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Epcg

saurabh (Manager) (26 Points)

13 January 2012

We are manufacturer of Agrochemicals (Pesticides, Fertilizers, Micronutrients, PGR & PGP) and having branches on PAN INDIA Basis as well as we are exporting our products to various countries.

Infact, we would like to avail the benefits under EPCG Scheme for which we have certain querry. We would be highly thankful if you may kindly provide the underbelow mentioned details:

Are we covered under the Category of ZERO DUTY OR 3% DUTY under EPCG Scheme? If we are into 3% duty than this 3% duty is the total duty?
In case of domestic purchase, how this EPCG scheme is effective since we are covered under SSI and is Excisable Unit.

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5 Replies

RAMESH KUMAR VERMA ( CS PURSUING ) (43853 Points)
Replied 13 January 2012

EPCG:

In the case of agro units, import of capital goods at 3% Customs duty shall be allowed subject to a fulfillment of an export obligation equivalent to 6 times the duty saved (on capital goods imported under the Scheme) over a period of 12 years from the date of issue of Authorisation.

An LUT/ Bond or a 15% BG (as the case may be) may be given for EPCG Authorisation granted to units in the Agri Export Zones provided the EPCG Authorisation is taken for export of the primary agricultural product (s) notified in Appendix 8 of Handbook of Procedures or their value added variants.

Conditions for import of Capital Goods:

Import of capital goods shall be subject to Actual User condition till the export obligation is completed.

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saurabh (Manager) (26 Points)
Replied 13 January 2012

Thanks for your kind reply.

So, you mean to say that Agrochemicals comes under the category of AGRO UNITS and hence 3% Custom Duty is applicable. Am i right than please confirm the same.

Further, Can you please update regarding my querry for point no 2 i.e In case of domestic purchase, how this EPCG scheme is effective since we are covered under SSI and is Excisable Unit.

your kind revert will be highly appreciable.

Thanks and Regards,

Saurabh Abhiranjan

9311155089

RAMESH KUMAR VERMA ( CS PURSUING ) (43853 Points)
Replied 13 January 2012

AS PER PARA 5.6 OF FOREIGN TRADE POLICY 2009-2014

"A person holding an EPCG license may source the capital goods from a domestic manufacturer instead of importing them. The domestic manufacturer supplying capital goods to EPCG license holders shall be eligible for refund of Excise Duty paid by him. In addition the indigenous supplier can import his own raw material duty free"

for More info Read must below mentioned link:

/forum/epcg-amp-cenvat-credit-126933.asp