Epcg

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 January 2012 We are a manufacturer-exporter.
We want to import some tools to manufactur our export product. These tools will be used by our vendor on their machine to produce our product which we will export.
Can we import these tools under EPCG scheme? We can complete export obligation in time.

If not please suggest suitable measure to save import duty.

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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24 January 2012 Admissible .

Import of capital goods under this scheme shall be subject to actual used condition till the export obligation is completed. Both new an second hand capital good may be imported. Second hand capital goods at permitted subject to the condition that such goods have a minimum of residual life of 5 years and the importer furnishing to the customs at the time of clearance of goods a self declaration to the effect that the second hand capital goods being imported have a minimum residual life of five years in the prescribed form. In case the value of the second hand capital goods imported is rupees one crore or more the importers shall also furnish to the customs at the time of clearance of goods a certificate from the Inspection and certification agency to the effect that the purchase price is reasonable. In case of imports at zero duty the minimum residual life of the second hand goods shall be ten years. The concessional assessment is extended only to the goods covered by an licence issued under the EPCG Scheme.

any query will be highy appreciated.

regards,

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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24 January 2012 as per exim policy para 5.2 you admissible for :

Concessional 3% duty EPCG scheme allows import of capital goods for pre-production, production and post production (including CKD/SKD thereof as well as computer software systems) at 3% Customs duty, subject to an export obligation equivalent to 8 times of duty saved on capital goods imported under EPCG scheme, to be fulfilled in 8 years reckoned from Authorization issue-date.
In case of agro units, and units in cottage or tiny sector, import of capital goods at 3% Customs duty shall be allowed subject to fulfillment of export obligation equivalent to 6 times of duty saved on capital goods imported, in 12 years from Authorization issue-date.

For SSI units, import of capital goods at 3% Customs duty shall be allowed, subject to fulfillment of export obligation equivalent to 6 times of duty saved on capital goods, in 8 years from Authorization issue- date, provided the landed cif value of such imported capital goods under the scheme does not exceed Rs. 50 lakhs and total investment in plant and machinery after such imports does not exceed SSI limit.

However, in respect of EPCG Authorization with a duty saved amount of Rs. 100 crores or more, export obligation shall be fulfilled in 12 years.

In case CVD is paid in cash on imports under EPCG, incidence of CVD would not be taken for computation of net duty saved, provided the same is not CENVATed.

Capital goods shall include spares (including refurbished/reconditioned spares), tools, jigs, fixtures, dies and moulds.

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