Second hand equipment with EPCG Licence

[Udaya Kumar]

Dear Sir,

We would like to import second-hand equipment thro' EPCG Licence with 0% duty.  

(1)  Please inform the procedure with required documents from the LOAD PORT and  (2) at CHENNAI PORT.

(3)  Any prior approval required before Import, from whom..?   

(4)  How to apply/indicate in the EPCG thro' online.  

(5)  When we can apply for the Chartered Engineer Certificate.... during EPCG application... or.... after arrival. 

(6)  Is it necessary to get the CEC in the supplier's proforma invoice..? from whom.....Indian CE / Foreign CE.

(7)  Last date for applying the EPCG Licence with 0% duty....

Plz guide me

Uday 

[shubha harish]

Dear Mr. Udaya Kumar,

Since we have experience importing used machines under Annual EPCG authorization with 3% duty, replying to your query as below:

1. Please check whether your finished product is eligible under EPCG with 0% duty or else you can apply with 3% duty. 
2. Get the quotation from the supplier and apply for the EPCG authorization on line.  If you want to import only particular machines, go for EPCG authorization.  If your organization wants to import many more machines either it is new or used, in the year, go for Annual EPCG authorization, where list of machine you need to import is not necessary.  This is based on total CIF value and Duty saved amount.  Make sure, you specify the correct receiving port, while making online application.
3. Hope you are aware of all other formalities in applying and getting the license from DGFT.  On receipt of the EPCG authorization, you need to register at port
4. As soon the machines are shipped from the supplier, take the copies of invoice, AWB/BL, Justification for import of used machines and get the same attested by the local CE at your place along with Appx 32A.  You also need to get one certificate from supplier mentioning the machine number, year of manufacturer, original value etc.,
5. On arrival of the machines, handover these documents to your clearing agent along with EPCG authorization for clearance.
6. Since you are importing used machines, on filing of BE, Customs will nominated the CE, who will verify the documents submitted by you and also the machine and will do the valuation based the details you provided. 
7. Payment of Duty 3% (3.09%) is based on Valuation report submitted by the Customs nominated CE.
8. You have to send copy of BE, valuation report and documents you got attested by your local CE for clearance to your DGFT (JDGFT) office within a month of import.
9. Also you have to submit installation certificate from your Central Excise authorities if registered with Central Excise or a certificate from local CE confirming the installation of machines.

Thanks and regards,

Shubha

[Udaya Kumar]

Thanks very much Mr. Shubha

[Guest]

Dear Ms.Subha,

Greetings and Good Morning. 

I would like to know, whether we can import Second Hand Capital Goods under EPCG(0 percent or 3 percent ) in today's date. Pls advice.....

Regards,

Amit Vichare

[shubha harish]

Dear Amit,

As on date, we are not allowed to import Second Hand CG under EPCG authorizations.  Zero Duty EPCG authorizations are issued only for import of New CGs.

Thanks and regards,

Shubha

[Guest]

Dear Subha,

Thanks for the reply.

REgards,

Amit Vichare

[Guest]

Dear Ms.Shubha,

We like to know if still the restriction for Import of OLD Second hand machines under EPCG scheme is in force.

(or) Inform us if there is any other scheme for importing Old machines paying lesser duty.

Best rgrds,

Rajesh

[Mahir S]

Sir,

As on date, we are not allowed to import Second Hand CG under EPCG authorizations.

Zero Duty EPCG authorizations are issued only for import of New CGs.

As per para 6.02 of FTP; second hand CG, without age limit, may be imported duty free by EOU, STP, EHTP, STP and BTP subject to specify condition as mentioned therein.

However, import of second hand CG is not possible against EPCG.

[Guest]

Dear Mahir S

Thanks for your quick reply. Can we import second hand machine using DFIA scheme ? What are the procedures.?

Our factory is new factory yet to commence production. What r procedures to get EOU license.

If we get EOU license and i import second hand machine saving duty of 4lakhs, then what Export obligations should be fullfilled by us to continue under EOU scheme ?

Thanking you,

Rajesh.

[Mahir S]

Sir,

Under the DFIA Scheme, assistance is provided by Government to help exporters in importing raw materials. Hence, it does not allow import of second hand machinery.

Recently, the said scheme has been withdrawn by the Government.

[Mahir S]

An EOU can procure duty free second hand machinery without any time limit under para 6.2 of FTP 2015-2020 and under custom notification no. 52/2003. You need to take procurement certificate from your Range Office. This certificate will be submitted at the time of assessment of bill of entry. you are also required to register yourself for duty free import. at the time of import you are supposed to submit Invoice, Packing List, Bill of lading, Procurement Certificate, Test Certificate if required to determine heading and copy of contract.

Also refer para 2.31 (Second Hand Goods) under the Foreign Trade Policy (2015-2020).

[Mahir S]

For Procedure regarding EOU License, please refer Chapter 06 of the Foreign Trade Hand Book of Procedure 2015-2020 (From 1-4-2015 to 31-3-2020)

AI Summary

Import of Second Hand Capital Goods prohibited under EPCG; consider EOU duty free procurement or other FTP provisions instead. Import of second hand capital goods under the EPCG scheme is not permitted for zero duty authorizations; zero duty applies only to new capital goods. Previously, procedural practice required supplier quotation, online EPCG application (specific or annual), port registration, pre shipment documents attested by a local Chartered Engineer with Appendix 32A, and a supplier certificate identifying machine details. Customs would nominate a Chartered Engineer to verify the machine and issue a valuation report forming the basis for duty payment. Post import, bill of entry, valuation report and attested documents must be submitted to DGFT and installation certificates produced as required.