mpact on Duty Drawback / RoDTEP / IGST refund when export proceeds first credit to overseas FCY account

[Abhijeet Mane]

RBI (14 Jan 2025) now permits exporters to open/hold a Foreign Currency Account (FCY) with a bank outside India. Our plan is to receive export proceeds in an overseas FCY account (Singapore branch of the same AD bank) and either use the funds for import payments or repatriate them to India (EEFC/INR account) by the end of the next month per RBI timelines. Queries:-

1) Will receiving export proceeds in the overseas FCY account (with timely repatriation per FEMA/RBI) have any adverse impact on Duty Drawback, RoDTEP, or IGST refund? Is it mandatory for export proceeds to be credited directly into an Indian bank account for these benefits?

2) Since the Shipping Bill carries the AD code and an Indian bank account number, does initial credit of proceeds to an overseas FCY account (of the same AD bank) create any procedural hurdles for Customs/EDPMS closure or for credit of drawback/RoDTEP? What practical steps/documentation (e.g., e-BRC/EDPMS mapping) should be followed to avoid issues?

[Sadanand Bulbule]

In my considered opinion, credits into an Indian Bank Account is not mandatory for these benefits.

[Shilpi Jain]

Receipt in foreign account should not affect any entitlements.

Now there is a requirement of mentioning in the eBRC the invoice details. One the BRC is recieved it can be shared to the AD Bank to close out the EDPMS entries.

Also, now for entries upto Rs. 10 lakhs, the entries in EDPMS and IDPMS can be closed by a declaration from the exporter which can be also be done on a quarterly basis.

AI Summary

Receipt of export proceeds in overseas FCY account does not prevent Duty Drawback, RoDTEP, or IGST refund entitlements. Receiving export proceeds in an overseas FCY account does not bar entitlement to Duty Drawback, RoDTEP, or IGST refund; credit to an Indian bank account is not mandatory. Exporters must record invoice details in the eBRC, share the BRC with the AD bank to close EDPMS entries, and may use quarterly exporter declarations to close EDPMS/IDPMS entries up to Rs. 10 lakhs.