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EXPORT ORIENTED UNITS (EOUs), ELECTRONICS HARDWARE TECHNOLOGY PARKS (EHTPs), SOFTWARE TECHNOLOGY PARKS (STPs) SCHEME AND BIO-TECHNOLOGY PARKS (BTPs).

Chapter 6 - Procedure - Foreign Trade Procedure - Foreign Trade Procedure 2015-2020 (From 5-12-2017 to 31-3-2020) Revised - Chapter 6 - CHAPTER 6 6.00 Scheme Policy relating to EOUs, EHTPs, STPs and BTPs Schemes is given in Chapter 6 of Foreign Trade Policy (FTP). 6.01 Application / Approval / Renewal of approval (a) For setting up an EOU, three copies of application as in ANF 6 A of Appendices & ANFs may be submitted to DC. (b) (i) Applications for setting up units under EOU scheme shall be .....

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enable the Unit to construct the plant & install the machinery and by this time the unit should have commenced production. In case the unit is not able to commence production in initial validity of 2 years, an extension of one year may be given by the DC for valid reasons to be recorded in writing. Subsequent extension of one year may be given by the Unit Approval Committee subject to condition that two thirds of activities including construction, relating to the setting up of the Unit are .....

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pendices & ANFs) and Department of Industrial Policy and Promotion within 45 days on merits. (d) STP / EHTP complexes can be set up by Central Government, State Government, Public or Private Sector Undertakings or any combination thereof, duly approved by Inter-Ministerial Standing Committee (IMSC) in Ministry of Communication and Information Technology (Department of Electronics & Information Technology - DeitY). Application for setting up EHTP / STP unit shall be in format prescribed b .....

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oP / LoI shall specify item(s) of manufacture / service activity, annual capacity, projected annual export for first five years in dollar terms, Net Foreign Exchange (NFE) earnings, limitations, if any, regarding sale of finished goods, by-products and rejects in DTA and such other matter as may be necessary and also impose such conditions as may be required. (g) LoP / LoI issued to EOU / EHTP / STP / BTP units by concerned authority would be construed as an authorization for all purposes. Stand .....

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ided for in Paragraph 6.05 of FTP, it shall be open to unit to continue under scheme or opt out of scheme. Where unit opts to continue, DC will extend approval period. If no intimation in this regard is received from unit within a period of six months of expiry of approval period, DC will take action, suo motu, to cancel approval under EOU scheme and take further action in this regard. Where units give their option to continue after expiry of six months as stipulated above, DC will grant extensi .....

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orts and DTA sale shall not be permitted by DC. 6.03 Export of Goods and Services (a) Software units may undertake exports using data communication links or in form of physical exports (which may be through courier service also), including export of professional services. (b) EOUs shall be permitted to export jewellery on basis of a notional rate certificate issued by nominated agency. This rate will be based on prevailing Gold / US$ rate and US$ / INR rate in notional rate certificate. Certific .....

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ing goods generated out of partial processing / manufacture. Besides, supply of unsuitable / broken cut and polished diamonds, precious and semi-precious stones upto 5% of value of imported or indigenously procured goods to DTA against valid Gems & Jewellery REP as applicable on payment of appropriate duty is also permitted. 6.04 Import / Domestic Procurement of Goods Goods permitted to be imported / procured from DTA shall include: (a) Raw materials, components, consumables, intermediates, .....

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e, computer furniture, anti- static carpet, teleconference equipment, Servo Control System, Air-conditioners / Air conditioning system, panel for electricals and special data transmission cable. (6) Security Systems (7) Tools, jigs, fixtures, gauges, moulds, dyes, instruments and accessories. (c) Raw materials for making capital goods for use within unit. (d) Others including: (1) Prototypes and technical samples for existing product(s) and product diversification development or evaluation. (2) .....

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to following conditions: (a) Goods shall be imported into EOU / EHTP / STP / BTP premises. However, agriculture and allied sectors and granite sector units in EOU may supply / transfer capital goods and inputs in farm / fields / quarries with prior intimation to jurisdictional Customs authorities, provided ownership of goods rests with EOUs. Granite sector would also be allowed to take spares upto 5% of value of Capital Goods to quarry site. (b)Procedure as prescribed under Customs/Central Exci .....

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the date on which first import consignment is cleared by Customs Authorities. (iii) Further, in case of import of spices for VA purpose like crushing / grinding / sterilization or for manufacture of oils and oleoresins of pepper, cardamom and chillies (and not for simple cleaning, grading, re-packing etc.), EO shall be fulfilled within 120 days from the date of importation of first consignment. In case of import of spices (other than pepper, cardamom and chillies) for manufacture of spice oils .....

