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TMI BlogEXPORT PROMOTION CAPITAL GOODS (EPCG) SCHEMEX X X X Extracts X X X X X X X X Extracts X X X X ..... including refurbished/reconditioned spares), tools, jigs, fixtures, dies and moulds. (e) Second hand capital goods shall not be permitted to be imported under EPCG Scheme. (f) Import of Restricted items of imports mentioned under ITC (HS) shall only be allowed under EPCG Scheme after approval from EFC at Headquarters. 6[(g) Authorization under EPCG Scheme shall not be issued for import of any Capital Goods (including Captive plants and Power Generator Sets of any kind) for i. Export of electrical energy (power) ii. Supply of electrical energy (power) under deemed exports iii. Use of power (energy) in their own unit, and iv. Supply/export of electricity transmission services.] 5.2A (a) Spares (including refurbished/reconditioned spares), moulds, dies, jigs, fixtures, tools, and refractory for initial lining; for existing plant and machinery (imported earlier, under EPCG or otherwise), shall be allowed to be imported under the EPCG scheme subject to an export obligation equivalent to 50% of the export obligation prescribed in para 5.1 above (for import of capital goods), to be fulfilled in 6 years, reckoned from Authorization issue date. This would however be subject to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the EPCG Authorization details of the CSP in the respective Shipping bills and (ii) concerned RA must be informed about the details of the Users prior to such export; (ii) Such exports will not count towards fulfilment of other specific export obligations; and (iii) Bank Guarantee (BG) shall be equivalent to the duty saved. BG can be given by CSP or by any one of the users or a combination thereof, at the option of the CSP. 5.4 AU Condition under EPCG Import of capital goods shall be subject to Actual User condition till export obligation is completed. 5.5 Export Obligation (EO) Following conditions shall apply to the fulfilment of the EO:- (a) EO shall be fulfilled by export of goods manufactured / services rendered by the applicant. (b) EO under the scheme shall be, over and above, the average level of exports achieved by the applicant in the preceding three licensing years for the same and similar products within the overall EO period including extended period, if any; except for categories mentioned in paragraph 5.7.6 of HBP Vol. I. Such average would be the arithmetic mean of export performance in the preceding three years for the same and similar products provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PCG Authorization may source capital goods from a domestic manufacturer. Such domestic manufacturer shall be eligible for deemed export benefit under paragraph 8.3 of FTP. Such domestic sourcing shall also be permitted from EOUs and these supplies shall be counted for purpose of fulfilment of positive NFE by said EOU as provided in Para 6.9 (a) of FTP. 5.7 Fixation of Export Obligation (EO) In case of direct imports, EO shall be reckoned with reference to actual duty saved amount. In case of domestic sourcing, EO shall be reckoned with reference to notional Customs duties saved on FOR value. 5.8 Technological Upgradation of existing EPCG machinery EPCG Authorization holders can opt for 'Technological Upgradation' of existing capital goods imported under EPCG Authorization(s). Conditions governing are as under: (a) Minimum time period for applying for 'Technological Upgradation' is 4 years from earlier EPCG Authorization issue-date. (b) Minimum exports made must be 50% of total export obligation imposed on earlier EPCG Authorization(s). (c) EO would be re-fixed such that (i) total EO shall be sum total of 6 times of duty saved of earlier EPCG and the new one, and (ii) EOP ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stipulated in Para 5.5, if any. --------------------------- Notes:- 1 Substituted vide Notification No.8 (RE-2012) /2009-2014, Dated 26/07/2012, before it was read as:- "(a) Spares (including refurbished/reconditioned spares), moulds, dies, jigs, fixtures, tools, refractory for initial lining and catalyst for initial charge as well as catalyst for subsequent charge upto a maximum 2 times during Export Obligation Period (EOP); for existing plant and machinery (imported earlier, under EPCG or otherwise), shall be allowed to be imported under the EPCG scheme subject to an export obligation equivalent to 50% of the export obligation prescribed in para 5.1 and 5.2 above (for import of capital goods), to be fulfilled in 8 years (6 years for zero duty EPCG), reckoned from Authorization issue date. This would however be subject to the condition that the c.i.f. value of import of the above spares etc. will be limited to 10% of the value of plant and machinery imported under the EPCG scheme. In case of plant and machinery not imported under the EPCG scheme, c.i.f. value of import of the spares etc. will be limited to 10% of the book value of the plant and machinery." 