EPCG License taken by EOU

[Govinda Raju]

Hi

We are 100% Export oriented unit. We have initiated to exit EOU and consequently applied for EPCG license for capital goods imports being a major exporter. However, subsequently company has delayed to exit and now shelved the plan. Now, to close EPCG license, DGFT insisting for closure certificate or pay the duty with Penalty suggesting contravention of act. However, there is no leak of duty revenue, we have complete record of export related to EPCG license though we are an EOU. From the perspective of regulatory there is definitely not a double benefit of export scheme availed then how there will loss of revenue to the government. Can I please have your views.

Thanks

Raju

AI Summary

EPCG license compliance: clarify export records or obtain NOC to avoid regulatory penalties for EOU related discrepancies.
Maintain clear bifurcation of goods and export records between the EPCG authorization and EOU obligations; if still an EOU, apply to subsume the EPCG export obligation with EOU obligations and obtain NOC from the Development Commissioner before closure; if in DTA, provide distinct export evidence that EPCG obligations were separately fulfilled. An EPCG authorization unused may be surrendered prior to expiry of the export obligation period, but authorizations against which imports were made cannot be surrendered. These measures address DGFT concerns raised in the show cause notice alleging contraventions of foreign trade rules.