5.01

EPCG Scheme

(a) EPCG Scheme allows import of capital goods (except those specified in negative list in Appendix 5 F) for pre-production, production and post-production at zero customs duty. Capital goods imported under EPCG Authorisation for physical exports are also exempt from IGST and Compensation Cess upto 31.03.2022 [OLD- 31.03.2019.]  [OLD- 01.10.2018] [OLD- 31.3.2018 ] only, leviable thereon under the subsection(7) and subsection (9) respectively, of section 3 of the Customs Tariff Act, 1975 (51 of 1975), as provided in the notification issued by Department of Revenue. Alternatively, the Authorisation holder may also procure Capital Goods from indigenous sources in accordance with provisions of paragraph 5.07 of FTP. Capital goods for the purpose of the EPCG scheme shall include:

(Above "31.03.2022" substituted vide NOTIFICATION NO. 33/2021, DT. 28/09/2021)

(In above (a) the Exemption from Integrated Tax and Compensation Cess under EPCG Scheme is extended upto 31.03.2020 vide NOTIFICATION NO. 57/2018, DT. 20/03/2019)

(In above (a) the Exemption from Integrated Tax and Compensation Cess under EPCG Scheme is extended upto 31.03.2019 vide NOTIFICATION NO. 35/2018, DT. 26/09/2018)

( In above para (a) Exemption from Integrated Tax and Compensation Cess under EPCG Scheme is extended upto 01.10.2018 vide NOTIFICATION NO. 54/2017, DT. 22/03/2018 )

(i) Capital Goods as defined in Chapter 9 including in CKD/SKD condition thereof;

(ii) Computer systems and software which are a part of the Capital Goods being imported;

(iii) Spares, moulds, dies, jigs, fixtures, tools & refractories; and

(iv) Catalysts for initial charge plus one subsequent charge.

(b) Import of capital goods for Project Imports notified by Central Board of Excise and Customs is also permitted under EPCG Scheme.

(c) Import under EPCG Scheme shall be subject to an export obligation equivalent to 6 times of duties, taxes and cess saved on capital goods, to be fulfilled in 6 years reckoned from date of issue of Authorisation.

(d) Authorisation shall be valid for import for 18 months from the date of issue of Authorisation. Revalidation of EPCG Authorisation shall not be permitted.

(e) In case Integrated Tax and Compensation Cess are paid in cash on imports under EPCG, incidence of the said Integrated Tax and Compensation Cess would not be taken for computation of net duty saved provided Input Tax Credit is not availed.

(f) Deleted.

(g) Deleted.

(h) Import of items which are restricted for import shall be permitted under EPCG Scheme only after approval from Exim Facilitation Committee (EFC) at DGFT Headquarters.

(i) If the goods proposed to be exported under EPCG authorisation are restricted for export, the EPCG authorisation shall be issued only after approval for issuance of export authorisation from Exim Facilitation Committee at DGFT Headquarters.