
(d) Gems & Jewellery EOUs may re-export imported goods and export
domestically procured goods, including goods generated out of
partial processing/ manufacture. Besides, supply of unsuitable /
broken cut and polished diamonds, precious and semi-precious
stones upto 5% of value of imported or indigenously procured
pg. 136
 goods to DTA against valid Gems & Jewellery REP as applicable on
payment of appropriate duty is also permitted.

6.04 Import / Domestic Procurement of Goods

Goods permitted to be imported / procured from DTA shall include:
(a) Raw materials, components, consumables, intermediates, spares
and packing materials.
(b) Capital goods and its spares, whether new or second-hand which
inter-alia includes the following:
(i) Captive power plants (DG Sets, Wind Power, Solar Power),
including transformers and accessories. This would be
subject to the condition that no tax/duty benefits stipulated
under EOU Scheme shall be available for setting up as well
as operations and maintenance of such wind and solar
power plants.
(ii) Pollution control equipment.
(iii) Quality assurance equipment.
(iv) Material handling equipment, like fork lifts and overhead
cranes, mobile cranes, crawler cranes, hoists and stackers.
(v) Un-interrupted Power Supply System (UPS), Special racks
for storage, storage systems, modular furniture, computer
furniture, anti-static carpet, teleconference equipment,
Servo Control System, Air- conditioners / Air conditioning
system, panel for electricals and special data transmission
cable.
(vi) Security Systems
(vii) Tools, jigs, fixtures, gauges, moulds, dyes, instruments and
accessories.
(c) Raw materials for making capital goods for use within unit.
(d) Others including:
(i) Prototypes and technical samples for existing product(s)
and product diversification development or evaluation.
(ii) Drawings, blue prints, charts, microfilms and technical data.
(iii) Office equipment, including PABX, Fax machines, projection
system, Computers, Laptop and Server.

pg. 137
 (e) Spares and consumables for above items.
(f) Any other items not mentioned above with approval of BOA.

6.05 Repair / Remaking of Jewellery

EOUs may import plain / studded gold / platinum or silver jewellery for export
after repairs / remaking.

6.06 Conditions of Import

Import of goods by EOU / EHTP / STP / BTP units shall be subject to following
conditions:
(a) Goods shall be imported into EOU / EHTP / STP / BTP premises.
However, agriculture and allied sectors and granite sector units in
EOU may supply / transfer capital goods and inputs in farm /
fields / quarries with prior intimation to jurisdictional Customs
authorities, provided ownership of goods rests with EOUs. Granite
sector would also be allowed to take spares upto 5% of value of
Capital Goods to quarry site.
(b) Procedure as prescribed under Customs/Central Excise rules for
EOUs and units in EHTP / STP / BTP will be followed and
appropriate bond executed with Customs/Central Excise
Authorities.
(c) (i) The period of utilisation of goods, including capital
goods, shall be co-terminus with the validity of LoP.
(ii) However, imported tea shall be utilized within a period of 6
months from date of import. Similarly, export obligation
against import of items {covered by Chapter 9 of ITC(HS)}
and coconut oil shall be fulfilled within a period of 90 days
from the date on which first import consignment is cleared by
Customs Authorities.
(iii) Further, in case of import of spices for VA purpose like
crushing / grinding / sterilization or for manufacture of oils
and oleoresins of pepper, cardamom and chillies (and not
for simple cleaning, grading, re- packing etc.), EO shall be
fulfilled within 120 days from the date of importation of
first consignment. In case of import of spices (other than
pepper, cardamom and chillies) for manufacture of spice
oils and oleoresins, EO shall be fulfilled within 12 months.
(d) Goods already imported / shipped / arrived before issue of LoP /
LoI are also eligible for clearance as provided under para 6.01 (d)
pg. 138
 (ii) of FTP under EOU / EHTP / STP / BTP scheme without
payment of duty and/or taxes as applicable, provided, the said
duties and/or taxes has not been paid and goods have not been
cleared from Customs.
(e) Consumption of inputs by the EOU / EHTP / STP / BTP unit shall
be based on the Standard Input Output Norms (SION) provided
that:
(i) where no SION have been notified, generation of waste,
scrap and remnants upto 2% of input quantity shall be
allowed;
(ii) where additional items other than those given in SION are
required as inputs or where generation of waste, scrap and
remnants is beyond 2% of input quantity, use of such
inputs shall be allowed by the jurisdictional DC within a
period of three months from the date of application and
based on self declared norms, with the unit undertaking to
adjust self- declared / ad hoc norms in accordance with
norms as finally fixed by Norms Committee in DGFT;
(iii) in case of any difficulty in fixation of SION as above, BOA in
consultation with Norms Committee in DGFT, will decide
on a case to case basis.

6.07 Taking out of Fax Machines / Laptop / Computers outside

approved premises
(a) EOU / EHTP / STP / BTP units may install one fax machine at a
place of its choice, outside premises of unit, subject to intimation
of its location to concerned Customs authorities.
(b) EOU / EHTP / STP / BTP units may, temporarily take out of
premises of unit, duty and/or tax free laptop / computers and
video projection systems for working upon by authorized
employees.
(c) EOU / EHTP / STP / BTP units may install personal computers not
exceeding two in number, imported / procured duty and/or tax
free in their registered / administrative office subject to DoR
guidelines.
(d) For IT and IT enabled services, persons authorized by software
units may access facility installed in EOU / EHTP / STP / BTP unit
through communication links.

pg. 139
6.08 Facility of working from a place outside the unit
Person(s) / employee(s) authorized by a unit of (i) IT related EOU or (ii) STP or
(iii) EHTP or (iv) BTP may work from a place outside the said unit, subject to
the following conditions:
(i) There must be an Authorisation from the unit specifying the
duration of suchauthorisation.

(ii) The Unit shall be responsible for carrying out the work and
supervision and shall be liable for any misuse.

(iii) Export of the resultant products / services would take place

only from the premises of the unit.

6.09 Leasing of Capital Goods

Value of imported capital goods financed through leasing companies or

obtained free of cost and / or on loan / lease basis, shall also be taken into
account for purpose of calculation of NFE as defined in FTP.

6.10 Net Foreign Exchange (NFE) Earnings

(a) EOU / EHTP / STP / BTP unit shall be a positive net foreign
exchange earner. NFE earnings shall be calculated cumulatively in
the block period as per Paragraph 6.04 of FTP, according to the
formula given below. Items of manufacture for export specified in
LoP / LoI alone shall be taken into account for calculation of NFE.

Positive NFE = A-B>0

Where,
“NFE” is Net Foreign Exchange;

“A” is FOB value of exports by EOU / EHTP / STP / BTP unit

and other supplies under para 6.08 of FTP;

“B” is sum total of CIF value of all imported inputs and CIF
value of all imported capital goods, and value of all payments
made in foreign exchange by way of commission, royalty, fees,
dividends, interest on external borrowings / high sea sales
during first five year period or any other charges. It will also
include payment made in Indian Rupees on high sea sales; and

“Inputs” mean raw materials, intermediates, components,

pg. 140
 consumables, parts and packing materials.
(b) If any goods are obtained from another EOU / EHTP / STP / BTP /
SEZ unit, or procured from an international exhibition held in
India, or bonded warehouses or precious metals procured from
nominated agencies, value of such goods shall be included under
“B”.
(c) If any capital goods are imported duty and/or tax free or leased
from a leasing company, received free of cost and / or on loan
basis or transfer, CIF value of capital goods shall be included pro-
rata, under “B” for period it remains with units.
(d) For annual calculation of NFE, value of imported capital goods and
lump sum payment of foreign technical know-how fee shall be
amortized as under: 1st– 10th year : 10%. Provided that above
amortization rates would be applicable only if an undertaking is
given by a unit that it will not exit to DTA in the first 10 years. For
existing units, proportionate Customs and excise duty must be
paid where NFE is less than depreciation already claimed, before
exit.

6.11 Maintenance of Accounts

a) EOU / EHTP / STP / BTP unit shall maintain proper account, and
shall file digitally signed quarterly and annual report as
prescribed in Annexure to Appendix 6E of Appendices & ANFs to
DC / Designated Officer in MeitY / DoBT and Customs and Central
Excise authorities. In addition, STP unit shall file, every month,
report of services classified in Annexure V of Appendix 6E of
Appendices & ANFs in the ‘Service Exports Reporting Form
(SERF)’ prescribed in Annexure VI of Appendix 6E of Appendices
& ANFs to the designated officer in STP. Use of SERF would be
limited to capturing information on services exports from STPs.
b) Unit shall be able to account for entire quantity of each category of
homogenous goods imported / procured duty and/or tax free, by
way of exports, sales / supplies in DTA or transfer to other SEZ /
EOU / EHTP / STP / BTP units and balance in stock. However, at
no point of time, units shall be required to correlate every import
consignment with its exports, transfer to other SEZ / EOU / EHTP
/STP / BTP units, sales in DTA and balance in stock. Any matter
for clarification as to whether goods are homogenous or not shall
be decided by Units Approval Committee.

pg. 141
6.12 Monitoring of NFE
Performance of EOUs shall be monitored by Units Approval Committee as per
guidelines given in Appendix 6F of Appendices & ANFs. Performance of EHTP /
STP / BTP shall be monitored by MeitY / DoBT jointly with jurisdictional
Customs authority.

6.13 Conversion of Scrap / Dust / sweeping of Gold / Silver /

Platinum into Standard Bars
Scrap / dust / sweeping of gold / silver / platinum may be sent to Government
of India Mint / private mint from EOU / EHTP / STP units and returned to
them in standard bars in accordance with procedure prescribed by Customs
authorities, or may be permitted to be sold in DTA on payment of applicable
GST and compensation cess alongwith reversal of duties of Customs leviable
under First Schedule of the Customs Tariff Act, 1975 availed as exemption on
inputs, on basis of gold / silver / platinum content, as may be notified by
Customs authorities.

6.14 DTA Supplies

Notwithstanding provision of DTA sales in Paragraph 6.07 of FTP, such DTA
sales shall not affect application, to any goods, of any other prohibition or
regulation affecting import thereof in force at the time, when such goods are
imported. This also does not confer any immunity, exemption or relaxation at
any time from any commitment or compliance with any requirements to which
importer may be subject to under other laws or regulations.

6.15 Supplies to other EOU / EHTP / STP / SEZ / BTP Units

Supplies to other EOU / EHTP / STP / BTP / SEZ units shall be counted
towards NFE provided that such goods are permissible for procurement by
these units.

6.16 Transfer of Power from one Unit to another

Transfer of power from Captive Power plants from one unit of EOU / EHTP /
STP / BTP unit to another is permitted as prescribed in sector specific
condition in Appendix 6B of Appendices & ANFs.

6.17 Supply of Precious / Semi-precious / Synthetic Stones from DTA

Supplier of precious and semi-precious stones, synthetic stones and processed

pg. 142
pearls from DTA to EOUs shall be eligible for grant of Replenishment
Authorisation at rates and for items mentioned in HBP. Procedure for
submission of application for grant of Replenishment Authorisation as
contained in relevant Chapter of HBP Vol. I shall be applicable. However,
application shall be made to DC concerned. Such supplies to EOUs are not
eligible for any of deemed export benefits under Chapter 7 of the FTP.

6.18 Application for grant of entitlements

Application for grant of all entitlements may be made to DC/Designated Officer
concerned.

6.19 Export through Other Exporters

An EOU / EHTP / STP / BTP unit may export goods manufactured / software
developed by it through other exporter, or any other EOU / EHTP/ STP / BTP /
SEZ unit subject to condition that:
a) Goods shall be produced in EOU / EHTP / STP / BTP unit
concerned.
b) Level of NFE or any other conditions relating to imports and
exports as prescribed shall continue to be discharged by EOU /
EHTP / STP / BTP unit concerned.
c) Export orders so procured shall be executed within parameters of
EOU / EHTP / STP / BTP schemes and goods shall be directly
transferred from unit to port of shipment.
d) Fulfilment of NFE by EOU / EHTP / STP / BTP units in regard to
such exports shall be reckoned on basis of price at which goods
are supplied by EOUs to other exporter or other EOU / EHTP / STP
/ BTP / SEZ unit.
e) All export entitlements, including recognition as Status Holder
would accrue to exporter in whose name foreign exchange
earnings are realized. However, such export shall be counted
towards fulfilment of obligation under this scheme only.

6.20 Other Entitlements

a) FOB value of export of an EOU / EHTP / STP / BTP unit can be
clubbed with FOB value of exports of its parent company in DTA or
vice versa for the purpose of according Status Holder Certificate.
b) Sectoral norms as notified by Government shall apply to FDI in
service activities.
pg. 143
 c) STP Units / EHTP Units / Software EOUs may also use all duty
and/or tax free equipment / goods for training purpose (including
commercial training), subject to condition that no duty free
equipment / goods shall be installed outside premises of the unit
for this purpose.
d) Export of iron ore shall be subject to decision of Government.
Requirements of other conditions of exports like minimum export
price / export in consumer pack etc. as per ITC (HS) shall apply in
case raw materials are sourced from DTA and exported without
further processing / manufacturing by EOU. Export of textile
items shall be covered by bilateral agreements, wherever
applicable. Wood based units shall comply with direction of
Supreme Court contained in its order dated 12.12.1996 in Writ
(civil) No 202 of 1995- T.N. Godavarman Thirrumulppad v/s
Union of India and others with WP (Civil) No 171 of 1996 in
regard to use of timber / other wood.

