DTA sale by EOU - Payment of duty

[VENKATASUBRAMANIAN VENKATACHALAM]

CAN ANY BODY HELP ME CLARIFY THE FOLLOWING POINTS? 1. DTA SALE BY EOU - IF SALES IS MADE TO A CUSTOMER WHO IS ENJOYING 100% DUTY EXEMPTION AS PER CLAUSE 6.9 OF FTP WHETHER THIS SALE IS CONSIDERED AS DTA SALES/DEEMED EXPORTS, WHETHER 50% DTA ENTITLEMENT INCLUDES THIS SALE ALSO? 2. IN THE ABOVE CONTEXT WHETHER ANY DUTY IS PAYABLE BY THE EOU UNITS SINCE THE MATERIAL IMPORTED/LOCALLY PROCURED IS WITHOUT PAYMENT OF DUTY? PLEASE ENLIGHTNE ME QUOTING RELEVANT PROVISIONS OF THE LAW/POLICY. VENKAT, CHENNAI

[RadheyShyam Mangal]

As per para 6.9(1), an EOU can supply goods to holder of Advance Authorisation, DFIA,EPCG Holder . Such supply will be counted towards calculation of NFE and hence deemed export. Duty payable will be nil or as per extant exim scheme of Advance Authorisation, Dfia, EPCG. The 50% entitlement does not include such sale .

AI Summary

Deemed export treatment applies when EOUs supply Advance Authorisation, DFIA or EPCG holders, influencing duty and DTA entitlement. Supply by an EOU to holders of Advance Authorisation, DFIA or EPCG is treated as a deemed export counted for NFE calculation; duty is nil or as per the applicable exim authorisation scheme, and such deemed export supplies are excluded from the 50% DTA sale entitlement.