Sale by 100% eou
This query is : Resolved
30 December 2011
Can 100% E.O.U make sale in D.T.A?
if yes,what are the conditions?
if yes,what are the conditions?
30 December 2011
yes,
Units, other than gems and jewellery units, may sell goods upto 50% of FOB value of exports subject to fulfillment of positive NFE on payment of concessional duties . Within the entitlement of DTA sale, the unit may sell in DTA its products similar to the goods which are exported or expected to be exported from the units. No DTA sale at concessional duty shall be permissible in respect of motor cars, alcoholic liquors, books and tea (except instant tea) or by a packaging/ labeling /segregation/ refrigeration unit/ compacting/micronisation/pulverization/granulation /conversion of mono-hydrate form of chemical to anhydrous form or vice-versa and such other items as may be notified from time to time.
Sales made to a unit in SEZ shall also be taken into account for the purpose of arriving at FOB value of export by EOU provided payment for such sales are made from EEFC Account. Sale to DTA would also be subject to mandatory requirement of registration of pharmaceutical products (including bulk drugs).
as per current foreign trade policy.
Noted :
Following supplies effected from EOU/EHTP/STP/BTP units to DTA will be counted for the purpose of fulfillment of positive NFE:
(a)
Supplies effected in DTA to holders of advance licence, advance licence for annual requirement/DFRC /EPCG scheme.
(b)
Supplies effected in DTA against payment from the Exchange Earners Foreign Currency (EEFC) Account of the buyer in the DTA or against foreign Exchange remittance received from overseas.
( c)
Supplies to other EOU/EHTP/STP//BTP/SEZ units provided that such goods are permissible for procurement in terms of paragraph 6.2 of the Policy.
(d) Supplies made to bonded warehouses set up under the policy and/ or under section 65 of the customs act and free trade and warehousing zones, where payment is received in foreign exchange.
(e) Supplies of goods and services to such organizations which are entitled for duty free import of such items in terms of general exemption notification issued by the Ministry of Finance .
(f) Supply of services (by services units) relating to exports paid for in free foreign exchange or for such services rendered in India Rupees which are otherwise considered as having been paid for in free foreign exchange by RBI.
(g) Supplies of Information Technology Agreement (ITA -1) items and notified zero duty telecom/ electronic items.
As per the guidelines of Foreign Trade Policy, all the EOU in India are free to sell the goods produced in the EOU units in the Domestic Traffic Area (DTA). For old existing EOUs the limit has been set up to the 1% of the EOUs previous year’s exports. However in case where the company is new and first time going into production under the EOU scheme, the limit has been set up to maximum of Rs. 10 lakhs, which means the EOU is free to sell goods in the domestic market up to Rs. 10 lakhs.
The most important thing is that all the EOUs are also allowed to market and sell their samples into DTA without payment of duty on returnable basis for the purpose of display/market promotion.
for more info:
http://www.smeindia.net/export_schemes/DOCS/B-1/EXPORT%20ORIENTED%20UNIT%20SCHEME.pdf
Units, other than gems and jewellery units, may sell goods upto 50% of FOB value of exports subject to fulfillment of positive NFE on payment of concessional duties . Within the entitlement of DTA sale, the unit may sell in DTA its products similar to the goods which are exported or expected to be exported from the units. No DTA sale at concessional duty shall be permissible in respect of motor cars, alcoholic liquors, books and tea (except instant tea) or by a packaging/ labeling /segregation/ refrigeration unit/ compacting/micronisation/pulverization/granulation /conversion of mono-hydrate form of chemical to anhydrous form or vice-versa and such other items as may be notified from time to time.
Sales made to a unit in SEZ shall also be taken into account for the purpose of arriving at FOB value of export by EOU provided payment for such sales are made from EEFC Account. Sale to DTA would also be subject to mandatory requirement of registration of pharmaceutical products (including bulk drugs).
as per current foreign trade policy.
Noted :
Following supplies effected from EOU/EHTP/STP/BTP units to DTA will be counted for the purpose of fulfillment of positive NFE:
(a)
Supplies effected in DTA to holders of advance licence, advance licence for annual requirement/DFRC /EPCG scheme.
(b)
Supplies effected in DTA against payment from the Exchange Earners Foreign Currency (EEFC) Account of the buyer in the DTA or against foreign Exchange remittance received from overseas.
( c)
Supplies to other EOU/EHTP/STP//BTP/SEZ units provided that such goods are permissible for procurement in terms of paragraph 6.2 of the Policy.
(d) Supplies made to bonded warehouses set up under the policy and/ or under section 65 of the customs act and free trade and warehousing zones, where payment is received in foreign exchange.
(e) Supplies of goods and services to such organizations which are entitled for duty free import of such items in terms of general exemption notification issued by the Ministry of Finance .
(f) Supply of services (by services units) relating to exports paid for in free foreign exchange or for such services rendered in India Rupees which are otherwise considered as having been paid for in free foreign exchange by RBI.
(g) Supplies of Information Technology Agreement (ITA -1) items and notified zero duty telecom/ electronic items.
As per the guidelines of Foreign Trade Policy, all the EOU in India are free to sell the goods produced in the EOU units in the Domestic Traffic Area (DTA). For old existing EOUs the limit has been set up to the 1% of the EOUs previous year’s exports. However in case where the company is new and first time going into production under the EOU scheme, the limit has been set up to maximum of Rs. 10 lakhs, which means the EOU is free to sell goods in the domestic market up to Rs. 10 lakhs.
The most important thing is that all the EOUs are also allowed to market and sell their samples into DTA without payment of duty on returnable basis for the purpose of display/market promotion.
for more info:
http://www.smeindia.net/export_schemes/DOCS/B-1/EXPORT%20ORIENTED%20UNIT%20SCHEME.pdf
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