Procedure - Duty free capital items

[Guest]

B-17 bonds are executed by 100% EOU units.The duty forgone in case of raw materials(imported/excise duty free) is debited from the bond & it is credited when the materials are consumed.What are the procedures to be followed in case of duty free Capital items.

[Guest]

Bond in respect of capital goods shall not be discharged on arrival of the capital goods within the unit so long as the capital goods are in the unit.

[RadheyShyam Mangal]

in case of duty free Capital items duty at the rate of 25% of duty foregone is debited in B-17 Bond. the credit is allowed only at the time debonding of captial goods.

AI Summary

Duty treatment for capital goods: bond liability persists while goods remain in unit, credit permitted only on debonding. Capital goods imported under a B-17 bond for 100% export-oriented units remain subject to the bond and the bond is not discharged while those goods are in the unit; duty forgone on capital items is debited to the bond and credit for that duty is permitted only at the time of debonding.