Reward /Incentive Schemes - CBEC's Customs Manual 2023 - Customs

2. Reward /Incentive Schemes: 2.1 The provisions of Reward/Incentive Schemes of FTP 2009-14 (effective for exports till 31.03.2015) viz. Served From India Scheme (SFIS), Vishesh Krishi and Gram Udyog Yojana (VKGUY), Agri. Infrastructure Incentive Scrip (AIIS), Focus Market Scheme (FMS), Focus Product Scheme (FPS) and Status Holders Incentive Scrip (SHIS) Schemes have been dealt at paras 2 to 7 of Chapter 23 of the Customs Manual 2014. 2.2 Under the FTP 2015-20, (a) Merchandise Exports from India (MEIS) Scheme rewards export of notified goods listed in Appendix 3B of Handbook of Procedures generally @ 2% or 3% or 5% or 7% or 10% of certain FOB value of exports. It includes reward on export via foreign post offices or international courier terminals of specified items that are transacted using e-commerce platforms, subject to value limit of Rs. 5 lakh per consignment. In order to claim reward under MEIS, it is mandatory that exporter declares intent to claim reward at the time of export on shipping bills / bills of export that are filed on or after 1.6.2015. (b) Service Exports from India (SEIS) Scheme incentivizes export of notified services listed in Appendix 3D of Handbook of Procedures by service provider located in India who have specified minimum net free foreign exchange earnings in preceding financial year. Only services rendered in the manner as per Para 9.51(i) and Para 9.51(ii) of the Foreign Trade Policy (FTP) 2015-20 are eligible. The entitlement is either 3% or 5% or 7% of net foreign exchange earned. (c) Under these two schemes, based on FOB value of exports/net foreign exchange earnings, DGFT issues duty credit scrips viz. MEIS SEIS scrips. Both, MEIS and SEIS scrips are freely transferable and can be used for payment of Basic Customs Duty (BCD) on import of any item except those listed in Appendix 3A of Foreign Trade Procedures, or for domestic procurement of items that continue to be subject to Central Excise duties in GST regime. Basic Customs duty paid through debit under these scrips is allowed to be adjusted as Duty Drawback. Additional Customs duty/ post GST remnant excise duty paid through debit in these scrips is also allowed to be adjusted as CENVAT Credit or Duty Drawback. [Refer Notifications Nos. 24 and 25 /2015-Customs, Nos.20 and 21 /2015-C.E., all dated 8-4-2015] (d) Duty Credit Scrips issued under FTP 2015-20 can also be utilized / debited for payment of Customs duties in case of EO defaults for authorizations issued under Chapter 4 and 5 of FTP 2015-20.However, Duty Credit Scrips cannot be used to discharge penalty or interest which are required to be deposited in cash. [Refer Circular No. 11/2015-Customs dated 01.04.2015] (e) Clearance of goods from Customs Bonded warehouses using MEIS and SEIS duty credit scrips for duty payment is allowed as per the same procedure as is prescribed for DEPB scrips. [Refer Para 3.11 of Foreign Trade Procedure 2015-20 and Circular No. 68/2000 dated 18.8.2000 and 72/2003-Cus dated 11.8.2003]. 2.3 Verification related to duty credit scrips: Where export of goods under specific shipping bills/bills of export (not filed electronically in Customs EDI) shown in annexure/condition sheet of the reward duty credit scrip is involved, the backing shipping bills need to be verified for genuineness. However, if the shipping bills were filed electronically in Customs EDI but scrip was not received simultaneously online through electronic transmission from DGFT, such verification of genuineness of shipping bills shall be restricted to not more than 5% randomly selected scrips for which EDI shipping bill details (irrespective of port of export) shall be viewed in house using the role enq_cntry in ICES v. 1.5, without seeking documents from exporter. The Custom Houses need not verify genuineness of shipping bills when the reward scrip has been simultaneously received online through electronic transmission from DGFT. Customs can also carry out complete verification of scrip only where specific intelligence suggests misuse or requirement of an investigation. [Refer Circulars No. 5/2010-Cus.dated 16-3-2010, No.17/2012-Cus., dated 5-7-2012, No. 14/2015-Cus. dated 20-4-2015, 12/2016-Cus dated 28-3-2016 and Instruction No.609/119/2010-DBK., dated 18-1-2011]