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?

AI Summary

Export proceeds credited to overseas FCY account: ensure timely FEMA repatriation and documentation to protect drawback, RoDTEP, IGST refunds RBI permission to hold export proceeds in an overseas foreign currency account raises questions on entitlement to duty drawback, RoDTEP and IGST refund. Customs benefits depend on compliance with FEMA repatriation timelines and documentary linkage between shipping bill/AD code and payment evidence; failure to repatriate or to furnish mapped e-BRC/EDPMS records may impede credit of drawback, RoDTEP or IGST refund. Practical measures include timely repatriation per RBI/FEMA, obtaining and mapping e-BRCs to EDPMS, ensuring AD bank reconciliation and maintaining export payment documentary trail to enable Customs/EDPMS closure and benefit credit.