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Import: Special Provisions

Special provisions allow importers greater flexibility in the import process.

Export Promotion Capital Goods Schemes

Capital goods, including jigs, fixtures, dies, and moulds may be imported at a concessional rate of customs duty, subject to an export obligation to be fulfilled over a period of time. In addition, spare goods worth up to 20 percent of the cost, insurance, and freight (CIF) value of the capital goods may also be imported under the scheme.

Duty Exemption Scheme / Duty Remission Scheme

The Duty Exemption Scheme facilitates import of inputs required for export production. The Duty Remission Scheme enables post-export duty drawback on inputs used in manufacturing of the export product. According to the EXIM Policy, duty-free import of inputs is permitted under the following schemes:

Advance License

This is granted to the merchant exporter or manufacturer exporter for the import of inputs required for the manufacture of goods without payment of basic customs duty.

Annual Advance License

Manufacturer exporter with export performance of 1 million rupees in the preceding year and registered with excise authorities, except for products which are not excisable for which no such registration is required, shall be entitled to an Annual Advance License. The entitlement under this scheme shall be up to 125 percent of the average Free On Board (FOB) value of export in the preceding licensing year. Imports against this are exempted from payment of additional customs duty, special additional duty, antidumping duty, safeguard duty, if any, in addition to basic customs duty and surcharge thereon.

Advance Intermediate License

This license is granted to a manufacturer exporter for the import of inputs required in the manufacture of goods to be supplied to the ultimate exporter holding an Advance License / Special Imprest License.

Special Imprest License

This license is granted for the duty-free import of inputs required in the manufacture of goods to be supplied to the Export Oriented Units, units in Export Processing Zones (EPZs), Software Technology Park (STP), Electronic Hardware Technology Park (EHTP), holders of licenses under the EPCG scheme, projects financed by multilateral/bilateral agencies/funds as notified by the Ministry of Finance (MoF), fertilizer plants if the supply is made under the procedure of International Competitive Bidding, supply of goods to refineries and projects/purposes for which MoF permits import of such goods on zero customs duty.

Diamond, Gem, and Jewelry Export Promotion Scheme

Exporters of gems and jewelry are eligible to import their inputs by obtaining Replenishment License and Diamond Imprest License from the licensing authority. Exporters of gold, silver, or platinum jewelry and articles thereof may import their essential inputs (e.g., precious metals and stones) in accordance with the procedure specified in this regard.

100 Percent Export-Oriented Unit (EOU)

The EOU is an industrial unit offering its entire production, excluding rejects and items otherwise specifically permitted to be supplied to the Domestic Tariff Area (DTA), for exports. Such units may be set up under the EOU/EPZ scheme. While EOUs can be set up anywhere in India subject to certain locational conditions, units in EPZ/FTZ can be set up in specific areas separated from the DTA by physical barriers.

Concessional Rate of Duty

A Concessional Rate of Duty applies for imports of listed goods from Bangladesh, South Korea, and Sri Lanka under the Bangkok Agreement, or goods imported from South Asian Association of Regional Cooperation (SAARC) countries.

Exemptions

Customs duty and tax exemptions are available for for food grains imported from Myanmar, if imported by land.

Exemptions are also available for certain free gifts, donations, and relief and rehabilitation material imported by charitable organizations like the Red Cross Society, CARE, and the government of India.

Goods of foreign origin imported for repairs and return can be eligible for exemptions. These goods include:

Theatrical equipment and costumes imported by visiting foreign troupes
Pontoons for speedy loading and unloading of imported goods
Photographic, filming audio, video, and radio equipment and tapes imported for short films, feature films, and documentaries
Goods for mountaineering expeditions; tags, labels, or printed polythene bags for use on articles for export.

Goods imported for display or use at a fair, exhibition, demonstration, seminar, congress, conference, or similar event can be exempt from duties and taxes.

Certain goods imported for display or use at any specified event such as meetings, exhibitions, and fairs or similar shows or displays, can qualify for exemptions.

Note: The above information is subject to change. Importers and exporters are advised to obtain the most current information from a customs broker, freight forwarder, logistics professionals, or local customs authorities.

Source: Central Board of Indirect Taxes and Customs