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t Output Norms (SION) provided that: (i) where no SION have been notified, generation of waste, scrap and remnants upto 2% of input quantity shall be allowed; (ii) where additional items other than those given in SION are required as inputs or where generation of waste, scrap and remnants is beyond 2% of input quantity, use of such inputs shall be allowed by the jurisdictional DC within a period of three months from the date of and based on self declared norms, with the unit undertaking to adjus .....

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authorities. (b) EOU / EHTP / STP / BTP units may, temporarily take out of premises of unit, duty and/or tax free laptop / computers and video projection systems for working upon by authorized employees. (c) EOU / EHTP / STP / BTP units may install personal computers not exceeding two in number, imported / procured duty and/or tax free in their registered / administrative office subject to DoR guidelines. (d) For IT and IT enabled services, persons authorized by software units may access facili .....

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t, which will be liable for any misuse. (iii) Export of the resultant products / services would take place only from the premises of the unit. 6.09 Leasing of Capital Goods Value of imported capital goods financed through leasing companies or obtained free of cost and / or on loan / lease basis, shall also be taken into account for purpose of calculation of NFE as defined in FTP. 6.10 Net Foreign Exchange (NFE) Earnings (a) EOU / EHTP / STP / BTP unit shall be a positive net foreign exchange ear .....

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n foreign exchange by way of commission, royalty, fees, dividends, interest on external borrowings / high sea sales during first five year period or any other charges. It will also include payment made in Indian Rupees on high sea sales. Inputs mean raw materials, intermediates, components, consumables, parts and packing materials. (b) If any goods are obtained from another EOU / EHTP / STP / BTP / SEZ unit, or procured from an international exhibition held in India, or bonded warehouses or prec .....

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10th year : 10%. Provided that above amortization rates would be applicable only if an undertaking is given by a unit that it will not exit to DTA in the first 10 years. For existing units, proportionate Customs and excise duty must be paid where NFE is less than depreciation already claimed, before exit. 6.11 Maintenance of Accounts (a) EOU / EHTP / STP / BTP unit shall maintain proper account, and shall file digitally signed quarterly and annual report as prescribed in Annexure to Appendix 6 E .....

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EOU / EHTP /STP / BTP units, sales in DTA and balance in stock. Any matter for clarification as to whether goods are homogenous or not shall be decided by Units Approval Committee. 6.12 Monitoring of NFE Performance of EOUs shall be monitored by Units Approval Committee as per guidelines given in Appendix 6 F of Appendices & ANFs. Performance of EHTP / STP / BTP shall be monitored by DeitY / DoBT jointly with jurisdictional Customs authority. 6.13 Conversion of Scrap / Dust / sweeping of Go .....

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on basis of gold / silver / platinum content, as may be notified by Customs authorities. 6.14 DTA Supplies Notwithstanding provision of DTA sales in Paragraph 6.08 of FTP, such DTA sales shall not affect application, to any goods, of any other prohibition or regulation affecting import thereof in force at the time, when such goods are imported. This also does not confer any immunity, exemption or relaxation at any time from any commitment or compliance with any requirements to which importer ma .....

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dices & ANFs. 6.17 Supply of Precious / Semiprecious / Synthetic Stones from DTA Supplier of precious and semi-precious stones, synthetic stones and processed pearls from DTA to EOUs shall be eligible for grant of Replenishment Authorisation at rates and for items mentioned in HBP. Procedure for submission of application for grant of Replenishment Authorisation as contained in relevant Chapter of HBP Vol. I shall be applicable. However, application shall be made to DC concerned. Such supplie .....

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. (b) Level of NFE or any other conditions relating to imports and exports as prescribed shall continue to be discharged by EOU / EHTP / STP / BTP unit concerned. (c) Export orders so procured shall be executed within parameters of EOU / EHTP / STP / BTP schemes and goods shall be directly transferred from unit to port of shipment. (d) Fulfilment of NFE by EOU / EHTP / STP / BTP units in regard to such exports shall be reckoned on basis of price at which goods are supplied by EOUs to other expor .....

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ing Export House and Trading House status. (b) Sectoral norms as notified by Government shall apply to FDI in service activities. (c) STP Units / EHTP Units / Software EOUs may also use all duty and/or tax free equipment / goods for training purpose (including commercial training), subject to condition that no duty free equipment / goods shall be installed outside premises of the unit for this purpose. (d) Export of iron ore shall be subject to decision of Government. Requirements of other condi .....

