EXPORTS
FRAMEWORK
POLICY,SCHEMES
AND
PROCEDURES
9th November 2010
DG&CEO
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Taxes and Duties
 Central: Basic customs duty, additional Customs
duty, special additional duty, education
surcharge, service tax ,CST.
 State: VAT, Electricity duty, Octroi, Mandi Tax,
Turnover tax, Purchase tax, Luxary Tax,
Entertainment Tax, Entry Tax in lieu of Octroi.
 Export Duty.
 GST: CGST,SGST,IGST.
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Service Tax Refund
 18 services eligible for refund.
 Details available at www.cbec.gov.in
 Refund only for service tax paid on
specified services
 Provided no CENVAT benefit has been
availed
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Procedure
 Manufacturer exporter to excise having
claim over factory
 Others to excise having jurisdiction over
regd./head office
 Before that STC is alloted to applicant
 Claim to be filed within 1 year from export
from LEO
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Procedure(Contd.)
 No claim less than Rs 500
 If claim is upto 0.25% of fob ,document or
application to be self certified
 If claim is more than 0.25% of fob
,document or application to be CA
certified
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Zero Rebating of Exports
 No tax or duty on exports.( Export tariff
aberration)
 No Excise duty or VAT on final product.
 Rebating of service tax on output services
 Other Central taxes refund through duty
refund/exemption schemes.
 State Tax: Except VAT ,rest are not
refunded.
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IEC
Permanent Code issued by DGFT
 Application Form
 Fee of Rs 250
 Copy of PAN
 Copy of bankers Certificate
 Declarations
 Exempted Categories
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BIN
Software generated at Customs
 Transmission of IEC
 15 digit
 PAN FT 001 and so on
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RCMC
Issued by Councils/Boards/Authorities
 Form
 IEC
 Membership Fee
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Shipping Bill
 Shipping bill for export of goods under
claim for duty drawback/DEPB etc.
 Shipping Bill for export of dutiable goods.
 Shipping Bill for export of duty free
goods.(Free or White )
 Shipping bill for export of duty free goods
ex-bond i.e. from bonded warehouse
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Bank Certificate of Exports &
Realisation
 Exports documents to be presented to bank
within 21 days
 Advance payment and status holders
exempted
 After negotiation Bank Certificate of
exports and subsequent to realisation
banks issue BRC
 Required for claiming various benefits
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Examination by Customs
 Invoice
 Packing list
 ARE 1
Rule 18
Rule 19
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ARE 1