6.21 Sub–Contracting
a) Sub-contracting by EOU gems and jewellery units through other
EOUs, or SEZ Units, or units in DTA shall be subject to following
conditions:-
(i) Goods, finished or semi finished, including studded
jewellery, taken out for sub-contracting shall be brought
back to unit within 90 days. However, the Customs
Authorities may grant an extension of time beyond 90 days
in deserving cases.
(ii) No cut and polished diamonds, precious and semiprecious
stones (except precious, semi- precious and synthetic
stones having zero duty) shall be allowed to be taken out
for sub- contracting.
(iii) Plain gold / silver / platinum jewellery can be received
from DTA / EOU/ SEZ units in exchange of equivalent quantity
of gold / silver / platinum, as the case may be, contained in said
jewellery.
(iv) EOUs shall be eligible for wastage as applicable as per
paragraph 4.59 of HBP for sub-contracting and against
exchange.
(v) DTA unit undertaking job work or supplying jewellery
against exchange of gold / silver / platinum shall not be
entitled to deemed export benefits under Chapter 7 of FTP.

pg. 144
 b) Facility of getting job work done from DTA unit will be available
subject to condition that goods are brought back to premises of
unit on completion of job work.
c) Export of finished goods from job worker’s premises may be
permitted, provided such premises are registered with Central
Excise/GST authorities. Where job worker is SEZ / EOU / EHTP /
STP / BTP unit, export may be effected either from job worker’s
premises or from premises of unit. Export of such products from
job worker’s premises shall not be allowed through third parties
as provided in FTP.
d) EOUs may be permitted to remove moulds, jigs, tools, fixtures,
tackles, instruments, hangers and patterns and drawings to
premises of sub-contractors, subject to condition that these shall
be brought back to premises of units on completion of job work
within a stipulated period. Raw materials may or may not be sent
along with these goods.
e) In case of sub-contracting of production process abroad, goods
may be exported from sub-contractor premises subject to
conditions that at the time of clearance of goods, the EOU / EHTP
/ BTP / STP unit shall declare
(i) the transaction value of the finished goods to be cleared
from the sub- contractor’s premises abroad;
(ii) job work charges to be paid to the sub-contractor
abroad; and
(iii) value of intermediate goods;
supported with documents like sale price contract / or invoice for
the finished goods, job work contract and the basis of arriving at
the value of intermediate goods. The EOU / EHTP / BTP / STP unit
shall also ensure full repatriation of foreign exchange declared as
the transaction value of the finished goods cleared from the sub-
contractor’s premises abroad.

6.22 Contract Farming

EOUs engaged in production / processing of agriculture / horticulture /
aquaculture products may, on basis of annual permission from Customs
authorities, take out inputs and equipments (specified in Appendix 6I of
Appendices & ANFs) to DTA farm subject to following conditions:
a) Supply of inputs by EOUs to contract farm(s) shall be subject to
input-output norms approved by DGFT / BOA.
b) There shall be contract farming agreement between EOU and DTA
pg. 145
 farmer(s).
c) Unit has been in existence for at least two years and engaged in
export of agriculture / horticulture / aquaculture products;
otherwise it shall furnish bank guarantee equivalent to duty
and/or taxes foregone on capital goods / inputs proposed to be
taken out, to Deputy / Assistant Commissioner of Customs, till
unit completes two years.

6.23 Exports through Exhibitions / Export Promotion Tour

EOU / EHTP / STP / BTP units may export goods for holding / participating in
exhibitions abroad, with permission of DC, subject to following conditions:
a) Unit shall produce to Customs authorities letter in original, or its
certified copy containing approval of DC. For gems and jewellery
items, a self certified photograph of products shall also be
submitted.

b) In case of re-import, such items, on arrival shall be verified along

with export documents before clearance.

c) Items not sold abroad shall be re-imported within 60 days of close

of exhibition. However, in case exporter is participating in more
than one exhibition within 45 days of close of first exhibition, then
60 days shall be counted from date of close of last exhibition. In
case of exhibition in USA, the time period shall be 90 days
instead of 60 days mentioned above.
d) In case of personal carriage of goods and for holding /
participating in overseas exhibitions, value of such gems and
jewellery shall not exceed US $ 5 million.

6.24 Personal Carriage of Gems and Jewellery as samples for Export

Promotion Tours
Personal carriage of gold / silver / platinum jewellery, cut and polished
diamonds, precious, semi-precious stones, beads and articles as samples upto
US $ 1 million for export promotion tours, and temporary display / sale abroad
by EOUs, is also permitted with approval of DC subject to following conditions:
a) EOU shall bring back goods or repatriate sale proceeds within 45
days from date of departure through normal banking channel.
b) Unit shall declare personal carriage of such samples to Customs
while leaving country and obtain necessary endorsement.

pg. 146
6.25 Export through Show-rooms abroad / Duty free shops
Export of goods is also permitted for display / sale in permitted shops set up
abroad or in showrooms of their distributors / agents. Items not sold abroad
within 180 days shall be re- imported within 45 days.

6.26 Sale through Showrooms / Retail outlets at International

Airports
EOUs may set up showrooms / retail outlets at International Airports for sale
of goods in accordance with procedure laid down by Customs authorities.
Items remaining unsold after a period of 60 days shall be exported or returned
to respective EOUs.

6.27 Personal Carriage of Import / Export Parcels including

through Foreign Bound Passengers
a) For Personal carriage of jewellery by foreign bound passenger,
following documents shall be submitted by EOUs as proof of
exports:
(i) Copy of shipping bill filed by EOUs;
(ii) A copy of Currency Declaration Form filed by
Foreign buyer with Customs at time of his arrival;
and
(iii) Foreign Exchange Realisation / Encashment
Certificate from Bank.
b) In addition to this, Personal Carriage by foreign bound passenger
on Document Against Acceptance (DA) / Cash On Delivery (COD)
basis is also allowed. EOUs will have to furnish following
documents as proof of exports:-
(i) Copy of Shipping Bill;
(ii) Bank Certificate of Export and Realisation.
c) Procedure for personal carriage of import parcels will be same as
for import of goods by airfreight except that parcels shall be
brought to Customs by EOUs / foreign national for examination
and release. Instructions issued by Customs authorities in this
regard should be followed mutatis mutandis.
d) Personal carriage of parts by foreign bound passengers shall be
allowed in case same are required for repairs of exported goods at

pg. 147
 customer site. Following documents should be submitted as proof
of exports:
(i) Permission letter from Customs for exports.
(ii) Invoice with value (for payment or free of charge).

6.28 Replacement / Repair of Imported / Indigenous Goods

a) Units may send capital goods abroad for repair with permission of
Customs authorities. Any foreign exchange payment for this
purpose will also be allowed. However, no permission will be
required for sending capital goods for repair within country.
b) EOU / EHTP / STP / BTP units may, on basis of records
maintained by them and prior intimation to Customs authorities:
(i) Transfer goods to DTA / abroad for repair / replacement,
testing or calibration and return.
(ii) Transfer goods for quality testing / R&D purpose to any
recognised laboratory / institution upto Rs. 10 lakh per
annum without payment of duty and/or taxes as applicable
in such cases on giving suitable undertaking to Customs for
return of goods. However, if goods have been consumed /
destroyed in process of testing etc. a certificate from
laboratory / institution to this effect be furnished to
Customs.

6.29 Samples
a) EOU / EHTP / STP / BTP units may on basis of records maintained
by them, and on prior intimation to Customs authority, supply or
sell samples in DTA for display / market promotion on payment of
excise duty, if applicable, and/or payment of GST and
compensation cess alongwith reversal of duties of Customs
leviable under First Schedule to the Customs Tariff Act, 1975, if
availed oninputs.
b) Remove samples without payment of duty and/or taxes on
furnishing a suitable undertaking to Customs authorities for
bringing back samples within a stipulated period.
c) An EOU may export free samples, without any limit, including
samples made in wax moulds, silver mould and rubber moulds
through all permissible mode of export including through courier
agencies / post. For statutory requirement of Stability &
Retention sample with manufacturer, an EOU / EHTP / BTP / STP
pg. 148
 unit may re-import with or without payment of duties/taxes as
provided at para 6.01(d)(ii) of FTP those samples, which were
exported by it, under intimation to Custom Authorities, and FOB
value of such samples shall not be counted for NFE purpose and
other export benefits, if any.
d) An EOU, on basis of records maintained by them and on prior
intimation to Customs authorities, may send samples to other
EOUs for display on returnable basis within a period of 30 days.

6.30 Donation of Computer and Computer Peripherals

EOU / EHTP / STP / BTP unit may be allowed by Customs authorities
concerned to donate imported / indigenously procured (bought or taken on
loan) computer and computer peripherals, including printer, plotter, scanner,
monitor, keyboard and storage units without payment of duty other than
applicable taxes under GST Law, two years after their import / procurement
and use by units, to a school run by Central Government, or Government of a
State, or a Union Territory, or a local body; an Educational Institution run on
non-commercial basis by any organization; a Registered Charitable Hospital; a
Public Library; a Public Funded Research and Development Establishment; a
Community Information Center run by Central Government or, Government of
a State or, a Union Territory or local body; an Adult Education Center run by
Central Government or, Government of a State or, a Union Territory or a local
body or, an organization of Central Government or, a Government of a State or,
a Union Territory as per Customs / Central Excise notification.

6.31 Distinct Identity

If an industrial enterprise is operating both as a domestic unit as well as an EOU
/ EHTP / STP/ BTP unit, it shall have two distinct identities with separate
accounts, including separate bank accounts. It is, however, not necessary for it to
be a separate legal entity, but it should be possible to distinguish imports and
exports or supplies effected by EOU / EHTP / STP / BTP units from those made
by other units of enterprise.

6.32 Unit Approval Committee for EOUs

a) Composition of Unit Approval Committee shall be as
under:

(i) Development Commissioner : Chairperson

(ii) Jurisdictional Commissioner of CBIC or nominee:
member
pg. 149
 (iii) Joint DGFT or nominee: Member
(iv) Joint / Deputy Development Commissioner of the
Zone: Member
(v) Any other nominee of any Department / Agency as
special invitee.
(b) Powers and functions of Unit Approval Committee of EOUs shall
be as under:
(i) To consider applications for setting up EOUs. Items
of manufacture requiring industrial licence under
Industrial (Development & Regulation) Act, 1951
shall be considered by BOA.
(ii) to consider and permit conversion of units in SEZ to
EOU;
(iii) to monitor performance of units;
(iv) to supervise and monitor permission, clearances,
licences granted to units and take appropriate action
in accordance with law;
(v) to call for information required to monitor
performance of unit under permission, clearances,
licenses granted to it;
(vi) to perform any other function delegated by Central
Government or its agencies;
(vii) to perform any other function as may be
delegated by State Governments or its agencies;
and
(viii) to grant all approvals and clearances for
establishment and operation of EOUs

6.33 Approval of EHTP / STP / BTP Units

In case of units under EHTP / STP scheme, necessary approval / permission
shall be granted by officer designated by MeitY / Director (STPI). Designated
officer shall also exercise powers of adjudication under Section 13 read with
Section 11 of FT(D&R) Act, 1992, as amended, in respect of STP / EHTP as
mentioned in Gazette Notification No. S.O. 106 (E) dated 30-1-2006. Similarly
in case of units under BTP, necessary approval / permission shall be granted
by officer designated by DoBT. However, designated officers shall adopt
criteria for automatic approval of new units as laid down in Appendix 6A of
Appendices & ANFs.
pg. 150
6.34 Powers of DC / Designated Officer
DC / Designated Officer shall have following powers in respect to units.
Jurisdiction of DC is given in Appendix 6J of Appendices & ANFs.
a) Conversion of sick / closed DTA unit into EOU;

b) Conversion of EOU to STP / EHTP / BTP and vice-versa as

per prescribed procedure;

c) To allow increase in value of capital goods in terms of Indian

Rupees, on account of foreign exchange rate fluctuations;

d) To permit capacity enhancement without any limit in case of

delicensed industries only;

e) Permit broad-banding for similar goods and activities mentioned

in LoP or to provide for backward or forward linkages to existing
line of manufacture;

f) Authorize change in name of company or implementing agency

and change from a company to another provided new
implementing agency / company undertakes to take over assets
and liabilities of existing unit;

g) Permit change of location from place mentioned in LoP to another

and / or include or exclude additional location/space provided
that no change in other terms and conditions of approval is
envisaged and that new location/space is within territorial
jurisdiction of DC /Designated Office

h) Extend validity period of LoP beyond initial validity period of LoP

(except in case where there is a restriction on initial period of
approval, like setting up of oil refinery projects) as per Paragraph
6.05 (a) of FTP;

i) Cancel LoP wherever warranted;

j) Permit merger of two or more units into one unit provided units
fall within jurisdiction of same DC / Designated Officer subject to
condition that activities are covered under provision of broad
banding;

k) Exercise powers of adjudication under Section 13 read with

Section 11 of FT (D&R) Act, in respect of EOUs as mentioned in

pg. 151
 Gazette Notification No. SO. 194(E) dated 6.3.2000;

l) Do valuation of exports declared on SOFTEX form by EOUs as per

RBI A.D. (M.A Series) Circular AP (DIR series Circular No.9 dated
25.10.2001);

m) Issue eligibility certificates for grant of employment visa to low

level foreign technicians to be engaged by EOUs as per Ministry of
Home Affairs letter No. 25022/7/99-F.1 dated 20.9.1999;

n) Registration-cum-Membership Certificate Function as a

Registering authority for EOU / EHTP / STP / BTP unit. A
separate Registration–cum–Membership Certificate shall not be
required in their cases as provided for in Paragraph 2.56 of FTP ;

o) Green Card Issue of Green Card automatically after execution of

LUT;

p) Grant / renewal of Status Certificate in respect of EOUs provided

it does not involve clubbing of FOB value of exports of its parent
company in DTA;

q) Publicity of EOU / EHTP / STP / BTP Scheme under their

jurisdiction.

r) Exit from EOU/EHTP/STP/BTP Scheme (including grant of ‘in-

principle’ exit letter as per Appendix 6K).

6.35 Change of Location / Inclusion of Additional Location with BOA

Approval
BOA may consider change of location of EOU / EHTP / STP / BTP unit from
place mentioned in LoP to another and / or to include additional location
outside territorial jurisdiction of original DC / Designated Officer, subject to
such conditions as BOA may decide.

6.36 Clearance of Capital Goods in DTA

Clearance of capital goods, including second hand, in DTA shall be allowed as
per para 6.14(b) of FTP and import policy in force on date of such clearance.

6.37 Depreciation Norms

Depreciation up to 100% is permissible for Computers and Computer

pg. 152
 peripherals in 5 years and 10 years in case of other items.
(a) Depreciation Norms for Computers and Computer Peripherals:
Depreciation for computers and computer peripherals shall be as follows.
10% for every quarter in first year;
8% for every quarter in second year;
5% for every quarter in third year;
1% for every quarter in fourth and fifth year.

(b) Depreciation Norms for Other Capital Goods:

For capital goods, other than above, depreciation rate would be as follows:

4% for every quarter in first year;

3% for every quarter in second and third year;

2.5% for every quarter in fourth and fifth year;

2% for every quarter thereafter.

