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EXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEME

Chapter 5 - Policy - Foreign Trade Policy - DGFT - Chapter 5 - CHAPTER 5 5.00 Objective The objective of the EPCG Scheme is to facilitate import of capital goods for producing quality goods and services to enhance India s export competitiveness. 5.01 EPCG Scheme 4[(a) EPCG Scheme allows import of capital goods for pre-production, production and post-production at Zero customs duty. Capital goods imported under EPCG scheme for physical exports are also exempt from whole of the Integrated Tax and .....

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SKD condition thereof; ii. Computer software systems; iii. Spares, moulds, dies, jigs, fixtures, tools & refractories for initial lining and spare 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. 5[(c) Import under EPCG Scheme shall be subject to an export obligation equivalent to 6 times of duties, taxes and cess saved on capital .....

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nerator Sets of any kind) for:] (i) Export of electrical energy (power) (ii) Supply of electrical energy (power) under deemed exports 2[(iii) Supply of power (energy) in their own unit, and] (iv) Supply/export of electricity transmission services (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 fo .....

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rting manufacturer (s). In case of any change in supporting manufacturer (s) the RA shall intimate such change to jurisdictional Central Excise Authority of existing as well as changed supporting manufacturer (s) and the Customs at port of registration of Authorisation. (b) also covers a service provider who is designated / certified as a Common Service Provider (CSP) by the DGFT, Department of Commerce or State Industrial Infrastructural Corporation in a Town of Export Excellence subject to pro .....

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(iii) Authorisation holder shall be required to submit Bank Guarantee (BG) which shall be equivalent to the duty saved. BG can be given by CSP or by any one of the users or a combination thereof, at the option of the CSP. 5.03 Actual User Condition Import of capital goods shall be subject to Actual User condition till export obligation is completed. 5.04 Export Obligation (EO) Following conditions shall apply to the fulfilment of EO:- (a) EO shall be fulfilled by the authorisation holder throug .....

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an of export performance in the preceding three licensing years for same and similar products. (c) In case of indigenous sourcing of Capital Goods, specific EO shall be 25% less than the EO stipulated in Para 5.01. (d) Shipments under Advance Authorisation, DFIA, Drawback scheme or reward schemes under Chapter 3 of FTP; would also count for fulfillment of EO under EPCG Scheme. (e) Export shall be physical export. However, deemed exports as specified in paragraph 7.02 (a), (b), (e), (f) & (h) .....

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otified in Appendix 5D shall also be counted towards discharge of export obligation under the EPCG scheme. ] 5.05 Provision for units under BIFR /Rehabilitation A company holding EPCG authorisation and registered with BIFR / Rehabilitation Department of State Government or any firm/ company acquiring a unit holding EPCG authorisation which is under BIFR / Rehabilitation, may be permitted EO extension for the EPCG authorisation(s) held by the acquired unit, as per rehabilitation package prepared .....

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to units in Agri-Export Zones provided EPCG authorisation is taken for export of primary agricultural product(s) notified or their value added variants. 7[5.07 Indigenous Sourcing of Capital Goods and benefits to Domestic Supplier A person holding an EPCG authorisation may source capital goods from a domestic manufacturer. Such domestic manufacturer shall be eligible for deemed export benefit under paragraph 7.03 of FTP and as may be provided under GST Rules under the category of Deemed Exports. .....

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rts, in cases where Authorisation holder has fulfilled 75% or more of specific export obligation and 100% of Average Export Obligation till date, if any, in half or less than half the original export obligation period specified, remaining export obligation shall be condoned and the Authorisation redeemed by RA concerned. However no benefit under para 5.21 of HBP shall be permitted where incentive for early EO fulfilment has been availed. 5.10 Reduced EO for Green Technology Products For exporter .....

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e shall be no change in average EO imposed, if any, as stipulated in Para 5.04. 5.12 Post Export EPCG Duty Credit Scrip(s) (a) Post Export EPCG Duty Credit Scrip(s) shall be available to exporters who intend to import capital goods on full payment of applicable duties in cash and choose to opt for this scheme. (b) Basic Customs duty paid on Capital Goods shall be remitted in the form of freely transferable duty credit scrip(s), similar to those issued under Chapter 3 of FTP. (c) Specific EO shal .....

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t was read as, "(g) Authorisation under EPCG Scheme shall not be issued for import of any Capital Goods (including Captive plants and Power Generator Sets of any kind) for" 2. Substituted vide Not. 35/2015-2020 - Dated 29-1-2016 before it was read as, "(iii) Use of power (energy) in their own unit, and" 3. Substituted vide Not. 6/2015-2020 - Dated 3-5-2016, before it was read as, " (h) Payment received in rupee terms for such Services as notified in Appendix 3E shall als .....

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