Cases under investigation for fraud and misdeclaration of capital goods will be excluded from the coverage of the amnesty scheme announced under the new foreign trade policy, according to the commerce ministry.
The government announced the new FTP on March 31. It included an amnesty scheme for exporters for a one-time settlement of default in export obligations by the holders of advance and EPCG (export promotion for capital goods) authorisations.
Under the scheme, all pending cases of the default in meeting export obligations (EO) of certain authorizations can be regularised by the authorisation holder upon payment of all customs duties that were exempted in proportion to unfulfilled EO and interest at the rate of 100% of such duties exempted.
However, no interest is payable on the portion of additional customs duty and special additional customs duty.
All those authorization holders who are interested in availing themselves of the scheme will have to register themselves with the DGFT before June 30 this year. And they have to complete the payment of customs duty plus interest by Sept. 30, 2023.
"Cases under investigation or cases adjudicated for/involving fraud, misdeclaration, or unauthorised diversion of material and/or capital goods will be excluded from the coverage (of the scheme)," the directorate general of foreign trade (DGFT) has said in a public notice.
DGFT is an arm of the ministry that deals with exports and imports for the country.
EPCG is an export promotion scheme under which an exporter can import a certain amount of capital goods at zero duty for upgrading technology related to exports, subject to an export obligation. The objective of the scheme is to facilitate the import of capital goods for producing quality goods and services.
The authorisation holder (or exporter) under the schemes has to export finished goods worth six times the actual duty saved in value terms in six years. The authorisation is valid for import for 24 months from the date of issue, and revalidation of the authorisation will not be permitted.
An advance authorisation scheme allows the duty-free import of inputs that have to be mandatorily used in products that are required to be exported within a specified time. They are not allowed to sell the products on the domestic market. In addition to any inputs, packaging material, fuel, oil, and catalyst that are consumed or utilised in the process of producing export products are also allowed.
However, the export obligation may be fulfilled within 18 months from the date of the authorization under this scheme.
If an authorisation or license holder fails to fulfil the average export obligation in a given period, then he or she is liable to pay customs duties with specified interest per year to the customs authority.
The DGFT also said that authorisations issued under these two schemes issued under FTP (2009–14) till March 31, 2015 are covered under the amnesty scheme. However, authorisation issued under FTP 2004-09 and before that, the coverage of the scheme is limited to those authorizations whose export obligation period was valid beyond August 12, 2013.
It added that if duty and applicable interest have already been deposited in full, the case would not be eligible for coverage.
"One-time facility is being provided for grant of EODCI regularisation of cases of EO default of Advance Authorisation and ECG authorizations under 'Amnesty scheme for one-time settlement of default in export obligation by Advance and EPCG authorisation holders".
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