6.38 Conversion
a) Existing DTA units, may also apply for conversion into an EOU
/EHTP / STP / BTP unit, but no concession in duties and taxes
would be available under scheme for plant, machinery and
equipment already installed. For this purpose, DTA unit may
apply to DC / Designated Officer concerned in same manner as
applicable to new units. In case there is an outstanding export
commitment under Advance Authorisation Scheme, it will follow
the procedure laid down in Appendix 6M of Appendices & ANFs.
In case DTA unit has taken EPCG authorisation, the conversion
would be permitted only if either the unit has fulfilled the
stipulated Export obligation and obtained EODC or has made
payment of applicable duties and taxes and compensation cess on
capital goods imported under the EPCG Scheme.
b) Existing EHTP / STP / BTP units may also apply for conversion /
merger to EOU unit and vice-versa. In such cases, units will
continue to avail permissible exemption in duties and taxes as
applicable under relevant scheme. EHTP / STP/ BTP units
desiring conversion as an EOU may apply to DC concerned
through Officer designated by MeitY / DoBT in same manner as

pg. 153
 applicable to new units. Likewise, EOU desiring conversion into
EHTP / STP / BTP may apply to officer designated by MeitY /
DoBT through DC concerned.
c) An EOU may be shifted to SEZ with approval of DC provided EOU
has achieved pro-rata obligation under EOU scheme.

6.39 Fast Track Clearance Procedure

a) Eligibility: EOUs having a status holder certificate under FTP shall
be eligible forFast Track Clearance Procedure.
b) Examination of Import Cargo: Status holder units shall be
exempted from examination of import cargo at port of import.
However, jurisdictional Commissioner of Customs may examine
consignments at unit’s place on random basis.
c) Installation of Computers: Eligible EOUs may install two
computers in their administrative / registered office outside
premises of the unit under prior intimation to jurisdictional Asstt.
/ Deputy Commissioner of Customs.
d) Procurement of DG sets: Procurement of DG set of capacity
commensurate with actual requirement of unit shall be permitted
under intimation to DC and jurisdictional Customs authority.
e) Temporary removal of Capital Goods: Eligible EOU may remove
their capital goods or parts thereof for repairs under prior
intimation to jurisdictional Asst. / Deputy Commissioner of
Customs or Central Excise.
f) Personal carriage of samples: Personal carriage of samples of
Gems & Jewellery by status holder EOUs are allowed subject to
limit fixed in Paragraph 6.24 without a need for prior permission
from DC / Customs.
g) Activities which do not require permission: In respect of following
activities of a status holder, permission will not be required from
DC or jurisdictional Central Excise/Customs authority: DTA sale of
finished products in terms of Paragraph 6.07(a) of FTP;
Participation in exhibition and Personal carriage of Gems &
Jewellery for export promotion tours subject to fulfilment of
conditions of Paragraph 6.23 of HBP. However, prior intimation
thereof needs to be given.

6.40 Time Bound Disposal of Applications

DC shall dispose of applications expeditiously. Following time schedule shall
pg. 154
normally be followed to dispose of applications provided application is
complete in all respects and is accompanied with prescribed documents.

S. Category of Application Time limit

No. for disposal
(days)
1 Issue of LoP / LoI 15
2 Conversion of LoP / LoI 15
3 Acceptance of LUT 3
4 Renewal of LUT 3
5 Permission for broad banding / Diversification 3
6 Permission for change in locations 7
7 Permission for Advance DTA sale 2
8 Permission for merger of units 7
9 Permission for enhancement of production capacity 3
10 Cancellation of LoP 3
11 Permission for debonding / exit 7
12 Permission for DTA sale 2
13 Eligibility certificate for employment visa for lower 2
leveltechnicians
14 Issue of Green Card 2
15 Renewal of Green Card Same
Day
16 Permission to lease CG 1
17 Permission for disposal of scrap / waste 2
18 Permission for change in name 2
19 Inter Unit Transfer 2
20 Wastage Norms, ad-hoc 2
21 Permission for re-import Same
day
22 Permission for re-export Same
day
23 Permission for replacement / repair of goods Same
day
24 Authorisation of softex form 1
25 Reimbursement of CST claims 7
26 Issue of GSP Certificate Same
day
27 Permission for conversion of EOU to STPI/EPCG 5
28 Permission of final exit of EOU 5
29 Permission of extension of EOU 2
30 Permission to allow increase in value of CG 2
pg. 155
31 Permission for export through exhibition / tour 2
32 Reimbursement of Duty Drawback / TED 7

pg. 156
CHAPTER 7

Deemed Exports
 Chapter-7
Deemed Exports
7.00 Policy
Policy relating to Deemed Exports is given in Chapter 7 of FTP.

7.01 Procedure for claiming Benefits

(a) Supplier / Recipient of goods shall submit application for claiming
deemed export benefits, in ANF-7A, along with the documents prescribed
therein, to the concerned RA.
(b) In case of supply of goods to an EOU, claim shall be filed with the
concerned Development Commissioner. A DTA Unit shall claim benefits
from the concerned RA.

7.02 Criteria for claiming Benefits

(a) (i) In respect of supply of intermediate goods to Advance
Authorisation / DFIA holder, against Invalidation Letter, issued in
terms of Paragraph 4.13 of HBP, application to obtain Advance
Authorisation for import of duty free inputs, as provided under
Chapter 4 of FTP, shall be made as per procedures given in Chapter
4 of HBP. For supplies against invalidation letter, TED refund shall
be given in accordance with para 7.03(c) of FTP, provided, there is
no exemption.
(ii) In respect of supply of goods to Advance Authorisation / DFIA,
against ARO, procedure given in Chapter 4 of the HBP shall be
followed. TED refund for supplies against ARO shall be allowed in
accordance with para 7.03(c) of FTP, provided, there is no
exemption. Duty Drawback shall be allowed in accordance with para
7.06 of FTP.
(b) In respect of supply of goods to EOU / EHTP / STP / BTP, Advance
Authorisation / DFIA can be obtained as per procedure given in the
Chapter 4 of HBP for exemption from payment of Terminal Excise Duty,
procedure as per Excise Circular number 851/9/2007-CX dated 3.5.2007
read with circular No. 10/2009- Cus dated 25.2.2009, shall be followed for
removal of goods against CT-3. TED refund shall be given for supply of
goods to EOU / EHTP / STP / BTP in accordance with para 7.03(c) of FTP,
provided, there is no exemption. In case Advance Authorisation, as
pg. 158
 provided in Chapter 4 of FTP, is not obtained for import of duty free inputs
against such supply, drawback claim for basic custom duty paid on inputs,
used in the resultant product, shall be filed with the DC concerned. A DTA
Unit shall claim benefits from the concerned RA.
(c) In respect of supply of goods to an EPCG Authorisation holder,
against Invalidation Letter, application for Advance Authorisation / DFIA
shall be made as per procedures given in Chapter 4 of HBP. If Advance
Authorisation / DFIA is not obtained for duty free inputs, Duty drawback
shall be allowed on basic custom duty paid on inputs used in the resultant
product.
(d) In respect of supply of goods to other categories as listed in the
Paragraph 7.02 (d), (e), (f) & (g) of FTP, Advance Authorisation / DFIA for
import of duty free inputs as provided under Chapter 4 of FTP may be
obtained against Project Authority Certificate as per Appendix-7C.
However, if Advance Authorisation / DFIA is not obtained against such
supplies for duty free inputs as provided in Chapter 4 of FTP, claim for
duty drawback for basic custom duty may be filed as per ANF-7A. TED
refund for projects mentioned in para 7.08(iii)(a) of FTP in respect of
eligible items of supply covered under schedule IV of Central Excise Act,
1944, shall be available provided there is no exemption.

7.03 Eligibility criteria for claiming TED / Drawback

(a) Application can be filed either by supplier or by recipient of goods,
having IEC Number.
(b) Application can be made by Registered office / Head office or
Manufacturing unit.
(c) In case supplier files claim for TED refund, it shall obtain a
certificate for non- availment of CENVAT credit from the recipient of goods
as per Annexure-I to ANF-7A and submit the same. In case recipient of
goods is an applicant, then the applicant itself shall submit such certificate.
(d) In case recipient unit files claim for TED / Duty Drawback,
disclaimer certificate as prescribed in the Annexure-III to ANF-7A shall be
obtained from supplier and shall be submitted along with the application.
In case supplier of the goods is an applicant then the disclaimer certificate
from the recipient of the goods shall be submitted.
(e) Claim can be filed only after payment is received in full, to the extent
of supplies made.

pg. 159
 (f) Claim can be filed against payment received through normal
banking channel, as per e-BRC. In other words, supply documents have to
be negotiated through bank only. In respect of supplies covered under
Paragraph 7.02 (d) to (g) of the FTP, payment certificate issued by Project
Authority, in Appendix-7D, has also to be submitted.
(g) Sub-contractor can also file claim provided its name is endorsed in
the Project Authority Certificate / Contract before supply of such goods.

7.04 Procedure for claiming TED refund on Fuel

For supply of High Speed Diesel (HSD) from Depots of domestic oil Public Sector
Undertakings under Paragraph 7.02(b) of FTP, terminal excise duty shall be
refunded on the basis of duty paid certificate issued by concerned domestic oil
Public Sector Undertaking in the format given in Annexure-IV to ANF-7A. Duty
refund will be allowed for quantity of HSD procured by EOU / EHTP / STP / BTP
unit for its production activities, as certified by concerned DC / Bond authorities.

7.05 Frequency of application and time period for claiming TED /

Drawback
(a) In respect of supplies covered in Paragraphs 7.02 (a) to (c) of FTP,
application for TED refund / drawback (whichever applicable) may be
filed within 12 months from the date of realisation of 100% payment
against such supplies. In cases where payment is received in advance and
supply is made subsequently, in such cases application can be filed within
12 months from the last date of such supplies. Claim can be filed
‘Invalidation Letter / ARO wise’ against individual Authorisation within
the time limit as specified above.
(b) In respect of supplies covered in Paragraphs 7.02 (d) to (g) of FTP,
claim may be filed either on the basis of proof of supplies effected or
payment received. Claims should be filed within a period of twelve months
from date of receipt of supplies by project authority or from date of receipt
of the payment by supplier as per the option of applicant, either against a
particular project or all the projects. Claims may also be filed where part
payments have been received. Deemed export benefits may be allowed
after 100% supplies have been made. However, benefit will be limited to
the extent of payment received.

7.06 Rate of Drawback

Normally drawback may be allowed as per All Industry Rate fixed by DoR in the
Drawback Schedule where no CENVAT credit has been availed by supplier of

pg. 160
goods. However, an application in ANF-7A, along with documents prescribed in
ANF-7A & Appendix-7E, may be made to RA or DC concerned, as the case may be,
for fixation of brand rate where All Industry Rate of Drawback is not available or
same is less than 4/5th of duties actually paid on raw materials or components
used in the production or manufacture of the said goods.

7.07 Time barred / supplementary claim

In case claim is filed after prescribed time period, provision of late cut, under
Paragraph 11.02 of HBP and provision of supplementary claim under Paragraph
11.03 of HBP shall be applicable.

7.08 Exemption from payment of TED

For claiming exemption from payment of terminal excise duty, wherever
applicable, procedure prescribed by Central Excise Authority shall be followed.

7.09 Applicability of other Rules

Subject to procedure laid down in HBP, Customs and Central Excise Duties and
Service Tax Drawback Rules, 1995 or Customs and Central Excise Duties
Drawback Rules, 2017, as the case may be, shall apply mutatis mutandis to
deemed exports scheme.

7.10 Payment of interest

(a) RA shall make payment within 30 days from the date of issuance of
Approval Letter. In case payment is not made within the time period as
given above, then RA shall add interest component, along with principal
amount, in accordance with paragraph 7.09 of the FTP. No separate
application for claiming interest is required to be made. A single mandate
shall be issued to the bank for principal amount and interest.
(b) If interest is not added by RA/DC, a separate application, as per
ANF-7B may be filed, within 30 days from the date of receipt of principal
amount. No interest shall be paid thereafter. RA shall maintain separate
account for disbursement of principal amount and interest for accounting
purpose.
(c) RA shall submit a monthly report regarding disbursement of
deemed exports claims, in the proforma as given in Appendix-7F.
Wherever interest is paid, RA shall inform the reason for payment of
interest.

pg. 161
7.11 Internal Audit Mechanism
The zonal offices of Additional DGFT shall constitute Audit team in their offices as
per paragraph 7.10 of FTP and shall carry out post Audit.

pg. 162
CHAPTER 8

Quality Complaints
and Trade Disputes
 Chapter-8
Quality Complaints and Trade Disputes

8.01 Committee on Quality Complaint & Trade Dispute (CQCTD)

For effective dealing of quality complaints and trade disputes, a Committee on

Quality Complaint & Trade Dispute (CQCTD) is constituted in the 20 offices of
the DGFT. Name of the office, where CQCTD has been constituted and
jurisdiction of CQCTD is given in the table below:

Sl. Location of Designation of Jurisdiction of the CQCTD

No. CQCTD Chairperson
Northern Zone
1 Addl. DGFT, CLA, Addl. DGFT CLA, New Delhi
New Delhi
2 Jt. DGFT, Panipat Jt. DGFT RA, Panipat
3 Jt. DGFT, Jt. DGFT RA, Jaipur
Jaipur
4 Jt. DGFT, Kanpur Jt. DGFT RA, Kanpur
5 Addl. DGFT, Addl. DGFT RA, Ludhiana; RA, Jammu
Ludhiana and RA, Srinagar
6 Jt. DGFT, Varanasi Jt. DGFT RA, Varanasi
Western Zone
7 Addl. DGFT, Addl. DGFT RA, Mumbai and RA, Nagpur
Mumbai
8 Jt. DGFT, Pune Jt. DGFT RA , Pune
9 Dy. DGFT, Jt. DGFT RA, Vadodara
Vadodara
10 Addl. DGFT, Addl. DGFT RA, Ahmedabad
Ahmedabad
11 Jt. DGFT, Surat Jt. DGFT RA, Surat
12 Jt. DGFT, Indore Jt. DGFT RA, Indore and RA, Bhopal
13. Jt. DGFT, Rajkot Jt. DGFT RA, Rajkot
Eastern Zone
14 Addl. DGFT, Addl. DGFT RA, Kolkata and RA,
Kolkata Guwahati
Southern Zone
15 Addl. DGFT, Addl. DGFT RA, Chennai
Chennai
16 Addl. DGFT, Addl. DGFT RA, Bangalore
Bangalore
17. Addl. DGFT, Addl. DGFT RA, Hyderabad

pg. 164
 Hyderabad
18 Jt. DGFT, Jt. DGFT RA, Coimbatore
Coimbatore
19 Dy. DGFT, Dy. DGFT RA, Vishakhapatnam
Vishakhapatnam
20 Jt. DGFT Cochin Jt. DGFT RA, Cochin

8.02 Composition of the CQCTD

The CQCTD may comprise the following members:

1. Additional DGFT/Joint DGFT/ (H.O.O):Chairperson

2. Representative of Bureau of India Standard (BIS):Member
3. Representative of Agricultural and Processed Food Products Export
Development Authority (APEDA): Member
4. Representative of the Branch Manager of the concerned Bank:
Member
5. Representative of Federation of Indian Exporter Organisation
(FIEO)/ and OR Export Promotion Council/Commodity Boards:
Member
6. Representative of Export Inspection Agency: Member
7. Nominee of Director of Industries of State Government: Member
8. Nominee of Development Commissioner of MSME: Member
9. Officer as nominated by Chairperson: Member Secretary
10. Any other agency, as co-opted by Chairperson: Member.

