SEZ UNIT MEIS LICENCE SALE IN DTA MARKET

[Asked by Guest]

Dear sir, We are in the SEZ Manufacturing unit, and granted MEIS scrip for our export. this scrip sale in DTA market. GST exempted for Scrip sale. As we are SEZ, any sale from SEZ to DTA market applicable custom duty. please clarify whether we can liable to pay custom duty for our MEIS Scrip sale in DTA market

[KASTURI SETHI]

For items covered under the GST, MEIS duty credit scrips can be used for payment of Basic Customs Duty, Safeguard Duty, Transitional Product Specific Safeguard Duty, and Anti-dumping Duty.

For items not covered under the GST (specified in Fourth Schedule to Central Excise Act, 1944 covering specified petroleum products, tobacco etc.), in addition to the Basic Customs Duty, Safeguard Duty, Transitional Product Specific Safeguard Duty, and Anti-dumping Duty, MEIS duty credit scrip can also be used for payment of duties like Central Excise, CVD/SAD. The scrip cannot be used for payment of any type of GST. The Duty Credit Scrip cannot be used for payment of IGST and GST Compensation Cess on imports, and CGST, SGST, IGST and GST Compensation Cess for domestic procurement.

For more details see Trade Notice No.11/2018/30-6-2017 issued by DGFT.

[Rajendra Prasad]

Dear Sir,

The question is on applicability of Customs Duty on Sale on MEIS Scripts by SEZ unit to DTA unit.

But reply seems to be how to use MEIS / for which purpose MEIS can be used.

Could you please give more clarity.

Yes Rajendra Prasad Sir, MEIS Scrip Sale by SEZ to Indian Market, whether custom duty applicable or not?

[Malay pota]

If the MEIS script /licence is a goods as per the definition of GOODS under the CUSTOMS Act then if SEZ sale its MEIS to DTA Customs import duty will be applicable otherwise NOT.

Further is applicable only buyer (so called Importer ) is required to pay Import Customs duty and not the seller (So called exporter).

[KASTURI SETHI]

'May I suggest ? 'Deemed importer' and 'deemed exporter' are proper words here instead of ' so-called'. With regards

[Raghunandhaanan rvi]

Sir,

In terms of Section 30 (a) of SEZ Act 2005, Customs duty is payable on any goods that removed from SEZ to DTA .

Further, Goods includes any kind of moveable property as per section 2(22) of Customs Act 1962.

Thanks

[Malay pota]

"Deemed export" means the supply made to the categories specified in Para 7.02 of FTP.In the said specified categories supply to by SEZ to DTA or DTA to SEZ does not appear so the said supply can not say DEEMED Export. So far as concerned the word DEEMED Import,as per my knowledge the said word is not available in the FTP,HB of FTP Customs Act or any Allied Acts too.However if we take that if there is DEEMED Export in FTP the buyer of Deemed export MAY BE considered as DEEMED Importer.

However it should not be forgot here that any supply made to and by SEZ to DTA of DTA to SEZ it is a DIRECT EXPORT and NOT a DEED Export.

AI Summary

Customs duty may attach to MEIS scrip sales into domestic market; buyer/importer typically bears the liability under SEZ rules.
Sale of an MEIS duty credit scrip into the DTA may attract customs duty if the scrip is characterised as "goods" under the Customs Act; MEIS scrips are usable for specified customs duties but not for GST or GST cess. Any customs duty on removal from SEZ to DTA is payable in practice by the acquiring party treated as importer, and SEZ-DTA transfers are distinct from "deemed export" treatments under the foreign trade policy.