Excise document for export clearance prepared
in quintuplicate . Bears running serial number
beginning from the first day of the financial year.
Original
White
Duplicate
Buff
Triplicate
Pink
Quadruplicate
Green
Quintuplicate
Blue
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MATE RECEIPT
 An acknowledgement of cargo receipt
signed by a mate of the vessel.
 The possessor of the mate's receipt is
entitled to the bill of lading, in exchange
for that receipt.
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BILL OF LADING
 A document issued by a carrier to a
shipper, acknowledging that
specified goods have been received on
board for delivery to the consignee
 Evidence of a valid chartering contract
and may incorporate the full terms of the
contract between the consignor and carrier.
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BOL
 Receipt signed by the carrier confirming
goods matching the contract description
have been received in good condition
 A document of transfer, being freely
transferable but not negotiable instrument
 It governs all the legal aspects of physical
carriage and like a cheque or other
negotiable instrument may be endorsed
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Straight /Order BOL
 A straight bill of lading is a nonnegotiable document, made out to a
specifically named consignee
 An Order bill of lading is a document that
is made out to the order of the foreign
importer / its bank/ export firm/ its bank,
or another designated party.
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FT(D&R) Act
 FT(D&R) Act repealed Import and Export
(Control) Act, 1947.
 FT(D&R )Act, 1992 provide for
development and regulation of foreign
trade by facilitating imports and
augmenting exports .
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FOREIGN TRADE POLICY
Section 5 of Foreign Trade
(Development and Regulation) Act,
1992 empowers the Central
Government to notify the Exim (FT)
Policy.
Para 2.4 of Foreign Trade Policy
empowers DGFT to notify procedures
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FOREIGN TRADE POLICY
2009-14
Basic objective
 To double our global share of merchandise
and services exports by 2014.
 Provide stability to Policy with continuation
of Schemes.
 Diversify our product and market base.
 Reduce transaction time and cost
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Imports/Exports
 All Imports/Exports are free except for the
items shown as Prohibited/Restricted/State
trading enterprises.
 Import/Export permitted from/to any
destination .Import/export of arms and
related material from/to Iraq and North
Korea prohibited
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Imports/Exports (Contd)
 Prohibited goods:- Not allowed except in
exceptional cases with approval of Central
Government.
 Restricted goods: May be allowed under a
licence or through a public notice.
 STE goods:- May be imported/exported by
STE(s) or with a licence from DGFT.
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Pre-requisite of Import/Export
 Importer-Exporter Code (IEC):- Mandatory
except for exempted categories in paragraph
2.8 of Handbook of Procedure
Documentation:- Application form with fee .
Copy of PAN.
Copy of banker’s Certificate
Declaration regarding NRI interest
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EXPORT PROMOTION
SCHEMES
 Export Promotion Capital Goods Scheme.
 Duty Exemption Scheme.
 VKGUY
 Focus Product, Focus Market and Market
linked Focus Product Scheme
 EOU/SEZ Scheme
 Status holder Scheme.
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Export Promotion Capital
Goods Scheme
 Import of capital goods at a concessional
basic customs duty of 0% for selected
sectors and 3% allowed(for all sector) for
export purposes. .
 Spare ,Jigs ,fixture ,dies and moulds also
allowed.
 Second hand CG without any age
restriction permitted under the Scheme.
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Conditions of Exports
 Export to be effected equivalent to 8 times (5
times for agro, cottage and tiny sector and 6 times
for SSI units)of the duty saved on capital goods .
 Exports to be completed in 8 years/12 years time.
 For Zero duty,6 times in six years.
 12 years for duty saved> Rs 100 Cr , and units in
agro, cottage and tiny sector.
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Conditions of Exports (Contd)
 Export of goods capable of being
manufactured by use of capital goods.
 EO could be discharged by export of
goods produced in different manufacturing
unit of the company.
 Facility to meet 50% of EO by exports of
additional items from the same
company/group companies permitted.
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Duty Exemption/Remission
Scheme
 Advance Authorisation.
 Annual Advance Authorisation
 Duty Free Import Authorisation .
 Duty Entitlement Pass Book Scheme.
 Duty Drawback Scheme
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Advance Authorisation
 Duty Free import of inputs allowed for
exports.
 Minimum 15% value addition to be
achieved.
 Exports/Imports to be completed in 24
months.
 Bond / BG / LUT to be given to the
Custom Authorities.
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Advance Authorisation
 Advance License indicates description of
export items, quantity of export item, FOB
value of exports, description of import
items, quantity of import items and CIF
value of imports.
 Import of inputs exempted from Basic
Customs duty, Additional Customs duty
and Safeguard/Anti-dumping duty.
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Annual Advance
Authorisation
 Available only to status holders and
exporters with 2 years exports.
 Entitlement equivalent to 300% of the FOB
value or Rs 1 crore ,whichever more in
preceding year.
 Authorisation valid for 24 months imp/
exports.
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Annual Advance
Authorisation (Contd..)
 Licence only mentions the export product
group, CIF value and FOB value.
 Licence holder can export any product
falling under the product group including
items for which norms do not exist.
 Only one licence for one product group or
port of registration.
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Duty Free Import Authorisation
 New Scheme effective from 1st May,2006
 Exporter allowed to import inputs free of
Basic Customs and or Additional /SAD
duty.
 DFIA indicates names and quantity of the
raw-material to be allowed duty free.
 Minimum value addition of 20% required.
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Duty Free Import Authorisation
(Contd.)
 DFIA and/or material imported under it
transferable after completing EO.
 Scheme covers only products for which
Standard Input Output Norms exist.
 Additional Customs duty is refunded
through CENVAT or drawback in case of
transferabilty.
 CENVAT permitted under the scheme.
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Duty Entitlement Pass Book