8.03 Online Filing and Tracking of Quality Complaints/Trade

Disputes
A request for investigation and settlement of quality complaint/trade dispute
would be filed online by an Indian/foreign entity at
“www.dgft.gov.in>Services>Quality Complaints & Trade Disputes>fill Online
Application Form”. Such complaint would be submitted online to the
jurisdictional Regional Authorities of DGFT as well as to the concerned Indian
Mission. On submission, a Unique Reference Number will be generated and sent
to the email id of the complainant. The complainant can also upload supporting
documents along with the complaint or later on.

8.04 Mechanism for resolving Quality Complaints/Trade Disputes

i. CQCTD in the Regional Authorities of the DGFT would take up the matter
with the concerned entity or authorities in their jurisdiction for resolving
the complaint and would update status online on a regular basis,

pg. 165
 ii. Wherever necessary, action would be taken against the erring Indian
Entity under the Foreign Trade (Development & Regulation) Act, 1992, as
amended and the Foreign Trade (Regulation) Rules, 1993, as amended,
iii. The Indian Missions would take up the issue with authorities concerned
for resolving the complaint and would update status online on regular
basis,
iv. The facility of tracking and viewing status of the complaints/disputes by
the complainant has also been provided on the DGFT website.

8.05 Choice to pursue other options

This mechanism is to provide an additional window for resolution of
complaints/disputes to create confidence in business environment in the
country. Efforts would be made to resolve the complaints amicably and
expeditiously. However, this mechanism is only conciliatory in nature. The
aggrieved parties are free to pursue any other course of action including legal
action against the erring party. Disputes between two Indian parties or between
two foreign parties are not covered under this mechanism.

pg. 166
CHAPTER 9

Promoting Cross
Border Trade in
Digital Economy
 Chapter-9
Promoting Cross Border Trade in Digital Economy

9.00 Policy

The given chapter elaborates on the procedures in relation to the Policy as

notified under ‘Cross Border E-Commerce from India’ i.e., Chapter 9 of the
Foreign Trade Policy.

9.01 Foreign Trade Policy Benefits/Schemes to e-Commerce

Exporters

Suitable IT enablement shall be undertaken to ensure seamless delivery of

Foreign Trade Policy Benefits/Schemes to e-Commerce Exporters.

9.02 E-COMMERCE EXPORT HUBs (ECEHs)

a) Creation of ECEH

i. Application for creation/notification of an ECEH area shall be made

to the DGFT.

ii. The authority for approval for an ECEH vests with the DGFT. DGFT
shall constitute a committee for evaluation of ECEH applications. The
Committee shall have a member from the Department of Revenue besides
any other members as required from time-to-time.

iii. DGFT may specify export products or markets, which shall not be
eligible for ECEH operations. The negative list of items that cannot be dealt
within the ECEHs shall be notified separately.

b) Administration of ECEH

i. The ECEH developer shall provide an annual statement of accounts as

per instructions in this regard.

ii. DGFT shall notify procedures for supervision and inspections at

ECEHs. An independent evaluation and assessment mechanism may also be
developed.

pg. 168
CHAPTER 10

SCOMET: Special
Chemicals, Organisms,
Materials, Equipment
and Technologies
 Chapter-10
SCOMET: Special Chemicals, Organisms,
Materials, Equipment and Technologies

10.00 Policy
Policy relating to general provisions governing the export of dual use items,
munitions and nuclear related items, including software and technology, viz.
SCOMET, is specified in Chapter 10 of FTP.

10.01 Coverage
This chapter covers the procedure for various applications relating to export of
dual use items under SCOMET.

10.02 SCOMET categories and licensing jurisdiction

Export of dual use items, munitions and nuclear related items, including software
and technology, covered under SCOMET list are permitted against an export
authorisation, unless prohibited or specifically exempted. Licensing authorities
for various categories of SCOMET items, as specified in Appendix 3 to Schedule 2
of ITC (HS) and tabulated under Para 10.03 of FTP are as under:
(a) The DGFT is the licensing authority for all SCOMET categories, including
Sub-category 6A007, 6A008, except Categories 0, 6, Note 2 of Commodity
Identification Note (CIN) of SCOMET list, and any other sub-category as
may be specified.
(b) The Department of Atomic Energy (DAE) is the licensing authority for
items in Category 0 and Note 2 of the 'CIN’. Applicable guidelines are
notified by the DAE for Nuclear Transfers (Exports) and Notification of
schedule of Prescribed Substances, Prescribed Equipment and
Technology" issued under Atomic Energy Act 1962 and Atomic Energy
(Working of Mines, Minerals and Handling of Prescribed Substance) Rules
1984. For certain items in Category 0, formal assurances from the recipient
State will include non-use in any nuclear explosive device. Authorisations
for export of certain items in Category 0 will not be granted unless transfer
is under adequate physical protection and is covered by appropriate
International Atomic Energy Agency (IAEA) safeguards, or any other
mutually agreed controls on transferred items.
(c) The Department of Defence Production (DDP) in the Ministry of Defence is
the licensing authority for items in Category 6 of SCOMET known as
‘Munitions List’ [except those covered under Note 2 of CIN to SCOMET and
pg. 170
 Note 3 of Munitions List (i.e. items under Category 6A007, 6A008)]
irrespective of end use of the items, whether military or civil. Export
Authorisation under Category 6 of SCOMET is granted by the DDP as per
their extant guidelines/Standard Operating Procedure (SOP), to be issued
from time to time.

10.03 Supply of SCOMET Items from DTA to SEZ/EoU and outside

the country
No export authorisation is required for supply of SCOMET items from DTA to
SEZ/EOU. Export Authorisation is, however, required if the SCOMET items are to
be physically exported outside the country from SEZ/EOU, i.e. to another country
(Refer Rule 26 of the SEZ Rules, 2006). All supplies of SCOMET items from DTA to
SEZ/EOU will be reported to the Development Commissioner (DC) of the
respective SEZ/EoU by the supplier in the prescribed proforma [Annexure 1 to
Appendix-3 to Schedule 2 of ITC (HS) Classifications of Export and Import Items]
within one week of the supplies getting effected. An annual report of such
supplies from DTA to SEZ/EOU shall be reported to DGFT (Hqrs), by the DC of
SEZ/EOU in the prescribed proforma [Annexure 2 to Appendix-3] by 15thMay of
every financial year, in respect of supplies from DTA to SEZ/EOU during the
preceding financial year.

10.04 Application and Documentation for SCOMET

Authorisation
(a) An application for grant of Export Authorisation in respect of SCOMET
items, including software and technologies mentioned in Appendix 3 to
Schedule 2 of ITC (HS) Classifications of Export and Import Items may be
made in prescribed proforma [ANF 10A, ANF-10B, ANF-10C, ANF-10D,
ANF-10E, ANF-10F] as may be applicable, to the DGFT (Hqrs) along with
documents as prescribed in relevant Appendices.
(b) However, such applications are mandatorily to be filed through online
system under the icon Services –> Export Management System –> SCOMET
on the website of DGFT.
(c) While submitting the online application, all the required documents as
applicable and specified in relevant Appendices are to be uploaded as PDF
files. Manual submission of application with DGFT (HQ) is dispensed.
However, original End User Certificate(s) as per the applicable format
(specified in relevant Appendix) or Legal Undertaking for temporary
exports is/are to be submitted in hard copy along with covering letter
clearly indicating file number of application on subject line to SCOMET Cell
of DGFT (HQ), Vanijya Bhawan, New Delhi, besides electronic submission.

pg. 171
(d) Application shall be accompanied by an EUC as per the applicable format
(relevant Appendix), certifying that:
 The item will be used only for stated purpose and that such use will
not be changed, nor items modified or replicated without consent of
Government of India;
 Neither the items nor replicas nor derivatives thereof will be re-
transferred without consent of Government of India;
 End-user shall facilitate such verifications as are required by
Government of India.
(e) The end-user certificate will indicate the name of the item to be exported,
the name of the importer and all the entities in the supply chain, the
specific end-use of the subject goods, details of Purchase Order/Contract,
etc.
(f) Government of India may also require additional formal assurances, as
deemed appropriate, including those on end-use and non-transfer, from
the State of the recipient.
Additional end-use conditions may be stipulated in Authorisations for export of
items, including software and technology, based on an assessment of
proliferation concerns and other factors.

10.05 Additional controls on Non-SCOMET items for dual use

(Catch-all controls)
If the exporter has been notified in writing by DGFT or he knows or has reason to
believe that an item not covered in the SCOMET list has a potential risk of use in
or diversion to Weapons of Mass Destruction (WMD) or in missile system or
military use (including by terrorists and non-state actors), he shall apply for a
SCOMET authorisation. The export of such an item may be denied or permitted as
per the procedure provided for SCOMET items in Paragraph 10.06 of HBP.
Note: “Military use” shall mean incorporation into items listed under SCOMET
Category 6 or for the use, development, or production of military items listed in
this category.

Exporter who is going to export/transfer such items regulated under Catch-all

Controls is required to obtain a SCOMET license from DGFT. IMWG examines
such applications filed in prescribed proforma [ANF 10A] alongwith relevant
documents in terms of Para 10.06 of HBP.

pg. 172
10.06 Inter Ministerial Working Group (IMWG)
An Inter-Ministerial Working Group (IMWG) in DGFT (Hqrs.) comprising
representatives of other Ministries / Departments / Organisations of the
Government of India, as considered appropriate, shall consider applications for
export of SCOMET items as specified in Appendix-3 to Schedule 2 of ITC (HS)
Classifications of Export and Import Items based on the following guidelines /
factors:
I. Applications for Authorisation to export items or technology or software
on SCOMET List are considered on the basis of following general criteria:
(a) Credential of end-user, credibility of declaration of end-use of the item
or technology, integrity of chain of transmission of item from supplier
to end-user, and on potential of the item or technology, including timing
of its export, to contribute to end-uses that are not in conformity with
India’s national security or foreign policy goals and objectives, goals
and objectives of global non-proliferation, or India’s obligations under
International Treaties/Agreements/Conventions to which it is a State
party.
(b) Assessed risk that exported items will fall into hands of terrorists,
terrorist groups, and non-State actors;
(c) Export control measures instituted by the recipient State;
(d) Capabilities and objectives of programmes of the recipient State
relating to weapons and their delivery;
(e) Assessment of end-use(s) of item(s);
(f) Applicability of provisions of relevant bilateral or multilateral
Agreements and Arrangements, to which India is a party, or adherent.
This is including but not limited to the control lists of the Nuclear
Suppliers Group, Missile Technology Control Regime, Australia Group
(and its Warning List or Awareness Raising Guidelines) and Wassenaar
Arrangement (and its Sensitive List and Very Sensitive List) as
amended from time to time;
II. Timeline for comments/NOC by IMWG members: The members of IMWG
will endeavour to furnish their written comments/views/no objection to
DGFT within 30 days from the date of forwarding of online application by
DGFT (Hqrs.). If no comments/views/no objection is received within the
stipulated period, the cases will be placed before IMWG for taking a decision
as deemed appropriate.
III. The IMWG shall normally meet once every month. Where a case has been
deferred in the IMWG meeting and subsequently comments/views/NOC(s)
are received from all concerned agencies with no divergence in views,
authorisation shall be issued with the approval of Chairman, IMWG and the
case shall be brought before IMWG in its subsequent meeting for approval
on ex-post facto basis.

pg. 173
IV. Case(s) where a decision could not be arrived at in IMWG shall be placed
before Director General of Foreign Trade for appropriate decision on grant
of authorisation.
After the approval of SCOMET application by the IMWG or Chairman, IMWG, as
the case may be, export authorisation shall be issued by the SCOMET Cell in DGFT
(Hqrs).

10.07 Applicability of Weapon of Mass Development Act (WMD Act)

Export of items not on SCOMET List may also be regulated under provisions of
the Weapons of Mass Destruction and their Delivery Systems (Prohibition of
Unlawful Activities) Act, 2005.

10.08 Procedure/ Guidelines for filing / Evaluation of Applications

for Entering into an Arrangement or Understanding for Site Visits,
On-site Verification and Access to Records /Documentation
An application for entering into an arrangement or understanding involving site
visit, on-site verification or access to records/documentation by a foreign
government or a foreign third party either acting directly or through an Indian
party as mentioned in Appendix 3 of Schedule 2 of ITC (HS) Classifications of
Export and Import Items shall be made to DGFT (Hqrs.), New Delhi, in proforma
ANF 10E along with relevant documents as prescribed therein, including
Appendix 10L. These applications shall be considered by IMWG in DGFT (Hqrs.)
based on the guidelines/general criteria as specified in Appendix-10A and
permission for arrangement or understanding involving site visit, on-site
verification or access to records / documentation will be subject to the
conditions specified in Appendix-10A.

