Press Information Bureau

Government of India

Ministry of Commerce & Industry

30-April-2012 17:11 IST

Incentives for Exporters

The Government reviews performance of export sectors at regular intervals and takes remedial measures for providing incentives whenever needed to boost exports. Incentives are provided in the form of duty credit scrip under the Foreign Trade Policy schemes such as Focus Product Scheme, Focus Market Scheme and Vishesh Krishi & Gram Udyog Yojana.

Like in any other scheme, the possibility of misuse of the export promotion measures cannot be completely ruled out. The possible misuses could be in the form of forged documents, giving mis-declaration, diversion of materials to the domestic market, under invoicing /over invoicing of import and export. In course of monitoring of export obligations as also on the basis of information received from the Directorate of Revenue Intelligence, Customs and other agencies regarding irregularities, penal actions are taken against such firms under the Foreign Trade (Development & Regulation) Act and Rules framed therein. Action taken includes suspension/cancellation of the IEC number of the units, imposing fiscal penalty with penal interest in addition to action taken under the Customs Act.

This information was given by Shri Anand Sharma , Union Minister for Commerce, Industry and Textiles in written reply to a question in Lok Sabha today.

DS/GK

Export incentive misuse triggers penal actions including IEC suspension and fiscal penalties under foreign trade law. Where misuse of export incentive schemes is detected - including forged documents, mis declaration, diversion to the domestic market, and incorrect invoicing - penal measures are imposed under the Foreign Trade (Development & Regulation) Act and rules, with enforcement by revenue intelligence and customs that may suspend or cancel the IEC and impose fiscal penalties with penal interest alongside action under the Customs Act.