Scheme
 Substitution Drawback Scheme under
ASCM
 Aims to neutralize incidence of customs
duty on import content of export product,
 Exporter entitled for credit at a prespecified rate of FOB value of exports.
 Rates dependent on SION, value addition
and Basic Customs duty.
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Duty Entitlement Pass Book
Scheme (Contd)
 Credit can be utilised for import of items
otherwise freely importable except capital
goods.
 For edible oil debit could be only upto
50% from DEPB.
 Basic Customs duty, Additional Customs
duty debitble from DEPB .
 Validity 24 months and upto the last day of
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the month.
Drawback Scheme
 All-Industry : for a product by all
companies /firms
 Brand Rate :Exclusive to a company/firm
for a product
AIDBK not available
Refunds less than 4/5th of duties
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Drawback Scheme(contd)
 New Drawback Schedule notified from
17th Sept 2010
 Most drawback rates are specific as against
ad-valorem
 Drawback Schedule covers now about
1400 products.
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VKGUY
 Objective to promote agriculture, forest produce
and their value added forms, Forest produce and
Gram Udyog Products
 Benefit of 5% transferrable duty free credit
entitlement for products given in App 37 A .
3%when exporter uses imported inputs under
Advance authorisation or claim DEPB/DBK of
over 1%.
 EOUs not availing 10 B benefits also eligible.
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Focus Market Scheme
 To offset high freight cost and other
externalities to select international market.
 Benefit of 3% transferrable duty free
credit entitlement for countries given in
App 37 C.
 EOUs/STPs/EHTPs not availing 10 B
benefits also eligible.
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Focus Product Scheme
 To incentivise exports with high employment
intensity in rural and semi urban areas
 Benefit of 2% transferrable duty free credit
entitlement for products given in App 37 D .
 EOUs/STPs/EHTPs not availing 10 B benefits
also eligible.
 Special Focus Products under table 2 and 5 to be
given 5%
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Market Linked Focus Product
Scheme
 Benefit is given on a product country
matrix
 2% transferable duty free credit entitlement
for listed products to specified countries
 Exclusivity: Only one of the benefit of
FMS,FPS,MLFPS or VKGUY can be
claimed.
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Served From India Scheme
 Accelerate growth of services exports and
create Served from India brand
 All service providers with foreign
exchange earning of Rs 10 lakh and more
eligible .Individual with Rs 5 lakh forex
earnings also eligible.
 Entitled for 10 % duty free credit of current
year forex earnings.
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Served From India
Scheme(Contd.)
 Duty free Credit to be used for imports of
capital goods office equipments, spares,
professional equipments, office furniture
consumables
 Domestic procurement permitted
 Not transferrable (except within Group Company
and Managed Hotels)
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Export Oriented Units
 Introduced in early 1981 (Prakash Tandon
Committee) to offer duty and control free
regime of export production without
location binding.
 Units for manufacturing and services (no
trading permitted)
 Only projects having minimum investment
of Rs 1 Cr in plant & machinery except
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specified sectors. DG&CEO
Export Oriented Units (Contd)
 Facilities:
Import/ Export all goods except prohibited
Exemption from IT under section 10B
Exemption from industrial licensing for SSI
items
100% FDI permitted through Automatic
route as applicable to SEZ.
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Export Oriented Units (Contd)
 100% of export earnings in EEFC
 Export remittance within 12 months.
 OBU to extend the credit on same terms as
extended to units in SEZ
 DTA sale up to 50% of FOB value of
exports
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Export Oriented Units (Contd)
 NFEP to be positive over 5 years.
 Supplies to these units deemed exports.
 Re-imbursement of CST on goods
manufactured.
 Remission of Service Tax
 Exemption from excise on domestic
procurement
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Special Economic Zones
 Scheme announced in March, 2000.
 Foreign territory for taxes and duties
 Goods from DTA to SEZ exports, reverse
process imports.
 Developers of SEZs eligible for tax/duty
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exemptions
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Special Economic Zones(Contd)
Facilities for developer:
IT exemption as per 80 IA of IT
Import/procurement of CG and inputs
without customs/excise duty
Exemption from CST
Exemption from Service Tax
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Special Economic Zones(Contd)
Facilities for units:
Import/ Export all goods except prohibited
Exemption from Income Tax
Exemption from industrial licensing for SSI
items
100% FDI permitted through Automatic
route .
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Special Economic Zones (Contd)
 NFEP to be positive over 5 years
 100% of export earnings in EEFC
 Export remittance without any time limit.
 OBU to extend the credit on international
benchmarks.
 DTA sale without any limit subject to
NFE positive on applicable duties.
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Special Economic Zones(Contd)
 No interference from the Custom
Authorities inside the zone
 Supplies to these units physical exports.
 Exemption of CST on goods
manufactured.
 Exemption of Service Tax
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STATUS SCHEME
Category Total exports
during current plus
1/2/3 years
EXPORT HOUSE
Rs 20 Cr
STAR EXPORT
HOUSE
Rs 100Cr
TRADING HOUSE
STAR TRADING
HOUSE
Rs 500 Cr
Rs 2500 Cr
PREMIER TRADING Rs
7,500Cr
DG&CEO
HOUSE
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Facilities To Status Holders
 Automatic issuance of Authorisation
 100% in EEFC
 Direct negotiation of documents
 Fixation of Norms in 60 days
 Exemption from BG.
 Accelerated Customs clearance under ACP
 Status Holder Incentive Scrip
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Status Holder Incentive Scrip
 Leather(excl finished),Textiles& Jute, Handicrafts
Engineering (except metals in primary or intermediate
forms, automobiles,two wheelers, nuclear reactors ,ship
boats and floating structures),Plastic and Basic
Chemicals(excl Pharma)
 Incentive@1% for exports in 2009-10 , 2010-11and
2011-12
 Actual User for imports of capital goods
 Beneficiary of TUF not eligible
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Status Holder Incentive Scrip
New Products