10.09 Issue of authorisation for Repeat Orders of SCOMET item(s)

An application for grant of an Authorisation for repeat orders (excluding
Category 3A401 and software and technology under any category) for export of
same SCOMET items to the same country/entities shall be made in prescribed
proforma [ANF 10A] through online SCOMET portal along with other supporting
documents, as prescribed in Appendix 10B(i) and Appendix 10B(ii). The
application shall be considered by Chairman IMWG, without consultation with
IMWG members. However, in cases of repeat orders for export of same SCOMET
item to different country/entities approval will be granted by Chairman IMWG
after verification of credentials of foreign buyer/consignee/end-user only.
Subsequent to issue of export authorisation, the IMWG through relevant
agency(ies) may verify exports made under repeat orders, based on an
assessment of various factors.
pg. 174
The approval will be subject to the fulfilment of the following criteria:
(i) Same SCOMET items would imply that the products, along with the
technical specifications, are exactly the same for which export
authorisation has been issued to the applicant exporter earlier after due
consultation/verification;
(ii) Same country/entities would imply that (a) the foreign buyer (b) the
consignee or the intermediaries, if any (c) the end user and (d) the end use
are exactly the same for which export authorisation has been issued to the
applicant exporter earlier after due consultation/verification;
(iii) Only the applications submitted within three years from the date of Issue
of original SCOMET authorisation, after due verification/consultation
process, will be eligible for repeat authorisation;
(iv) The cumulative quantity permitted against repeat export authorisations
shall be commensurate with the operational capacity of the end user in
respect of the relevant product, as certified by the end user. A certificate to
this effect from the end user on prescribed proforma [Appendix
10B(i)]shall be submitted by the exporter along with the application for a
repeat authorisation;
(v) A declaration by the authorized signatory of the exporter firm on the
qualifying conditions as per (i) to (iv) above shall be submitted on
prescribed proforma [Appendix 10B(ii)] along with the application for
consideration under the repeat order route;
(vi) The authorisations(s) for repeat orders shall be liable for
recall/termination by the DGFT on receipt of an adverse report in respect
of any of the export consignments;
(vii) All authorisations for repeat orders shall be brought before IMWG in its
subsequent meeting for confirmation of approval, on ex-post facto basis,
and the IMWG would reserve its right to refuse further repeat
authorisations based on its assessment of proliferation concerns;

10.10 Issue of export authorisation for "Stock and Sale" of SCOMET

items
Application for grant of authorisation for bulk export of SCOMET items
(excluding Category 0, Category 3A4001, Category 6 and transfer of technology
under any category) from an Indian exporter to an entity abroad (hereinafter
referred to as ‘stockist’) for subsequent transfer to the ultimate end users shall
be considered by IMWG, on the following conditions:
Applicability and scope of policy

a. ‘Stockist’ refers to the entity abroad to whom the SCOMET items are originally
exported by Indian principal/wholly owned subsidiary. The Stockist entity
should be a subsidiary/principal company abroad of the Indian exporter;

pg. 175
b. Export shall be permitted from the Indian parent company (applicant
exporter) to its foreign subsidiary company or from the Indian subsidiary of
foreign company (applicant exporter) to its foreign parent/another
subsidiary of foreign parent company and; on the basis of an End Use
declaration from the stockist, through the specified End User Certificate
(EUC)for 'stock & sale' purpose;

Note: IMWG may relax the provisions of a. and b. above in certain cases,
considering the description/end use/end user of the item.
Application for export to stockist abroad and transfer to end users in specific
countries

c. The exporter shall submit application in prescribed proforma (ANF-10B)

along with following documents from the stockist:

i. Documentary proof regarding corporate relationship between the

Indian exporter and stockist;
ii. End-use/End-user Certificate from stockist entity abroad in Appendix-
10J(iii)
iii. List of countries (in the EUC) to which the items imported from India
would be exported by the stockist;
iv. Purchase Order(s)/Invoice(s) or a document in lieu thereof;
v. Technical specifications of the product(s);
vi. Copy of Internal Compliance Program (if applicant exporter/ stockist
entity has one)

In-principle approval for export to the stockist, and, for sale by stockist within
the country of the stockist, and, for re-export by stockist to end user in other
countries

d. The application would be assessed for grant of authorisation for export to the
stockist, and, for grant of in-principle approval for re-export to specified
countries of ultimate end use approved by the IMWG;
e. No authorisation would be required for transfer from the stockist to the
ultimate end user(s) within the country of the stockist and for re-export to
end users in such approved countries;
f. Re-export to such approved countries would be subject to the export control
regulations of the country of the stockist;
g. Country would denote an independent sovereign entity which is a distinct
national entity in political geography. Hence, transfers within an economic
union or a customs union would not qualify as “same country transfers”;

Post-reporting for same country transfer and re-export to pre-approved

countries by the stockist

pg. 176
h. In case of sale/transfer by the stockist within the same country and for re-
export/re-transfer to the end users in countries, for which, in-principle
approval has been granted, the Indian exporter/licensee shall submit details
of all such transfers to SCOMET Division of DGFT (Hqrs) in ANF-10B,
including EUCs[Appendix-10J(i), 10J(ii)as applicable] from all ultimate end
users and Bill of Entry into the ultimate destination countries(for export
outside the country of stockist), within 3 months of every such transfer;

Application for re-export to other countries (other than pre-approved)

i. In respect of re-export/re-transfer of items from the stockist entity to the end

users outside the country of the stockist, for which, in-principle approval has
not been granted at the initial stage, the Indian exporter (stock and sale
authorisation holder) shall submit application for re-export/re-transfer to
SCOMET Division in DGFT (Hqrs), in ANF 10B, through email (scomet-
[email protected]), after obtaining following documents from the stockist entity:
(i) End-use/End-user Certificate from each link in the supply chain as per
Appendix-10J(i), 10J(ii), as applicable;
(ii) Purchase Order(s)/Invoice(s) or a document in lieu thereof ;
(iii) Technical specifications of the product to be transferred (only if
there is any value addition in the product by the stockist)

j. IMWG shall consider export authorisations for allowing such re-export/re-

transfer based on end use/end user verification;

Repeat Order cases

k. Applications for export of same SCOMET items to same stockist entity, and re-
export/re-transfer of same SCOMET items from the stockist entity to the end-
users (within the country of stockist entity and only the countries of ultimate
end use where in-principle approval has been granted), i.e. repeat orders,
shall be considered by Chairman IMWG, without any consultation with IMWG
members;

Annual reporting on inventory of the stockist and transfers/re-exports

l. The Indian exporter (Stock & Sale Authorisation holder) shall submit a
statement of exports made from India to the stockist, transfers made by the
stockist to the final end-users and inventory with the stockist, as on 31st
December of each calendar year, by 31st January of the following year. A
failure to do so may entail imposition of penalty and /or cancellation of
authorisation under the stock and sale policy;
m. The items exported to the stockist entity under the stock and sale
authorisation should be transferred to the final end-user(s) within the validity
period of the authorisation as in paragraph 10.17 of HBP;

pg. 177
n. The authorisation may be revalidated as per the procedure mentioned in
paragraph 10.20 of HBP;

10.11 Issue of export authorisation for spare parts of SCOMET items

under Stock and Sale
An applicant may also apply for export of spare parts, under stock and sale
arrangement in the application for export of main item/equipment along with
justification of the same. The request for export of spare parts covered under
SCOMET may be considered by IMWG along with the application for the main
item/equipment, on the same conditions, as applicable for the main
item/component. The applicant needs to indicate the requirement of spare parts
after judicious and reasonable assessment with justification thereof.

10.12 Issue of authorisations for repair/replacement of defective

SCOMET items
An application for grant of an Authorisation for export/re-export of SCOMET
items, as the case may be for (i) repair/replacement of imported item(s) abroad
and return (ii) repair/replacement of indigenous SCOMET items (iii) return of
items imported for repair at a repair facility in India and (iv) Authorisation for
export of SCOMET items after repair in india (GAER) shall be made in prescribed
proforma [ANF 10A] through online SCOMET portal along with other supporting
documents, as prescribed in Appendix 10D, 10E, 10F and 10F(i), as applicable.
The application shall be considered by Chairman IMWG, on fulfilment of the
following conditions:

A. Authorisation for export of imported SCOMET items for

repair/replacement:

i. Conditions to be fulfilled:
(a) The SCOMET items were imported to India and are to be exported
for the purpose of repair and replacement, on being defective;

(b) There has been no change to the original

characteristics/specifications of the SCOMET item(s);

(c) The SCOMET items are to be exported to the same entity from
which they have been imported or to the OEM (including,
agency1authorized by OEM);

1
Agency can include’ Approved Repair Centre’ (facility approved by the original equipment
manufacturer to repair the goods being exported under license).

pg. 178
 (d) That the replacement or repair of defective/damaged items
(whichever is applicable) is allowed under the conditions of
import or contractual agreement;

(e) No Export Authorisation would be granted if the initial export

authorisation has been suspended, modified or revoked by the
exporting country;

(f) No Export authorisation would be granted for UNSC sanctioned

destinations or countries/entities of high risk, as assessed by the
IMWG, from time to time; and

(g) No ‘End Use’ and ‘End Use Certificate’ would be required;

(h) The application is accompanied with relevant documents as

prescribed in Appendix 10D;

(i) Legal Undertaking on the stamp paper of Rs. 200/-, in prescribed

proforma (Appendix 10K).

ii. Applications for grant of authorisations for export to the entity from
which it was imported or to the OEM (including agency authorized by
OEM) shall be approved by Chairman IMWG, without any consultation
with IMWG members. However, in cases of export to any other entity,
approval will be granted by Chairman, IMWG after verification of the
credentials of the foreign entity to which the item(s) are to be exported.
iii. Return of item(s) after repair/replacement and post-reporting
compliance:
(a) Exported items shall be brought back to India within 90 days
repair is completed or item is replaced or within the extended
time, as allowed by the DGFT;

(b) In case the defective/damaged item(s) cannot be imported due

to any reason (beyond repair, testing failure analysis etc.),
evidence of destruction in the importing country shall be
submitted to DGFT within 90 days of export.

(c) In case time beyond 90 days is required for repair of imported

defective/damaged item(s) before re-import, permission from
DGFT shall have to be obtained in advance indicating detailed
justification for seeking extension of time.

pg. 179
 (d) Bill of Entry confirming the return back of such SCOMET item(s)
to India shall be intimated by the licensee to the DGFT(Hqrs) in
the prescribed proforma (Annexure-I of Appendix 10K), duly
signed in ink and stamped by the authorised signatory.

B. Authorisation for re-export of indigenous SCOMET items after

repair/replacement:
i. Conditions to be fulfilled:

(a) The SCOMET items manufactured in India, were exported and

brought back to India for repair or being replaced, on being
found defective/damaged;
(b) The items are to be re-exported after repair/replacement to the
same entity to which the item(s) were originally exported by the
applicant exporter;
(c) There has been no change to the original
characteristics/specifications of SCOMET item(s);
(d) That the defective/damaged item(s)has/have already been
brought back or would be brought back to India within 90 days
of its replacement(if applicable);
(e) That replacement/repair(whichever is applicable) is allowed
under the conditions of export or purchase order or contractual
agreement;
(f) No authorisation for re-export would be granted if the original
licence has been suspended, modified or revoked.
(g) No Export authorisation would be granted for UNSC sanctioned
destinations or countries/entities of high risk, as assessed by the
IMWG, from time to time; and
(h) No ‘End Use’ and ‘End Use Certificate’ would be required;
(i) The application is accompanied with relevant documents as
prescribed in Appendix 10E;

(j) Legal Undertaking on the stamp paper of Rs. 200/-, in prescribed

proforma (Appendix 10K).

ii. Applications for grant of authorisations to export the replaced/repaired

item(s) to/through the same entity(ies), as specified in the original
SCOMET license, shall be approved by Chairman IMWG, without any
consultation with IMWG members. However, in cases of export
to/through a new entity (consignee), approval will be granted by
Chairman, IMWG after verification of the credentials of the new foreign
entity(ies) through which the item(s) are to be exported.
iii. Return of item(s)after repair/replacement and post-reporting
compliance:
pg. 180
 (a) That the defective/damaged item(s)has/have already been
brought back or would be brought back to India within 90 days
of its replacement (in case of replacement);;

(b) In case the defective/damaged item(s)cannot be imported due to

any reason (beyond repair, testing failure analysis etc.), evidence
of destruction in the importing country shall be submitted to
DGFT within 90 days of export of replacement;

(c) Bill of Entry confirming the return back of such SCOMET item(s)
to India shall be intimated by the licensee to the DGFT(Hqrs) in
the prescribed proforma (Annexure-I of Appendix 10K), duly
signed in ink and stamped by the authorised signatory.

C. Authorisation for export of imported SCOMET items to same entity

abroad, or any authorised entity after repair in India:

i. Conditions to be fulfilled:
(a) The SCOMET items were imported to a designated/authorized
repair facility in India for the purpose of repair under a contract
agreement/Master Service agreement (MSA); or

Imported under a contract agreement between Indian exporter,

entities of repair facility (if different from exporter)and entity
abroad defining ‘Statement of Work (SOW)’/ ‘Scope of Work’
including conditions for undertaking repair in India;
(b) The items are to be exported to the same entity abroad from
which the item(s) has/have been imported or to the OEM
(including agency2 authorised by OEM);

(c) The repair of defective/damaged items is allowed under the

conditions of import or contractual agreement between Indian
exporter, entities of repair facility (if different from exporter)
and the entity abroad/OEM (including agency authorized by
OEM)(name and address);

2
Agency can include’ Approved Repair Centre’ (facility approved by the original equipment manufacturer to repair
the goods being exported under license).

pg. 181
 (d) There has been no change to the original
characteristics/specifications of the SCOMET item(s) after
repair;

(e) No Export Authorisation would be granted when the initial

export authorisation has been suspended, modified or revoked
by country of import;

(f) No Export authorisation would be granted for UNSC sanctioned

destinations or countries/entities of high risk, as assessed by the
IMWG, from time to time;

(g) No details of ‘End Use’ and ‘End Use Certificate’ would be

required;

(h) The application is accompanied with relevant documents as

prescribed in Appendix 10F;

ii. Applications for grant of authorisations for export to the entity from
which it was imported or to the OEM (including agency authorized by
OEM) shall be approved by Chairman IMWG, without any consultation
with IMWG members. However, in cases of export to any other entity,
approval will be granted by Chairman, IMWG after verification of the
credentials of the foreign entity to which the item(s) are to be exported.
All such authorisations shall be brought before IMWG in its subsequent
meeting for confirmation of approval, on ex-post facto basis.