2 Substituted vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... availing any benefits under Technology Upgradation Fund Scheme (TUFS) administered by Ministry of Textiles, Government of India. (e) Zero Duty Scheme shall also be available to such exporters who may have obtained benefit under TUFS (i) but the exact line of business in TUFS (say cotton yarn) is different from the line of business under EPCG (say machinery for blast furnace); or (ii) if the exporter refunds such benefits availed under TUFS with applicable interest, before availing EPCG. (f) Zero duty EPCG scheme shall not be available to exporters, who avail in that year, the benefit of Status Holder Incentive Scheme under Paragraph 3.16 of FTP. In case they have already availed SHIS benefit they would be eligible for Zero Duty Scheme if they surrender or refund SHIS on similar lines as given at (e) (ii) above. (g) All other provisions pertaining to concessional 3% duty EPCG scheme under this Chapter, to the extent they are not inconsistent with the above provisions of zero duty EPCG scheme, shall be applicable to the zero duty EPCG scheme also. (h) The zero duty EPCG scheme shall be in operation till 31.3.2013, unless decided otherwise. 5.2 Concessional 3% Duty EPCG Schem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C (HS) shall only be allowed under EPCG Scheme after approval from EFC at Headquarters. 5.2 A 1[Spares (including refurbished/reconditioned spares), moulds, dies, jigs, fixtures, tools, and refractory for initial lining; for existing plant and machinery (imported earlier, under EPCG or otherwise), shall be allowed to be imported under the EPCG scheme subject to an export obligation equivalent to 50% of the export obligation prescribed in para 5.1 and 5.2 above (for import of capital goods), to be fulfilled in 8 years (6 years for zero duty EPCG), reckoned from Authorization issue date. This would however be subject to the condition that the c.i.f. value of import of the above spares etc. will be limited to 10% of the value of plant and machinery imported under the EPCG scheme. In case of plant and machinery not imported under the EPCG scheme, c.i.f. value of import of the spares etc. will be limited to 10% of the book value of the plant and machinery.] (b) Provision of this para will not be applicable for import of spares in respect of capital goods sourced indigenously. 5.2B EPCG for Projects (a) Import of capital goods under Scheme for Project Imports notified by the Centra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Obligation (EO) Following conditions shall apply to the fulfillment of the EO:- (a) EO shall be fulfilled by export of goods manufactured / services rendered by the applicant. (b) EO under the scheme shall be, over and above, the average level of exports achieved by him in the preceding three licensing years for the same and similar products within the overall EO period including extended period, if any; except for categories mentioned in paragraph 5.7.6 of HBP Vol. I. Such average would be the arithmetic mean of export performance in the last three years for the same and similar products provided that Premier Trading House (PTH) shall have option of fixing average level of exports based on arithmetic mean of export performance in the last five years instead of three years. (c) Upto 50% EO may also be fulfilled by exports of other good(s) manufactured or service(s) provided by the same firm / company, or group company / managed hotel, which has the EPCG authorization. However, EPCG authorizations issued prior to 01.04.2008 will be governed by earlier policy provisions. (d) However, in such cases, additional export obligation imposed shall be over and above average exports achi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oms duties saved on FOR value. 5.8 Technological Upgradation of existing EPCG machinery EPCG Authorization holders can opt for 'Technological Upgradation' of existing capital good imported under EPCG Authorization(s). Conditions governing are as under: (a) Minimum time period for applying for 'Technological Upgradation' is 5 years from earlier EPCG Authorization issue-date. (b) Minimum exports made must be 40% of total export obligation imposed on earlier EPCG Authorization(s). (c) EO would be re-fixed such that (i) total EO shall be sum total of 6 times of duty saved of earlier EPCG and the new one, and (ii) EOP is 8 years from EPCG authorization issue-date under this Para. (d) Facility for technological up-gradation shall be available only once and the minimum imports to be made shall be at least 10% of the existing investment in plant and machinery by applicant. (e) Capital Goods to be imported must be new and technologically superior to earlier CG (to be certified by Chartered Engineer). 5.9 Incentive for Fast Track Companies To incentivize fast track companies with a view to accelerate exports, in cases where Authorization holder has fulfilled 75% or more of speci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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