Chapter4 Duty exemption/ remission scheme

01 September 2004

Duty exemption and remission schemes	4.1	Duty exemption schemes enable duty free import of inputs required for export production. An Advance Licence is issued as a duty exemption scheme. A duty remission scheme enables post export replenishment/ remission of duty on inputs used in the export product. Duty remission schemes consist of (a) DFRC (Duty Free Replenishment Certificate) and (b) DEPB ( Duty Entitlement Passbook Scheme). DFRC permits duty free replenishment of inputs used in the export product. DEPB allows drawback of import charges on inputs used in the export product.
Re-import of exported goods under Duty exemption/ remission scheme	4.1.1	Goods exported under Advance Licence/ DFRC/ DEPB may be re-imported in the same or substantially the same form subject to such conditions as may be specified by the department of revenue from time to time.
Value addition	4.1.2	The value addition for the purposes of this chapter shall be:- A - B V.A = ----------- x 100, where B V.A Value Addition A FOB value of the export realised /FOR value of supply received. B CIF value of the imported inputs covered by the licence, plus any other imported materials used on which the benefit of duty drawback is being claimed.
		Advance licence
Advance Licence	4.1.3	An Advance Licence is issued to allow duty free import of inputs, which are physically incorporated in the export product (making normal allowance for wastage). In addition, fuel, oil, energy, catalysts etc. which are consumed in the course of their use to obtain the export product, may also be allowed under the scheme. Duty free import of mandatory spares upto 10% of the CIF value of the licence which are required to be exported/ supplied with the resultant product may also be allowed under Advance Licence. MORE REPORTS