D. Authorisation for export of same imported SCOMET items to same

entity abroad under General Authorisation for Export after Repair in India
(GAER)

A. Export of imported SCOMET items to the same entity abroad after

repair in India will be allowed on the basis of a onetime General
authorisation for Export after Repair in India (GAER) subject to post
reporting on quarterly basis issued by DGFT, subject to the following
conditions:

a. The SCOMET items were imported to a designated/authorized repair

facility in India for the purpose of repair under a contract
agreement/Master Service agreement (MSA); or Imported under a
contract agreement between Indian exporter, entities of repair facility
(if different from exporter) and entity abroad defining ‘Statement of
Work (SOW)’/ ‘Scope of Work’ including conditions for undertaking
repair in India;

pg. 182
 b. The items are to be exported to the same entity and location abroad
from which the item(s) has/have been imported;
c. The exporter is required to register and obtain General authorisation
for export after repair only once during the validity period. Subsequent
export/re-export is subject to post reporting;
d. The exporter is required to provide Bill of Entry for the imported item
while applying for GAER for the first shipment.
e. General authorisation for export after repair shall be valid for a period
of one year from the date of issue of General authorisation subject to
subsequent post reporting(s) within 30 days from the date of such
export;
f. Subsequent export would be allowed to the same entity and location to
which the license has originally been issued. Note: Same entity would
imply that (a) foreign buyer (b) consignee or intermediaries, if any (c)
the end user are exactly the same for which authorisation has been issued
to the applicant exporter.
g. There has been no change to the original characteristics/specifications
of the SCOMET item(s) after repair and no value addition has been
done during the repair work;
h. No Export Authorisation would be granted when the initial export
authorisation has been suspended, modified or revoked by country of
import;
i. No Export authorisation would be granted for UNSC sanctioned
destinations or countries/entities of high risk, as assessed by the
IMWG, from time to time;
j. No details of ‘End Use’ and ‘End Use Certificate’ would be required;
k. GAER issued for specific item and specific entity(buyer/end user) shall
not be applicable incase the re-export is of a different imported item or
to a different entity or Authorised OEM. In such cases, either a new
GAER authorisation may be applied or application may be filed under
Para 10.12(D) of HBP.
B. Documents Required for GAER
1. Proof of import of the item(s):
a. Export License (if applicable) issued by the foreign country for
original import of the items to India;
b. Documentary proof and/or self declaration that the item exempted
from license requirement or place under no license requirement
for India.

pg. 183
 c. Bill of Entry (first time)
2. Proof of obligation for repair of defective/damaged items:
Contract agreement and/or ‘Statement of Work (SOW)’/ Master Service
agreement (MSA) between Indian exporter and with the entity abroad
(from which the goods were imported initially) defining conditions for
undertaking repair in India.
An Undertaking from the Indian exporter;
An Undertaking from the applicant exporter (on the letter head of the
firm duly signed and stamped by the authorized signatory) stating:

a. Details of imported items to be exported after repair alongwith

their SCOMET Category /Sub-category number(s), quantity, item
description and ECCN of foreign country (if available) ;
b. That item(s) are being exported to the same entity from which it
was originally imported for repair and return purpose.
c. That there has been no change to the original
characteristics/specifications of the item(s) after import and no
value addition has been done during the repair work;
d. That the repair of defective/damaged items is allowed under the
conditions of import or contractual agreement between Indian
exporters and entities from which goods were imported.
e. That Shipping Bills and Bill of Entry into destination country of
subsequent re-exports and any other information as sought by
DGFT shall be submitted to DGFT on quarterly basis.
f. That items would not used for military applications or to develop,
acquire, manufacture, possess, transport, transfer or use, chemical,
biological, nuclear weapons or for missile capable of delivering
such weapons.
C. Post reporting for re-export of items/software/technology under
GAER
i. The Indian exporter shall submit post-shipment details of each
transfer/consignment of exports of SCOMET
items/software/technology under GAER to the SCOMET Division of
DGFT (Hqrs), New Delhi, via E-mail ([email protected]) or a
procedure as prescribed by DGFT, on quarterly basis
(March/June/September/December), by the end of subsequent
month of each quarter, in respect of the exports made in the
previous quarter.

pg. 184
 ii. The post-shipment details shall include submission of Bill of Entry
(wherever available), shipping bill details, valid export license copy
within the timelines mentioned above.
iii. Failure to do so may entail imposition of penalty and/or
suspension/revocation of GAER and action as per FTDR Act.

D. Suspension / Revocation
GAER issued shall be liable to be suspended / revoked by the DGFT on receipt
of an adverse report on proliferation concern or for non-submission of
mandatory reports /documents within the prescribed timelines or for non-
compliance with the conditions of this Public Notice.

E. General conditions
i. GAER would not be issued in case of items to be used to design, develop,
acquire, manufacture, possess, transport, transfer and / or used for
chemical, biological, nuclear weapons or for missiles capable of
delivering weapons of mass destruction and their delivery system;
ii. GAER would not be issued for countries or entities covered under UNSC
embargo/ sanctions or on assessment of proliferation concerns, or
national security and foreign policy considerations, etc.;
iii. DGFT shall reserve the right to deny issuance of GAER or recall GAER
without assigning any reason(s).
F. Applications for grant of General authorisations for export to the
same entity from goods were imported shall be approved by Chairman
IMWG, without any consultation with IMWG members after the first
export/shipment. In exceptional cases, consultation with IMWG may be
done prior to issuance of GAER, incase required.

G. All such authorisations shall be brought before IMWG in its

subsequent meeting for confirmation of approval, on ex-post facto basis.

10.13 Issue of export authorisations for

demo/display/exhibition/tenders/ RFP/RFQ/NIT of SCOMET items
An application for grant of an Authorisation for (i) export of
indigenous/imported SCOMET item(s) for demo/display/exhibition/
tenders/RFP/RFQ/NIT purposes abroad; and (ii) export of SCOMET item(s)
imported for participation in demo/display/exhibition /tenders/RFP/RFQ/NIT
in India, shall be made in prescribed proforma [ANF 10A] through online
SCOMET portal along with other supporting documents, as required in the

pg. 185
prescribed proforma. The application shall be considered by Chairman IMWG, on
fulfilment of the following conditions:

(A) Authorisation for export of indigenous/imported SCOMET item(s) for

demo/display/exhibition /tender/RFP/RFQ/NIT abroad

i. Conditions to be fulfilled:
Authorisations for export of items in SCOMET List (other than those
under Category 0, 1, 2 and 6 or ‘Technology’ or ‘Software’ in any
category) solely for purposes of (a) Demo (b) Display (c) Exhibition (d)
Tenders/RFP/RFQ/NIT shall be considered by Chairman IMWG, on the
following conditions:
(a) Such cases would be considered purely on temporary export basis
for a specified time period;

(b) No end user certificate would be insisted upon in such cases;

(c) There shall not be any commercial transaction in the form of

selling/buying/renting/leasing;

(d) The number of item(s) should be commensurate with the nature

of export items and the purpose for which the application is being
made;

(e) There shall not be any exchange/disclosure of information which

could lead to transfer of technology;

(f) No export authorisation would be granted for UNSC sanctioned

destinations or countries/entities of high risk, as assessed by the
IMWG, from time to time;

(g) The application is accompanied with relevant documents as

prescribed in Appendix 10G;

(h) Legal Undertaking on the stamp paper of Rs. 200/-, in prescribed

proforma (Appendix 10K);

(i) Applications for grant of authorisations shall be approved after

verifying the credentials of the event/organizer;

ii. Return of item(s) and post-reporting compliance:

pg. 186
 (a) Exported items shall be brought back to India within 90 days after
the event gets over or within the extended time, as allowed by the
DGFT;

(b) Bill of Entry confirming the return back of such SCOMET item(s)
to India shall be intimated by the licensee to the DGFT(Hqrs) in
the prescribed proforma (Annexure-I of Appendix 10K) duly
signed in ink and stamped by the authorised signatory.
(B) Authorisation for export of imported SCOMET items after
participation in demo/display/ exhibition/tenders/RFP/RFQ/NIT in
India
Application for grant of authorisation for export of imported SCOMET items
(other than those under Category 0, 1, 2 and 6 or ‘Technology’ or ‘Software’ in
any category) to the entity from which it has been originally imported or to its
OEM (including agency authorized by OEM), after Demo/Display/
Exhibition/tender/RFP/RFQ/NIT, shall be considered by Chairman IMWG, on the
following conditions:
a) The SCOMET item(s) were imported in India for the purpose of
demo/display/exhibition/tender/RFP/RFQ/NIT under a contract
agreement between Indian exporter and supplier/OEM(including agency
authorized by OEM);
b) The export should only be to the entity from which the item(s) has/have
been imported or to the OEM (including agency authorized by OEM);
c) No details on ‘End Use’ and ‘End Use Certificate’ would be required;
d) No export authorisation would be granted for UNSC sanctioned
destinations or countries/entities of high risk, as assessed by the IMWG,
from time to time;
e) The application is accompanied with relevant documents as prescribed in
Appendix 10H;
f) Applications for grant of authorisations for export to the entity from which
it was originally imported or to the OEM (including agency authorized by
OEM) shall be approved by Chairman IMWG, without any consultation
with IMWG members.
g) However, in cases of export to an entity other than the original supplier or
OEM (including agency authorized by OEM), approval will be granted by
Chairman, IMWG after verification of the credentials of the foreign entity to
which the item(s) are to be exported.
h) All such authorisations shall be brought before IMWG in its subsequent
meeting for confirmation of approval, on ex-post facto basis.
Note :
RFP refers to Request for Proposal;
RFQ refers to Request for Quotation and
NIT refers to Notice Inviting Tender.

pg. 187
10.14 Issue of export authorisations for re-export/return of
imported SCOMET items to the same foreign entity or to its OEM
(including agencies authorized by OEM)
i. Conditions to be fulfilled:

An application for grant of an Authorisation for re-export/return of

imported SCOMET items to the foreign entity from which it has been
originally imported or to its OEM(including agency authorized by OEM),for
reasons such as obsolescence of technology of imported items; cancellation
of order by the Indian buyer /end user; dead on arrival etc., shall be
considered by Chairman IMWG, on fulfilment of the following conditions :

(a) The export should only be to the entity from which the item(s)
has/have been imported or to the OEM (including agency/ies
authorized by OEM);

(b) No details on ‘End Use’ and ‘End Use Certificate’ would be required;
(c) No export authorisation would be granted for UNSC sanctioned
destinations or countries/entities of high risk, as assessed by the
IMWG, from time to time;
(d) The application is accompanied with relevant documents as
prescribed in Appendix 10I, including proof of
obsolescence/cancellation of order for intended items and
undertaking from the applicant firm;

(e) Re-export/return of items due to reasons such as obsolescence of

technology of imported items; cancellation of order by Indian
buyer/end user; dead on arrival etc. (whichever is applicable) is
allowed under the conditions of import or contractual agreement.

ii. Applications for grant of authorisations for export to the entity from which
it was originally imported or to the OEM (including agency authorized by
OEM) shall be approved by Chairman IMWG, without any consultation with
IMWG members. However, in cases of re-export/return to an entity other
than the OEM (including agencies authorized by OEM), approval will be
granted by Chairman, IMWG after verification of the credentials of the
foreign entity to which the item(s) are to be exported.

iii. All such authorisations shall be brought before IMWG in its subsequent
meeting for confirmation of approval, on ex-post facto basis.

pg. 188
10.15 Global Authorisation for Intra-Company Transfers (GAICT)
of SCOMET Items including /Software/Technology
A. Scope and Eligibility: Pre-export authorisation will not be required,
for export and/or re-export of SCOMET items including software and
technology under SCOMET Category 8 (except items listed in Appendix
10M), subject to the following conditions:

i. where the export is an Intra-company transfer from the Indian parent

company (applicant exporter) to its foreign subsidiary company or
from the Indian subsidiary of foreign company (applicant exporter) to
its foreign parent/another subsidiary of foreign parent company and;

Note: In case of third party involvement in the supply chain, the end
user has to be a foreign parent / another subsidiary of foreign parent
company or a subsidiary company of Indian company.

ii. where the transfer fulfils the conditions mentioned at (a) to (h)
below:

a. The items/software/technology to be exported/re-exported is

based on a Master Service Agreement / Contract between the
Indian parent company/Indian subsidiary of foreign company
and foreign subsidiary of Indian company/foreign parent
company of Indian subsidiary for carrying out certain services
but not limited to design, encryption, research, development,
delivery, validation, calibration, testing, related services, etc.;

Note 1: As a result of the service carried out by the Indian exporter in

case of re-export, the items/software/technology should not undergo
change in classification.

Note 2: The list of services mentioned above is illustrative, not

exhaustive. However, the final decision to approve a GAICT
authorisation lies with the relevant authority.

b. These items including software and technology are to be

exported/re-exported to the countries listed in Table 1 below
(entire supply chain including any third party should be in the
countries listed in Table 1below);

Table 1

Argentina, Australia, Austria, Belgium, Bulgaria, Canada,

Croatia, Czech Republic, Denmark, Estonia, Finland, France,

pg. 189
 Germany, Greece, Hungary, Ireland, Italy, Japan, Latvia,
Lithuania, Luxembourg, Malta, Mexico, Netherlands, New
Zealand, Norway, Poland, Portugal, Republic of Korea,
Romania, Russian Federation, Slovakia, Slovenia, South Africa,
Spain, Sweden, Switzerland, Turkey, Ukraine, United Kingdom,
United States.
Note: However, IMWG on a case to case basis may allow countries other than those
listed in Table 1 considering description/end use/end user of the item.

c. The applicant exporter declares that the exported items would

be used for the purposes for which it is intended by the foreign
subsidiary of Indian company / foreign parent company /
another subsidiary of foreign parent company, as the case may
be;

d. The applicant exporter furnishes either a certified/approved

Internal Compliance Programme (ICP) or demonstrates
compliance to the ICP of the foreign parent company or ICP
certified by the Compliance Manager of the company or certified
by any Government agency such as Authorized Economic
Operator (AEO) scheme etc.

e. The exporter agrees to allow on-site inspection, if required by

the DGFT or authorized representatives of Government of India;

f. No export authorisation would be granted for UNSC sanctioned

destinations or countries;

g. No export authorisation shall be granted to an exporter

specified at (i) above if they have come to adverse notice
previously;

h. The exporter is granted a Global Authorisation for Intra-

Company Transfers (GAICT) as per procedure mentioned in
para 10.15 B below.

