Duty Free Replenishment Certificate is issued to a merchant-exporter or
manufacturer-exporter for the import of inputs used in the manufacture
of goods without payment of Basic Customs Duty, Surcharge and Special
Additional Duty. However, such inputs shall be subject to the payment of
Additional Customs Duty equal to the Excise Duty at the time of import.
i). Duty Free Replenishment Certificate shall be issued only in
respect of export products covered under the SIONs as notified by
DGFT. However, DFRC shall not be issued in respect of SIONs which are subject to "actual
user" condition in the Hand book of Procedures (Vol-II).
(above i) has been amended vide Ntf. No. 18(RE-00)/1997-2002, dt. 1-6-2000)
ii). Duty Free Replenishment Certificate shall be issued for import of
inputs, as per SION, having same quality, technical
characteristics and specifications as those used in the end
product and as indicated in the shipping bills. The validity of
such licences shall be 12 months. DFRC and or the material
imported against it shall be freely transferable.
iii). The Duty Free Replenishment Certificate shall be subject to a
minimum value addition of 33%
iv). The export products, which are eligible for modified VAT, shall
be eligible for CENVAT credit owever, non excisable, non dutiable
or non centrally vatable products, shall be eligible for drawback
at the time of exports in lieu of additional customs duty to be
paid at the time of imports under the scheme.
v). The exporter shall be entitled for drawback benefits in respect
of any of the duty paid materials, whether imported or
indigenous, used in the export product as per the drawback rate
fixed by Directorate of Drawback (Ministry of Finance). The
drawback shall however be restricted to the duty paid materials
not covered under SION.
vi)Duty Free Replenishment certificate may be issued in respect of exports for which payments
are received in non-convertible currency. Such exports shall, however, be subject to value
addition as specified in Appendix- 39 of Handbook (Vol.1)
(Sl. No.(vi) has been added vide Ntf. No. 28(RE-00)/1997-2002, dated 3-8-2000)