TaxTMI 
TaxTMI 
DUTY EXEMPTION & REMISSION SCHEMES
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....HORISATION SCHEME Advance Authorisation 4.1.3 An Advance Authorisation is issued to allow duty free import of inputs, which are physically incorporated in export product (making normal allowance for wastage). In addition, fuel, oil, energy, catalysts which are consumed / utilised to obtain export product, may also be allowed. DGFT, by means of Public Notice, may exclude any product(s) from purview of Advance Authorisation. Duty free import of mandatory spares upto 10% of CIF value of Authorisation which are required to be exported / supplied with resultant product are allowed under Advance Authorisation. Advance Authorisations are issued for inputs and export items given under SION. These can also be issued on the basis of Adhoc norms or self-declared norms as per para 4.7 of HBP v1. 1[Advance Authorisation can be issued either to a manufacturer exporter or a merchant exporter tied to supporting manufacturer(s). However, advance authorisation under paragraph 4.7A of HBP. v1 (for pharmaceutical products manufactured through Non-Infringing (NI) process) shall be issued to Manufacturer exporter only." Advance Authorisation shall be issued for: i) Physical exports (including expo....
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....d from 17.2.2009, till 30.09.2009 under Advance Authorization Scheme. Further the manufacturing wastes / scrap, as allowed, can be disposed off with the payment of applicable duty even before fulfilment of export obligation. 4.1.6 Advance Authorisation necessitates exports with a minimum value addition of 15%, except for items specified in Appendix 11B of HBP v1 and for items in Gems & Jewellery sector, for which value addition would be as per paragraph 4A.2.1 of HBP v.1. Exports to SEZ Units / supplies to Developers / Codevelopers, irrespective of currency of realization, would also be covered. For physical exports for which payments are not received in freely convertible currency, same shall be subject to value addition as specified in Appendix-11 of HBP v1. In case of Authorisation for import of Tea, minimum value addition under Advance Authorisation shall be 50%. Similarly, in case of spices {covered by Chapter 9 of ITC(HS)}, duty free import of spices shall be permitted only for value addition purposes like crushing / grinding / sterilization or for manufacture of oils and oleoresins and not for simple cleaning, grading, re-packing etc. 4.1.7 Advance Authorisation shall ....
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....o ARO or Invalidation letter. Transferee of DFIA shall also be eligible for ARO / Invalidation letter facility. Validity period of ARO shall be as prescribed in HBP v1. Back-to-Back Inland Letter of Credit 4.1.12 Holder of Advance Authorisation, Advance Authorisation for Annual Requirement and DFIA may, instead of applying for an ARO or Invalidation letter, avail of the facility of Back-to-Back Inland Letter of Credit in accordance with procedure specified in HBP v1. Prohibited Items 4.1.13 Prohibited items of imports mentioned in ITC(HS) shall not be imported under Advance Authorisation / DFIA. Further items reserved for imports by STEs cannot be imported against Advance Authorisation / DFIA. However those items can be procured from STEs against ARO or Invalidation letter. STEs are also allowed to sell goods on High Sea Sale basis to holders of Advance Authorisation / DFIA holder. In addition, STEs are permitted to issue "No Objection Certificate (NOC)" for import by advance Authorisation / DFIA holder. Authorisation Holder would be required to file Quarterly Returns of imports effected against such NOC to concerned STE and STE would submit half-yearly import figures of suc....
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.... v1. Items for which higher value addition is prescribed under Advance Authorisation Scheme shall be applicable. Export Obligation 4.2.5 Procedure and time period related to fulfillment of Export Obligation have been laid down in Chapter 4 of HBP v1. Transferability 4.2.6 Once export obligation has been fulfilled, request for transferability of Authorisation or inputs imported against it may be made before concerned RA. Once, transferability is endorsed, Authorisation holder may transfer DFIA or duty free inputs, except fuel and any other item(s) notified by DGFT. However, for fuel, import entitlement may be transferred only to companies which have been granted authorisation to market fuel by Ministry of Petroleum and Natural Gas. Once transferability is endorsed, imports / domestic procurement against authorisation or transfer of imported inputs / domestically procured inputs shall be subject to payment of applicable additional customs duty / excise duty. While endorsing transferability, authorisation would bear a note as to liability of such additional customs duty / excise duty. However, in case where CENVAT facility has not been availed, exemption from additional customs d....
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....all not be entitled for DEPB credit except for the exports effected under transitional facility, wherever allowed, in terms of paragraph 1.5 of FTP. 4.3.2 DEPB holder shall have option to pay additional customs duty in cash as well. Validity 4.3.3 Validity period of DEPB for import shall be as prescribed in HBP v1. Transferability 4.3.4 DEPB and / or items imported against it are freely transferable. Transfer of DEPB shall however be for import at specified port, which shall be the port from where exports have been made. Imports from a port other than the port of export shall be allowed under TRA facility as per terms and conditions of DOR notification. Applicability of Drawback 4.3.5 Additional customs duty / Excise Duty and Special Additional Duty paid in cash or through debit under DEPB may also be adjusted as CENVAT Credit or Duty Drawback as per DoR rules. GEMS AND JEWELLERY Scheme for Gems and Jewellery 4A Exporters of Gems and Jewellery can import / procure duty free inputs for manufacturing. Replenishment Authorisation 4A.1 Exporters may obtain Replenishment (REP) Authorisations from RA in accordance with procedure specified in HBP v1. 4A.1.1 Replenishment auth....
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....d India Limited (DIL), Gems & Jewellery Export Promotion Council (G&J EPC)), Star Trading House (only for Gems & Jewellery sector) and Premier Trading House under Paragraph 3.10.2 of FTP and any other agency authorised by RBI. Exporters (except EOUs and units in SEZ) may obtain gold / silver / platinum from nominated agency(s). Procedure for import of precious metal by these agencies (other than those authorized by RBI and the Gems & Jewellery units operating under EOU and SEZ schemes) and the monitoring mechanism thereof shall be as per the provisions laid down in HBP v1 in this regard. A bank authorised by RBI is allowed export of gold scrap for refining and import standard gold bars as per RBI guidelines. Items of Export 4A.5 Following items, if exported, would be eligible for facilities: (a) Gold jewellery, including partly processed jewellery and articles including medallions and coins (excluding legal tender coins), whether plain or studded, containing gold of 8 carats and above; (b) Silver jewellery including partly processed jewellery, silverware, silver strips and articles including medallions and coins (excluding legal tender coins and any engineering goods) contain....
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....ts and above; (b) Silver of fineness not less than 0.995 and mountings, sockets, frames and findings containing more than 50% silver by weight; (c) Platinum of fineness not less than 0.900 and mountings, sockets, frames and findings containing more than 50% platinum by weight. 4A.11 Such authorisations shall carry an export obligation to be fulfilled as per procedure specified in paragraph 4A of HBP v1. Value addition shall be as per paragraph 4A.2.1 of HBP v.1. Advance Authorisation holder may obtain gold / silver / platinum from nominated agencies in lieu of direct import. Gem Replenishment Authorisation 4A.12 Gem Replenishment (Gem & Jewellery REP) Authorisation may be issued as given in paragraph 4A.8, 4A.9 and 4A.10 above. In case of plain or studded gold / silver / platinum jewellery and articles, value of such Authorisations shall be determined with reference to realisation in excess of prescribed minimum VA. Such Gem REP Authorisations shall be freely transferable. Gem REP Rate and Item 4A.13 Replenishment Rate and item of import will be as prescribed in Appendix 12B of HBP v1. Export Promotion Tours/ Export of Branded Jewellery 4A.14 Nominated agencies and their ....