B. Procedure for grant of Global Authorisation for Intra-Company

Transfers (GAICT)
Filing and Assessment of Application
a. In respect of export/re-export of SCOMET items including software and
technology ,the applicant exporter shall submit an application for GAICT

pg. 190
 through online SCOMET portal and attach information in proforma –
ANF10C ;
b. The application would be assessed for the issue of GAICT by Inter-
Ministerial Working Group (IMWG) based on the submission of the
application and other supporting documents by the applicant exporter in
the prescribed proforma;
i. Documentary proof of the corporate relationship between the Indian
parent company (applicant exporter) and its foreign subsidiary
company or between the Indian subsidiary of foreign company
(applicant exporter) and its foreign parent / another subsidiary of
foreign parent company ;

ii. Classification of item including software and technology in SCOMET

(indicating SCOMET category and sub-category);

iii. Documentary proof of License Exception /Temporary license from the

country of the parent company abroad or from subsidiaries of the
parent company abroad, if available (optional)

iv. Detailed description of the item intended to be exported with relevant

technical details with specifications, such as model, part number, etc.
and in case of software/technology, relevant details like encryption
algorithm, key length, encryption functionality, eligibility under
cryptography note etc. to be provided (if applicable);

v. In case of third party involvement in the supply chain, a clear contract

/service agreement/ Purchase order has to be furnished specifying
SCOMET item description.

vi. Certified/approved ICP of the Indian parent company or self-certified

copy of the ICP of the foreign parent company being adopted by
Indian subsidiary of foreign company along with an undertaking
thereon;

vii. Undertaking on the letterhead of the firm duly signed and stamped by
the authorised signatory:

a. To allow on-site inspection, if required by the DGFT or authorized

representatives of Government of India;

b. The applicant exporter declares that the exported items would be

used for the purposes for which it is intended by the foreign

pg. 191
 subsidiary of Indian company / foreign parent company / another
subsidiary of foreign parent company, as the case may be;

c. The applicant exporter declares that subsequent to issue of

export authorisation, if the licensee has been notified in writing
by DGFT or if they know or has reason to believe that an item may
be intended for military end use, the exporter would not be
eligible for GAICT for export of that/those item(s) and would
apply separately to DGFT for a fresh authorisation in terms of
regular policy. [Refer Para 10.05 of HBP].

viii. The Company must ensure that:

a. They shall submit original End User Certificate in the prescribed

format within 30 days of filing application and in case of
subsequent exports, within 30 days of delivery at destination
point, after issue of export authorisation;

b. They have Agreement/purchase order, excerpt of contract from

entity (consignee) receiving the items which states the export is
for a permitted use;

c. The documents include the name & contact number and email id
of the authority signing the EUC.

ix. A precise and clear contract /service agreement/ Purchase order has
to be furnished indicating item description in case of third party
involvement in the supply chain (if applicable)

x. Additional details, if any, sought by DGFT

C. Post reporting for re-export of items/software/technology under

GAICT

a. The Indian exporter shall submit post-shipment details of each

transfer/consignment of exports of SCOMET items/software/technology
under GAICT to the SCOMET Division of DGFT (Hqrs), New Delhi, through
online system on DGFT website, on quarterly basis (March / June /
September / December), by the end of subsequent month of each quarter,
in respect of the exports made in the previous quarter;

b. The post-shipment details shall be submitted in proforma ANF 10D along

with a copy of EUC in Appendix 10J(iv) within the timelines mentioned

pg. 192
 above, from the foreign subsidiary company or foreign parent company /
another subsidiary of foreign parent company;

c. Failure to do so may entail imposition of penalty and / or

suspension/revocation of GAICT.

Note: ANF (Aryat Niryat Form) –ANF 10C, ANF 10D and EUC Proforma Appendix
10J(iv) may be referred

D. Record Keeping

The exporter will be required to keep records of all the export documents, in
manual or electronic form, in terms of Para 10.18 of HBP, for a period of 5 years
from the date of GAICT issued by DGFT.

E. General conditions

a. GAICT would not be issued in case of items including software and

technology to be used to design, develop, acquire, manufacture,
possess, transport, transfer and / or used for chemical, biological,
nuclear weapons or for missiles capable of delivering weapons of
mass destruction and their delivery system;

b. GAICT would not be issued for countries or entities covered under

UNSC embargo or sanctions list or to the countries or entities
assessed for risk of proliferation concern, based on national security
and foreign policy considerations;

c. In case of inclusion or amendment of items (including software and

technology) or inclusion of new companies or amendment in
existing companies in the supply chain, the applicant exporter will
obtain prior permission of DGFT with relevant details;

d. IMWG shall reserve the right to deny issuance of authorisation

GAICT for any reason and also relax any provision of the policy, if so
required in exceptional cases.

F. Re-exports / re-transfer of the items including software and

technology (processed or incorporated)

Further re-exports / re-transfers of the items including software and technology

(processed or incorporated) from the foreign subsidiary company or foreign
parent company / another subsidiary of foreign parent company to end users in
other countries would be subject to the export control regulations of the country

pg. 193
of the foreign subsidiary of Indian company or foreign parent company / another
subsidiary of foreign parent company.

G. Validity

a) GAICT issued for intra-company transfers of SCOMET items

including software and technology shall be valid for a period of
three years from the date of issue of GAICT;

b) GAICT cannot be revalidated in terms of Paragraph 10.20 of HBP of

FTP.

H. Suspension / Revocation

GAICT issued shall be liable to be suspended by the DGFT on receipt of intimation

about initiation of any inquiry from the country concerned or from any domestic
agency. GAICT shall be revoked on receipt of an adverse report on proliferation
concern or for non-submission of mandatory reports/documents within the
prescribed timelines or for non-compliance of any of the condition of this policy.

10.16 General Authorisation for Export of Chemicals and related

Equipment (GAEC) of SCOMET items
A. Procedure for grant of General Authorisation for Export of Chemicals
and related equipment (GAEC)

I. In respect of export/re-export of SCOMET items under the Categories /

Sub Categories of 1C, 1D,1E, 3D001 and 3D004 (excluding software and
technology), the applicant exporter shall submit an application for GAEC
through online SCOMET portal and attach information in proforma –ANF
10A;

II. The application would be reviewed/examined for the issuance of GAEC by

Inter-Ministerial Working Group (IMWG) based on the submitted
application and other supporting documents submitted by the applicant
exporter in the prescribed proforma including;

a. Detailed description of the items that are intended to be exported

under this authorisation with relevant technical details /
specifications, such as model, part number, etc. to be provided (as
applicable); In case of first intended export of items under the above
Categories / Sub Categories, details of the entire supply chain (buyer,
consignee, end user, etc.) of an intended export is to be provided. In
case of previous exports of items under the above Categories / Sub

pg. 194
 Categories having been carried out, details of past exports including
the EUC is to be provided.

b. Undertaking on the letterhead of the firm duly signed and stamped by

the authorized signatory stating the following:

i. Any on-site inspection will be allowed by the applicant exporter, if

required by the DGFT or authorized representatives of
Government of India;

ii. The applicant exporter declares that the items that are intended
to be exported shall not be used for any purpose other than the
purpose(s) stated in the EUC and that such use shall not be
changed nor the items modified or replicated without the prior
consent of the Government of India.;

iii. The applicant exporter declares that subsequent to issue of

export authorisation, if the licensee has been notified in writing
by DGFT or if they know or has reason to believe that an item may
be intended for military end use or has a potential risk of use in or
diversion to weapons of mass destruction (WMD) or in their
missile system, the exporter would not be eligible for GAEC for
export of that/those item(s) and would apply separately to DGFT
for a fresh authorisation in terms of regular policy.

iv. Action will be taken against the exporter under FT (D & R) Act,
1992 for any mis-declaration.

c. After issuance of GAEC authorisation and before actual export, the

applicant exporter must ensure the following:

i. They shall notify the relevant government authorities in the

online portal of DGFT, within 30 days of such export in the
prescribed format [Aayat Niryat Form ANF 10A along with the
End-Use Certificate (EUC) in the prescribed proforma [Appendix
10J (i) or (ii), as per applicability] and a copy of the bill of entry
into the destination country within 30 days of delivery at
destination point.

ii. They have an agreement or a purchase order, excerpt of contract

from entity (consignee / end user) receiving the items which
states that the export is for a permitted use / an end use as
declared in the EUC before actual export;

pg. 195
 iii. They possess documents include the name, contact number and
email id of the authority signing the EUC before actual export.

iv. Additional details, if any sought by DGFT

B. Post reporting for export / re-export of items under GAEC

a. The Indian exporter shall submit post-shipment details of each

export/ re-export of SCOMET items under the above Categories/ sub-
categories under GAEC, as mentioned above at II.c. (i) and within the
timelines specified therein;

b. Failure to do so may entail imposition of penalty and / or

suspension/revocation of GAEC.

C. General Conditions & Exclusions

a. GAEC would not be issued in case of items to be used to design,

develop, acquire, manufacture, possess, transport, transfer and / or
used for chemical, biological, nuclear weapons or for missiles capable
of delivering weapons of mass destruction and their delivery system;

b. GAEC would not be issued for countries or entities covered under

UNSC embargo or sanctions list or on assessment of proliferation
concerns, or national security and foreign policy considerations, etc.;

c. IMWG shall reserve the right to deny issue of GAEC without assigning
any reason(s).

D. Suspension / Revocation

GAEC issued shall be liable to be suspended / revoked by the DGFT on receipt of

an adverse report on proliferation concern or for non-submission of mandatory
post-shipment details / reports / documents within the prescribed timelines or
for non-compliance with the conditions of the proposed policy.

10.17 Validity Period of SCOMET Authorisations

The validity period of SCOMET authorisations from the date of issue shall be as
follows, unless specified otherwise

S.No. Type of SCOMET Validity Period

Authorisation

1 SCOMET The validity period of the SCOMET authorisation shall be

for a period of 24 months, unless otherwise specified.

pg. 196
 Authorisation

2 SCOMET GAICT authorisation issued for intra-company transfers

Authorisation of SCOMET items/software/technology shall be valid for
issued under a period of 3(three years) from the date of issue of
GAICT Policy authorisation and shall be further subject to the
following validity timelines, whichever is earlier:
i. Till the validity of license exception of foreign
parent company ; or
ii. Till the validity of license exception of foreign
parent company for subsidiary(ies) of the parent
company abroad; or
iii. Till the validity of Master Service Agreement
(MSA) / Contract with the foreign parent
company and the Indian subsidiary.

3 SCOMET GAEC issued for export / re-export of SCOMET items

Authorisation under the above Categories / Sub Categories (excluding
issued under software and technology) shall be valid for a period
GAEC Policy of 5(five) years from the date of issue of GAEC subject to
subsequent post reporting(s) on quarterly basis to be
reported within 30 days from the last quarter;

4 SCOMET GAER issued for export of imported SCOMET items after

Authorisation repair shall be valid for a period of 1 year from the date
issued under of issue of GAER subject to subsequent post reporting(s)
GAER Policy within 30 days from such export.

10.18 Record Keeping

Every SCOMET export authorisation holder (including for GAICT and GAEC) shall
maintain all the relevant records, including all the documents submitted while
making an application for SCOMET Authorisation, in manual or electronic form,
for a period of 5 years or till validity of export authorisation, whichever is higher,
from the date of export or import, as applicable.

10.19 Voluntary Self Disclosure of export of dual use items

DGFT encourages voluntary self disclosures of failure to comply with the export
control provisions, and supports raising awareness among exporters to avoid
any incidents of non-compliance. In case, any exporter fails to comply with the
export control provisions of the FTDR Act, WMD Act, Customs Act, or any
regulation related to SCOMET, or SCOMET authorisation on export controls
issued by DGFT, a voluntary self disclosure request along with the supporting

pg. 197
documents shall be sent to the SCOMET Division of DGFT (Hqrs), New Delhi,
through e-mail ([email protected]) immediately after an export violation is
discovered. Detailed procedure/guidelines in this regard will be notified by the
DGFT separately.
The IMWG may consider each case on merit in accordance with the provisions of
the Export and Import Policy determined by the Central Government from time
to time under the Foreign Trade (Development and Regulation) Act 1992 and the
orders issued thereunder, and may make recommendations on further action to
be taken by DGFT in the specific case(s).
Exporter is liable for strict action under the provisions of the FTDR Act for any
violation of SCOMET policy brought to the notice of DGFT in cases other than
voluntary self disclosure.

10.20 Revalidation of SCOMET Authorisation

Export Authorisationfor SCOMET items may be revalidated, on merits for a
period of six months at a time and maximum upto 12 months by the DGFT
(Hqrs). An application for grant of revalidation may be made in prescribed
proforma [ANF 10F] 30 days prior to the expiry of authorisation. The period of
renewal of authorisation shall be counted from the date of actual expiry of
authorisation. The total period of extension will not exceed 12 months.
Revalidation to export authorisations issued for Technology/Software transfer
under any category is not permitted. SCOMET Authorisations issued under GAEC,
GAICT and GAER policy cannot be revalidated.

pg. 198
CHAPTER 11

Miscellaneous Matters
 CHAPTER 11
MISCELLANEOUS MATTERS

11.01 Denomination of Import Authorisation/Licence/

Certificate/Permissions

(a) CIF value of Authorisation / FOB value of export obligation shall be

indicated both in Rupees and in freely convertible currency(s) at the
exchange rate(s) prevailing on Authorisation issue date.

(b) Remittance of foreign exchange and discharge of export obligation

against Authorisation shall be regulated in freely convertible currency
or in Indian Rupees as per para 2.52 and 2.53 of FTP.

(c) No enhancement in Rupee value shall be necessary if remittance of

foreign exchange is covered by CIF value of Authorisation shown in
freely convertible currency.

(d) However, on Advance Authorisation(s), issued for exports to ACU

countries, export obligation shall be denominated and discharged in
ACU dollars.

(e) Export obligation in Advance Authorisation for intermediate supply

and for deemed export, where supplies are to be made within the
country, shall be denominated and discharged in Indian rupees.