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n regard to use of timber / other wood. 6.21 Sub - Contracting (a) Sub - contracting by EOU gems and jewellery units through other EOUs, or SEZ Units, or units in DTA shall be subject to following conditions:- (i) Goods, finished or semi finished, including studded jewellery, taken out for sub - contracting shall be brought back to unit within 90 days. (ii) No cut and polished diamonds, precious and semiprecious stones (except precious, semi- precious and synthetic stones having zero duty) shall .....

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deemed export benefits under Chapter 7 of FTP. (b) Facility of getting job work done from DTA unit will be available subject to condition that goods are brought back to premises of unit on completion of job work. (c) Export of finished goods from job worker s premises may be permitted, provided such premises are registered with Central Excise/GST authorities. Where job worker is SEZ / EOU / EHTP / STP / BTP unit, export may be effected either from job worker s premises or from premises of unit. .....

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oduction process abroad, goods may be exported from sub - contractor premises subject to conditions that at the time of clearance of goods, the EOU / EHTP / BTP / STP unit shall declare (i) the transaction value of the finished goods to be cleared from the sub - contractor s premises abroad; (ii) job work charges to be paid to the sub - contractor abroad; and (iii) value of intermediate goods; supported with documents like (a) sale price contract / or invoice for the finished goods, (b) job work .....

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ix 6 I of Appendices & ANFs) to DTA farm subject to following conditions: (a) Supply of inputs by EOUs to contract farm(s) shall be subject to input-output norms approved by DGFT / BOA. (b) There shall be contract farming agreement between EOU and DTA farmer(s). (c) Unit has been in existence for at least two years and engaged in export of agriculture / horticulture / aquaculture products; otherwise it shall furnish bank guarantee equivalent to duty and/or taxes foregone on capital goods / i .....

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ucts shall also be submitted. (b) In case of re - import, such items, on arrival shall be verified along with export documents before clearance (c) Items not sold abroad shall be re - imported within 60 days of close of exhibition. However, in case exporter is participating in more than one exhibition within 45 days of close of first exhibition, then 60 days shall be counted from date of close of last exhibition. In case of exhibition in USA, the time period shall be 90 days instead of 60 days m .....

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permitted with approval of DC subject to following conditions: (a) EOU shall bring back goods or repatriate sale proceeds within 45 days from date of departure through normal banking channel. (b) Unit shall declare personal carriage of such samples to Customs while leaving country and obtain necessary endorsement. 6.25 Export through Show-rooms abroad / Duty free shops Export of goods is also permitted for display / sale in permitted shops set up abroad or in showrooms of their distributors / ag .....

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r Personal carriage of jewellery by foreign bound passenger, following documents shall be submitted by EOUs as proof of exports: (i) Copy of shipping bill filed by EOUs; (ii) A copy of Currency Declaration Form filed by Foreign buyer with Customs at time of his arrival; and (iii) Foreign Exchange Realisation / Encashment Certificate from Bank. (b) In addition to this, Personal Carriage by foreign bound passenger on Document Against Acceptance (DA) / Cash On Delivery (COD) basis is also allowed. .....

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ngers shall be allowed in case same are required for repairs of exported goods at customer site. Following documents should be submitted as proof of exports: (i) Permission letter from Customs for exports. (ii) Invoice with value (for payment or free of charge). 6.28 Replacement / Repair of Imported / Indigenous Goods (a) Units may send capital goods abroad for repair with permission of Customs authorities. Any foreign exchange payment for this purpose will also be allowed. However, no permissio .....

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able undertaking to Customs for return of goods. However, if goods have been consumed / destroyed in process of testing etc. a certificate from laboratory / institution to this effect be furnished to Customs. 6.29 Samples (a) EOU / EHTP / STP / BTP units may on basis of records maintained by them, and on prior intimation to Customs authority, supply or sell samples in DTA for display / market promotion on payment of excise duty, if applicable, and/or payment of GST and compensation cess alongwit .....

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tutory requirement of Stability & Retention sample with manufacturer, an EOU / EHTP / BTP / STP unit may re- import with or without payment of duties/taxes as provided at para 6.01(d)(ii) of FTP those samples, which were exported by it, under intimation to Custom Authorities, and FOB value of such samples shall not be counted for NFE purpose and other export benefits, if any. (d) An EOU, on basis of records maintained by them and on prior intimation to Customs authorities, may send samples t .....

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its, to a school run by Central Government, or Government of a State or, a Union Territory or, a local body; an Educational Institution run on non-commercial basis by any organization; a Registered Charitable Hospital; a Public Library; a Public Funded Research and Development Establishment; a Community Information Center run by Central Government or, Government of a State or, a Union Territory or local body; an Adult Education Center run by Central Government or, Government of a State or, a Uni .....

