CHAPTER 5
EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME
5.1
Zero Duty EPCG Scheme
(a) Zero duty EPCG scheme allows import of capital goods (including CKD/SKD thereof as well as computer software systems) for pre-production, production and post-production at zero Customs duty, subject to an export obligation equivalent to 6 times of duty saved on capital goods imported under EPCG scheme, to be fulfilled in 6 years reckoned from Authorization issue-date.
(b) Zero duty EPCG scheme shall not be available to exporters, who avail in that year, the benefit of Status Holder Incentive Scheme under Paragraph 3.16 of FTP. In case they have already availed SHIS benefit they would be eligible for Zero Duty Scheme if they surrender or refund SHIS, with applicable interest in case SHIS has been utilized.
(c) In case countervailing duty (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.
(d) Capital Goods shall include spares (including refurbished/reconditioned spares), tools, jigs, fixtures, dies and moulds.
(e) Second hand capital goods shall not be permitted to be imported under EPCG Scheme.
(f) Import of Restricted items of imports mentioned under ITC (HS) shall only be allowed under EPCG Scheme after approval from EFC at Headquarters.
(g) Authorization under EPCG Scheme shall not be issued for import of any Capital Goods (including Captive plants and Power Generator Sets of any kind) for
i. Export of electrical energy (power)
ii. Supply of electrical energy (power) under deemed exports
iii. Use of power (energy) in their own unit, and
iv. Supply/export of electricity transmission services.”
(Above new sub-para (g) has been inserted vide NOTIFICATION NO. 07/2013, DT. 18/04/2013)
(This version of Chapter 5 of the Foreign Trade Policy deals with policy provisions for Export Promotion Capital Goods (EPCG) Scheme replace by
NOTIFICATION NO. 01/2013, DT. 18/04/2013 with immediate effect.)
[OLD - CHAPTER 5
EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME
5.1
Zero Duty EPCG Scheme
(a) Zero duty EPCG scheme allows import of capital goods for preproduction, production and post production (including CKD/SKD thereof as well as computer software systems) at zero Customs duty, subject to an export obligation equivalent to 6 times of duty saved on capital goods imported under EPCG scheme, to be fulfilled in 6 years reckoned from Authorization issue-date.
(b) The scheme will be available for exporters of engineering & electronic products, basic chemicals & pharmaceuticals, apparels & textiles, plastics, handicrafts, chemicals & allied products, leather & leather products, paper & paperboard and articles thereof, ceramic products, refractories, glass & glassware, rubber & articles thereof, plywood and allied products, marine products, sports goods and toys.
(c) However, zero duty EPCG Scheme shall not be available for import of capital goods relating to export of products covered under following chapters / headings of ITC(HS) classification:
(i) Chapters 1, 2, 4 to 24, 25 to 27, 31, 43, 44 (except plywood and allied products), 45, 47, 68, 71, 81 (metals in primary and intermediate forms only), 89, 93, 97, 98.
(ii) ITC(HS) 4011 to 4013, ITC(HS) 7401 to 7406, 7501 to 7504, 7601 to 7603, 7801,7802, 7901 to 7903, 8001, 8002 and 8401. However, zero duty EPCG Scheme will be available for handicraft exports under Chapters 5, 68, 97.
(d) Zero duty scheme shall also not be available for units who are currently availing any benefits under Technology Upgradation Fund Scheme (TUFS) administered by Ministry of Textiles, Government of India.
(e) Zero Duty Scheme shall also be available to such exporters who may have obtained benefit under TUFS
(i) but the exact line of business in TUFS (say cotton yarn) is different from the line of business under EPCG (say machinery for blast furnace); or
(ii) if the exporter refunds such benefits availed under TUFS with applicable interest, before availing EPCG.
(f) Zero duty EPCG scheme shall not be available to exporters, who avail in that year, the benefit of Status Holder Incentive Scheme under Paragraph 3.16 of FTP. In case they have already availed SHIS benefit they would be eligible for Zero Duty Scheme if they surrender or refund SHIS on similar lines as given at (e) (ii) above.
(g) All other provisions pertaining to concessional 3% duty EPCG scheme under this Chapter, to the extent they are not inconsistent with the above provisions of zero duty EPCG scheme, shall be applicable to the zero duty EPCG scheme also.
(h) The zero duty EPCG scheme shall be in operation till 31.3.2013, unless decided otherwise.