Interest on Raw Materials stock at the time of 100% EOU Exit

[SNEHAL SHAH]

Dear sir ,

We are manufacturing of Pharma product and recently ( before 6 Month ) , we got final Exit order from SEEPZ .

We have already paid duty amount on Raw Materials stock at the time of EOU exit with relevant Bill of entry assessed by Jurisdiction range officer Central Excise.

We have received Interest amount demanding letter from SEEPZ, on duty amount paid on these raw materials stock.

We have already used this input stock for production of FG and paid duty amount at the time of removal.

Can unit have to pay Interest amount on Raw materials stock ? Any provision please share .

Please give valuable feedback on this .

Regards,

SNEHAL SHAH

AI Summary

Interest on duty-exempt raw materials: duty on de-bonding stock is payable; requirement to pay interest remains disputed.
Dispute concerns whether interest is payable on duties assessed and paid on raw material stock at the time of EOU exit (de-bonding). The operative practice requires payment of duty on raw materials, WIP and finished goods when an EOU exits the scheme and clears such stocks domestically. Some contributors assert interest is payable for the period of exemption enjoyed, while others observe that the Foreign Trade Policy exit procedures and related rules require duty payment but do not expressly mandate interest.