1 Chemical & Allied Products (other than Bulk minerals, Granite/Stones,Processed minerals, Cement, Clinkers
and asbestos)

(i) Rubber products, 4001 to 4010,4014 to 4017

(ii) Paints, Varnishes & Allied Products 3208, 3209,3210

(iii) Glass and glassware Chapter 70

(iv) Plywood and allied products Chapter 44

(v) Ceramics / refractories Chapter 69

(vi) Paper, Paper Boards & Paper products Chapter 48

(vii) Books, Publications & Printings Chapter 49

(viii) Animal By-products (Codes35030030, , 05069099, 05079010,05079020, 05079050, 23011010,
23011090, 96062910, and 96063010)

(ix) Ossein & GelatineCodes05061039 and 35030020

(x) Graphite Products (Codes 3801,85451100 and 85451900) &

Explosives (Codes 3601, 3602 and 3603)

(xi) Misc. Products (Codes 3201,32029010, 32030010, 3604, 3605, &38021000)
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Status Holder Incentive Scrip
New Products




Electronics Products
Sports Goods and Toys
Chapter 95and Codes420321,650610
Engineering products for the three groups indicated
below Chapter 72
(i) Iron and Steel
(ii) Pipes and tubes
(iii) Ferro Alloys
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THANK YOU ALL
DG&CEO
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