Spares imported under Zero Duty EPCG Scheme - Installation certificate thereof - Customs - Import - Export - Customs - SEZ

[vinay wakde]

We have imported spares under zero duty Export Promotion of Capital Goods (EPCG) scheme. As per the Customs Notification No. 64/2008 – Customs dated 09.05.2008, the installation certificate for spares is required to be produced to Customs authorities within a period of three years from the date of importation. However, some of the spares are installed after lapse of three years for which the Excise authority is asking us to pay appropriate duty on these spares.

In the matter, kindly let us know whether all duty involved therein at relevant period such as [Customs duty (7.5%) + CVD (10%)+ Education cess (2%)+ SHE Cess (1%) + Edu Cess on Custom duty (2%) + SHE Cess on Custom duty (1%) + Special Additional duty (4%)] is required to bepaid for non compliance of the condition or only portion of CVD + SAD to be paid. Is there any case law, notification or circular for recovery of duty?

Your valuable advice for above query immensely help us to settle the matter.

AI Summary

Company Faces Duty Payment for Delayed Installation Under Zero Duty EPCG Scheme, Considers CENVAT Credit and Condonation Options A company imported spares under the Zero Duty EPCG Scheme but delayed installation beyond the three-year period required by Customs Notification No. 64/2008. The Excise authority is demanding payment of duties, including Customs duty, CVD, and other cesses. An advisor suggests paying the full deferred duties with interest but notes that CENVAT Credit can be claimed to mitigate financial impact. The advisor also recommends seeking condonation of delay from the DGFT redressal committee, which could help argue for leniency with Excise authorities. Another response advises seeking condonation from the EPCG Committee.