4.42
Export Obligation (EO) Period and its Extension
(a) Period for fulfillment of export obligation under Advance Authorisation shall be 18 months from the date of issue of Authorisation. Period of EO fulfillment under an Advance Authorisation shall commence from date of issue of Authorisation, unless otherwise specified.
(b) In cases of supplies to projects in India under Chapter-7 of FTP or projects abroad, the Export Obligation period shall be coterminus with contracted duration of the project execution or 18 months whichever is more.
(c) Export Obligation for items falling in categories of defence, military store, aerospace and nuclear energy shall be 24 months from the date of issue of authorization or co-terminus with contracted duration of the export order whichever is more.
(d) Extension in export obligation period for Authorisations issued under Appendix-4J (issued under FTP 2015-20) shall be allowed for a period not more than the half of the stipulated export obligation period. In such cases, composition fee shall be levied @ 0.5% per month of unfulfilled FOB value, in case exports effected are more than 50% within initial Export Obligation period and @ 1% per month where less than 50% exports have been effected within initial export obligation period.
(e) Regional Authority may consider a request of Advance Authorisation holder for one extension of EO period upto six months from the date of expiry of EO period subject to payment of composition fee of 0.5% of the shortfall in EO. Authorisation holder will have to submit a self declaration to RA stating that unutilised imported/domestically procured inputs are available with the applicant.
(f) Request for further extension of six months after first extension as in (b) above can be considered by Regional Authority, provided Authorisation holder has fulfilled minimum 50% export obligation in quantity as well as in value, on pro-rata basis. This will be subject to payment of composition fee @ 0.5% per month on unfulfilled FOB value of export obligation. No further extension shall be allowed by Regional Authority. This provision shall also be applicable to Advance Authorisations issued during FTP 2009-2014. However, only two extensions of six months each as mentioned above can be allowed subject to payment of composition fee and under no circumstance Regional Authority shall allow any extension beyond 12 months from date of expiry of EO period. At the time of filing application for second EO extension, the Authorisation holder will have to submit a self declaration to RA stating that unutilised imported/domestically procured inputs are available with the applicant.
(g) Deleted.
(h) Whenever a ban / restriction is imposed on export of any product, export obligation period in respect of Advance Authorisation already issued prior to imposition of ban, would stand automatically extended for a period equivalent to the duration of ban, without any composition fee.
(i) For all Advance Authorisations where the Export Obligation period is expiring between 01.02.2020 and 31.07.2020, the Export Obligation period stands automatically extended by six months from the date of expiry. No separate application with composition fee, amendment or endorsement is required for this purpose. The option to avail further validity extensions under this para beyond this period would remain available for these authorisations as per eligibility.
(Above sub para (i) has been added vide PUBLIC NOTICE NO. 67/2019, DT. 31/03/2020)
(j) a. For Advance Authorisations, where original or extended Export Obligation (EO) period is expiring during the period between 01.08.2020 and 31.07.2021, the Export Obligation period would be extended till 31.12.2021 without any composition fees. However this extension is subject to 5% additional export obligation in value terms (in free Foreign Exchange) on the balance Export Obligation on the date of expiry of the original/extended export obligation period.
b. The option to avail EO extensions with payment of composition fees under this para (4.42 (d),(e),(f)) would remain available for these authorizations as per eligibility.
c. In cases where Advance Authorisation Holder has already obtained EO extension upon the payment of composition fee, the refund of the composition fee will not be permitted.
(Above (j) has been added vide NOTIFICATION NO. 28/2021, DT. 23/09/2021)