11.02 Late Cut

Wherever any application for any fiscal/financial benefits under FTP
complete in all respects is received after expiry of last date for submission
of such application, the application may be considered after imposing a late
cut in the following manner:

Application received after the expiry of last 2%

i. date but within six months from the last
date
ii. Application received after six months from 5%
the prescribed date of submission but not
later than one year from the prescribed date

pg. 200
 iii. Application received after 12 months from 10%
the prescribed date of submission butnot later
than 2 years from the prescribed date

11.03 Supplementary Claims

Wherever any application for supplementary claim is received, within
specified time limits, such application may also be considered after
imposing a cut @2% on the entitlement.

11.04 Furnishing of Information

Every importer/ exporter shall furnish such information within the
stipulated time as may be called for by DGFT or any officer duly
authorised. Failure to furnish the requisite information within the
stipulated time shall warrant Penal action as laid down in the FTP or as
per the FT(D&R) Rules,1993.

11.05 Clarifications on Policy/Procedure

A request seeking clarifications on any provision of FTP or HBP,
importability or exportability of items under ITC(HS), made to DGFT in the
form in ANF2F. Clarification may also be sought on E-mail.

11.06 Consumption Register

Importer shall maintain a register as in Appendix-4H (for 3 years period)
of items imported under an Authorisation and separately for items imported
with actual user condition and its consumption. In respect of particular
schemes such register shall be maintained for specified period.

11.07 Export Facilitation

In order to resolve exporters' problems in a co-ordinated manner, field
offices of DGFT shall act as Export Facilitation Centres and nodal agencies.

11.08 Standing Grievance Committee

For speedy redressal of genuine grievances of trade and industry pertaining
to Export and Foreign Trade, Grievance Committees have been constituted
chaired by (i) DGFT at Headquarters and (ii) head(s) of RA(s) in regional
offices. Grievance Committee will include representatives of Federation of
Indian Export Organisations (FIEO), Export Promotion Councils/
Commodity Boards, Development Authorities, and Government

pg. 201
 Departments/ technical authorities, Custom Authorities, GST Authorities,
DGARM, Banks (Public and Private Sectors), Export Inspection Agencies/
Councils, ECGC, Industries Commissioner (State/UT), Export Commissioner
(State/UT), General Manager (GM) District Industries Centre (DIC) as their
members.

11.09 Counter Assistance

(a) While the endeavour of DGFT is to make filling/submission of all
applications online, till the time the facility for online application is not
available, applications will continue to be received at the counter.

(b) For speedy disposal of applications, "Counter Assistance" will function

in all offices of DGFT. An FTDO shall be in charge of counter in each
office. On presentation of application at the counter, applicant would
be advised whether his application is complete or there is any
deficiency that needs to be rectified.

(c) Counter Assistance may also be availed of for amendments of minor

nature/enquiries. Applications, in such cases, will be received in
regional offices at counter against a proper receipt. Authorisation /
licence /list /enquiry shall be returned after carrying out necessary
amendments/ giving necessary reply as far as possible on the same
day, across the Counter.

11.10 Time Bound Disposal of Applications

RA shall dispose of applications expeditiously. Following time schedule shall
normally be followed to dispose of applications provided it is complete in all
respects and is accompanied by prescribed documents.

S. Category of Application Time Limit For

No. Disposal (in
working days)
IEC Number 2
Advance Authorisation where Input- 3
Outputnorms are notified or under
paragr
aph
4.07 of HBP, Advance Authorisation for
Annual Requirement and DFIA.
Issuance of Advance Authorisation through 1
automatic route
Fixation of Input Output Norms for SAAS 90
covered under para 4.04A of FTP

pg. 202
 Issuance of EPCG Authorisations 3
Issuance of EPCG authorisation through 1
automatic route
All Authorisations under Gem & Jewellery 3
scheme
Revalidation of Advance 1
Authorisation and
extension of Export Obligation period of
AA/EPCG authorisations by R.A
Acceptance of BG/LUT 3
Redemption/EODC of 15
Advance
Authorisation/ DFIA
Redemption of EPCG Authorisations 30
andrelease of BG /LUT.
Issuance/renewal of status certificate 3
Amendment of any category of 3
Authorisation
Miscellaneous 10
Refund of DBK/ TED under deemed export 30
Fixation of Brand Rate for duty drawback 30

In all the above cases, the number day is counted from the date of submission
of complete application. Cases of undue delay in disposal of applications may
be brought to notice of head of regional offices by way of a written
representation, which shall be promptly enquired into andresponded to.

11.11 Date of shipment/Dispatch in respect of Imports

Date of shipment/dispatch for imports will be reckoned as under:-

S.No. Mode of Date of Shipment / Dispatch

Transportation

(i) By Sea The date affixed on the Bill of Lading

(ii) By Air Date of relevant Airway Bill provided this

represents date on which goods left last airport
in the country from which the
import is effected.

pg. 203
 (iii) From land-Locked Date of dispatch of goods by rail, road orother
Countries recognised mode of transport to consignee
in India through consignment basis.

(iv) By Post Parcel Date stamp of office of dispatch on thepacket

or dispatch note
(v) By Registered Date affixed on Courier Receipt / Waybill
Courier Service
(vi) Multimodal Date of handing over goods to first carrier ina
Transport combined transport Bill of Lading

11.12 Date of Shipment/ Dispatch in respect of Exports

a) Date of shipment/despatch for exports will be reckoned as under:

Sl. Mode of Date of Shipment / Dispatch

No. Transportation

(i) By Sea (a) For bulk cargo, date of Bill of Lading or

date ofmate receipt, whichever is later?

(b) For containerised cargo, date of

"Onboard Bill of Lading", or "Received for
Shipment Bill of Lading", where the L/C
provides for such Bill of Lading. For exports by
containers from Inland Container Depot (ICD),
date of Bill of Lading issued by shipping
agents at the time of loading of export goods in
ICD after customs clearance.

(c) For Lash barges, date of Bill of Lading

evidencing loading of export goods on board.
(ii) By Air Date mentioned by appropriate Officer of
Customs on Shipping Bill, evidencing loading or
handing over of goods to air cargo complex,
which are not international airports, or by
way of
rotation of flight number and date.
(iii) By Post Parcel Date stamped on postal receipt
(iv) By Rail Date of RR (Railway Receipt)
(v) By Registered Date affixed on Courier Receipt/ Waybill.
Courier Service

pg. 204
(vi) By Road Date on which goods crossed Indian
bor
der as certified by Land Customs Authorities.

b) However, wherever Procedural / Policy provisions have been

modified to disadvantage of exporters, the same shall not be
applicable to consignments already handed over to Customs for
examination and subsequent exports up to Public Notice / Notification
date.

c) Similarly, in cases where goods are handed over to the customs

authorities before expiry of export obligation period but actual
Exports take place after expiry of the export obligation period, such
exports shall be considered within export obligation period and
taken towards fulfilment of export obligation.
d) However, for benefit under FTP, Let Export Order (LEO) date shall be
the date of reckoning of export.

11.13 General Power of Review

DGFT may, on his own or otherwise, call for records of any case pending with or
decided by an officer subordinate to him or an officer of any EPC/FIEO including
a Group/ Committee of officers nominated, appointed or authorised by him and
pass such orders as he may deem fit.

pg. 205
GLOSSARY (ACRONYMS)
Acronym Explanation
AA Advance Authorisation
AANF Appendices and Aayaat Niryaat Form
ACU Asian Clearing Union
AEZ Agri Export Zone
ANF Aayat Niryaat Form
ARE-1 Application for Removal of Excisable Goods for Export
(By Air/Sea/Post/Land)
ARE-3 Application for Removal of Excisable Goods from a factory
or a warehouse to another warehouse
ACP Accredited Clients Programme
AEO Authorised Economic Operator
AES Approved Exporter’s Scheme
APEDA Agricultural & Processed Food Products Export
Development Authority
ARO Advance Release Order
ASEAN Association of South-East Asian Nations
ASIDE Assistance to States for Infrastructure Development of
Exports
AU Actual User
BCD Basic Customs Duty
BG Bank Guarantee
BIFR Board of Industrial and Financial Reconstruction
BOA Board of Approval
BOT Board of Trade
BRC Bank Realisation Certificate
BTP Biotechnology Park
BIS Bureau of Indian Standards
CBEC Central Board of Excise and Customs
CCP Customs Clearance Permit
CEA Central Excise Authority
CEC Chartered Engineer Certificate
CED Central Excise Duty
CENVAT Central Value Added Tax
CETF Common Effluent Treatment Facility
CFCs Common Facility Centres
CG Capital Goods
CIF Cost, Insurance & Freight
CIN Corporate Identification Number
CIS Commonwealth of Independent States
CKD Completely Knocked Down
pg. 206
CoD Cash on Delivery
CoO Certificate of Origin
CQCTD Committee on Quality Complaints and Trade Disputes
CRES Certificate of Registration as Exporter of Spices
CST Central Sales Tax
CIN Company Identification Number
CRES Certification of Registration as Exporter of Spices
CEPA Comprehensive Economic Partnership Agreement
CBEC Central Board of Excise and Customs
CSP Common Service Provider
CECA Comprehensive Economic Cooperation Agreement
CVD Countervailing Duty
DA Document against Acceptance
DBK Drawback
DC Development commissioner
DDA Diamond Dollar Accounts
DEA Department of Economic Affairs
DEL Denied Entity List
DES Duty Exemption Schemes
DFIA Duty Free Import Authorisation
DGCI&S Director General, Commercial Intelligence & Statistics
DIN Director Identification Number
DPIN Designated Partner Identification Number
DGFT Director General of Foreign Trade
DoBT Department of Bio Technology
DoC Department of Commerce
DeitY Department of Electronics and Information Technology
DoR Department of Revenue
DoT Department of Telecommunications
DRS Duty Remission Schemes
DTA Domestic Tariff Area
e-BRC Electronic Bank Realisation Certificate
e-IEC Electronic Importer-Exporter Code
ECA Enforcement-cum-Adjudication
EDI Electronic Data Interchange
ECGC Export Credit Guarantee Corporation
EEFC Exchange Earners’ Foreign Currency
EFC Exim Facilitation Committee
EFT Electronic Fund Transfer
EGM Export General Manifest
EHTP Electronic Hardware Technology Park
EIC Export Inspection Council
EO Export Obligation
pg. 207
EODC Export Obligation Discharge Certificate
EOP Export Obligation Period
EOU Export Oriented Unit
EPC Export Promotion Council
EPCG Export Promotion Capital Goods
EPO Engineering Processing Outsourcing
EXIM Export Import
FDI Foreign Direct Investment
FE Foreign Exchange
FEMA Foreign Exchange Management Act
FIEO Federation of Indian Export Organisation
FIRC Foreign Exchange Inward Remittance Certificate
FOB Free On Board
FOR Freight on Road and Rails
FT (D&R) Act Foreign Trade (Development & Regulation) Act, 1992 (22 of
1992)
FTDO Foreign Trade Development Officer
FTP Foreign Trade Policy
FT( R) Rules Foreign Trade (Regulation) Rules
FTWZ Free Trade and Warehousing Zone
FTA Free Trade Agreement
G&J EPC Gems & Jewellery Export Promotion Council
GOI Government of India
GATS General Agreement on Trade in Services
GR Guarantee of Realisation
HACCP Hazard Analysis and Critical Control Process
HBP Handbook of Procedures
HHEC Handicraft & Handlooms Exports Corporation
ICB International Competitive Bidding
ICD Inland Container Deport
ICM Indian Commercial Mission
IEC Importer Exporter Code
ISO International Organisation for Standardisation
IAEA International Atomic Energy Agency
INFCIRC International Atomic Energy Agency Information Circular
IEM Industrial Entrepreneurial Memorandum
IMSC Inter-Ministerial Standing Committee
IL Industrial Licensing
ISO International Standards Organisation
ITC (HS) Indian Trade Classification (Harmonised System) for Export
& Import Items
KVIC Khadi and Village Industries Commission
LC Letter of Credit
pg. 208
LCS Land Customs Station
LLPIN Limited Liability Partnership Number
LPG Liquefied Petroleum Gas
LoC Line of Credit
LoI Letter of Intent
LoP Letter of Permit
LUT Legal Undertaking
MAI Market Access Initiative
MDA Market Development Assistance
MEA Ministry of External Affairs
MEIS Merchandise Exports from India Scheme
MRA Mutual Recognition Agreements
MoD Ministry of Defence
MoF Minstry of Finance
MSME Ministry of Micro Small and Medium Enterprises
MSMED Micro Small and Medium Enterprises Development
MSTC Metal Scrap Trade Corporation
NBFC Non-Banking Financial Company
NC Norms Committee
NFE Net Foreign Exchange
NI Non-Infringing
NCB National Competitive Bidding
NOC No Objection Certificate
PDS Public Distribution System
PEC Project and Equipment Corporation of India Ltd.
PIC Policy Interpretation Committee
PRC Policy Relaxation Committee
PAN Permanent Account Number
PH Personal Hearing
PTA Preferential Trade Agreement
PSU Public Sector Undertaking
R&D Research and Development
RA Regional Authority
RBI Reserve Bank of India
RCMC Registration-cum-Membership Certificate
REP Replenishment
RPA Rupee Payment Area
S/B Shipping Bill
SAD Special Additional Duty
SCOMET Special Chemicals, Organisms, Materials, Equipment and
Technology
SEI CMM Software Engineers Institute’s Capability Maturity Model
SEZ Special Economic Zone
pg. 209
SEIS Service Exports from India Scheme
SIA Secretariat for Industrial Assistance
SIIC State Industrial Infrastructure Corporation
SION Standard Input Output Norms
SKD Semi-Knocked Down
SLEPC State Level Export Promotion committee
STC State Trading Corporation
STCL Spices Trading Corporation Limited
STE State Trading Enterprise
STH Star Trading House
STPI Software Technology Park of India
STR State Trading Regime
SUVs Sports Utility Vehicles
TED Terminal Excise Duty
TEE Towns of Export Excellence
TH Trading House
TPO Trade Promotion Organization
TRA Telegraphic Release Advice
TRQ Tariff Rate Quota
TUFS Technology Upgradation Fund Scheme
UAC Units Approval Committee
UN United Nations
VA Value Addition
WCO World Customs Organisation
WHOGMP World Health Organisation Good Manufacturing Practices

pg. 210