ADVANCE LICENCE OF PLASTIC PRODUCT

[abhishek Agarwal]

Dear Sir,

We would like to know the your opinion on below matter.

For exports of finished plastics goods advance licence is being issued by DGFT under which Import of duty free raw meterial is to be done & from that you can manufacture goods & export it.

My question is for example if for exports the domestic duty paid raw material is being used & exported (govt export obligation is fulfiled prior to import of duty free raw material) after the exports are done, can we import raw material & sell it on domestic market? The GST will be charged & will be paid.

Is it ok to sell the material in domestic market?

The problem here is the domestic raw material which was purchased to manufacture goods for exports so the difference of duty is a blocked funds from our costing which was calculated at the time of taking the orders.

Regards

Abhishek

[KASTURI SETHI]

No. You can import material after exports but cannot sell in domestic market as per Advance Authorisation conditions.

[CSSANJAY MALHOTRA]

Imports can be made after exports but the same has to be used for manufacture of FG which can be sold in domestic market on payment of GST. This is allowed under FTP.

You could have explored other options such as Refund of ITC where the goods are exported under Bond / LUT so that the funds may not be blocked even if the export clearances have been made under AA.

[Raghunandhaanan rvi]

You may refer Para 4.27 of Hand Book Procedure

AI Summary

Import Duty-Free Raw Materials Under Advance License: Domestic Sale Restrictions and Alternatives Explained An individual inquired about the possibility of importing duty-free raw materials under an advance license after fulfilling export obligations using domestically purchased materials, and then selling those imported materials in the domestic market. The responses clarified that although imports can be made after exports, selling in the domestic market is not permissible under Advance Authorization conditions. An alternative suggested was using the imported materials to manufacture finished goods for domestic sale, subject to GST. Another response recommended exploring refund options for Input Tax Credit to avoid blocked funds.