Capital item in Indian currency or U$

[Narasimha Subramanian]

One of our customers want to procure a capital item under EPCG scheme. We are importing this item from our Principals in US and selling to this customer as High Sea Sales. Can we sell to him in Indian Rupees or is it mandatory that the transaction should be in US$? Please clarify

[Surender Gupta]

There is no condition that the proceeds against High Sea sale must be paid in foreign exchange to avail the exemption under EPCG scheme. Your customer is still eligible for exemption.

[Jayasankar V]

You can sell the Capital goods sourced from your US based Principal, on high sea sales basis to your Customer holding EPCG Licence and you can charge / bill him in Indian Rupees for the cost of Capital goods adding your margin of Profit, which will be the basis for assessment of import duty from the EPCG Licence holder. SHRI JAYASANKAR. V. [email protected]

AI Summary

EPCG scheme: high sea sale proceeds need not be in foreign exchange; billing in Indian rupees permitted. There is no requirement that consideration for a high-sea sale under the EPCG scheme be paid in foreign exchange; the intermediary may invoice and receive payment in Indian rupees and the rupee invoice plus any margin will form the assessable value for import duty when the EPCG licence holder imports the capital goods.