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sh imports and exports or supplies effected by EOU / EHTP / STP / BTP units from those made by other units of enterprise. 6.32 Unit Approval Committee for EOUs (a) Composition of Unit Approval Committee shall be as under: Development Commissioner : Chairperson Jurisdictional Commissioner of Central Excise & Customs or nominee : Member Joint DGFT or nominee : Member Joint/Deputy Development Commissioner of the Zone : Member Any other nominee of any Department / Agency as special invitee (b) P .....

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call for information required to monitor performance of unit under permission, clearances, licenses granted to it; (vi) to perform any other function delegated by Central Government or its agencies; (vii) to perform any other function as may be delegated by State Governments or its agencies; and (viii) to grant all approvals and clearances for establishment and operation of EOUs 6.33 Approval of EHTP / STP / BTP Units In case of units under EHTP / STP scheme, necessary approval / permission sha .....

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ts as laid down in Appendix 6 A of Appendices & ANFs. 6.34 Administration of EOUs / Powers of DC / Designated Officer DC / Designated Officer shall have following powers in respect to units. Jurisdiction of DC is given in Appendix 6 J of Appendices & ANFs. (1) Conversion of sick / closed DTA unit into EOU; (2) Conversion of EOU to STP / EHTP / BTP and vice-versa as per prescribed procedure; (3) To allow increase in value of capital goods in terms of Indian Rupees, on account of foreign e .....

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of location from place mentioned in LoP to another and / or include additional location provided that no change in other terms and conditions of approval is envisaged and that new location is within territorial jurisdiction of DC / Designated Officer; (8) Extend validity period of LoP beyond initial validity period of LoP (except in case where there is a restriction on initial period of approval, like setting up of oil refinery projects) as per Paragraph 6.05 (a) of FTP; (9) Cancel LoP wherever .....

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r AP (DIR series Circular No.9 dated 25.10.2001); (13) Issue eligibility certificates for grant of employment visa to low level foreign technicians to be engaged by EOUs as per Ministry of Home Affairs letter No. 25022 / 7 / 99- F.1 dated 20.9.1999; (14) Registration - cum - Membership Certificate Function as a Registering authority for EOU / EHTP / STP / BTP unit. A separate Registration - cum - Membership Certificate shall not be required in their cases as provided for in Paragraph 2.44 of FTP .....

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ty of EOU / EHTP / STP / BTP Scheme under their jurisdiction. 6.35 Change of Location / Inclusion of Additional Location with BOA Approval BOA may consider change of location of EOU / EHTP / STP / BTP unit from place mentioned in LoP to another and / or to include additional location outside territorial jurisdiction of original DC / Designated Officer, subject to such conditions as BOA may decide. 6.36 Clearance of Capital Goods in DTA Clearance of capital goods, including second hand, in DTA sh .....

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very quarter in fourth and fifth year. (b) Depreciation Norms for Other Capital Goods: For capital goods, other than above, depreciation rate would be as follows: 4% for every quarter in first year; 3% for every quarter in second and third year; 2.5% for every quarter in fourth and fifth year; 2% for every quarter thereafter. 6.38 Conversion (a) Existing DTA units, may also apply for conversion into an EOU /EHTP / STP / BTP unit, but no concession in duties and taxes would be available under sch .....

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il permissible exemption in duties and taxes as applicable under relevant scheme. EHTP / STP / BTP units desiring conversion as an EOU may apply to DC concerned through Officer designated by DeitY / DoBT in same manner as applicable to new units. Likewise, EOU desiring conversion into EHTP / STP / BTP may apply to officer designated by DeitY / DoBT through DC concerned. (c) An EOU may be shifted to SEZ with approval of DC provided EOU has achieved pro-rata obligation under EOU scheme. 6.39 Reviv .....

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go at port of import. However, jurisdictional Commissioner of Customs may examine consignments at unit s place on random basis. (c) Deleted (d) Installation of Fax Machine / Computers: Eligible EOUs may install one fax machine and two computers in their administrative / registered office outside premises of the unit under prior intimation to jurisdictional Asstt. / Deputy Commissioner of Customs . (e) Procurement of DG sets: Procurement of DG set of capacity commensurate with actual requirement .....

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om DC / Customs. (h) Activities which do not require permission: In respect of following activities of a status holder, permission will not be required from DC or jurisdictional Central Excise/Customs authority: DTA sale of finished products in terms of Paragraph 6.08(a) of FTP; Participation in exhibition and Personal carriage of Gems & Jewellery for export promotion tours subject to fulfilment of conditions of Paragraph 6.24 of HBP. However, prior intimation thereof needs to be given. 6.41 .....

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