DGFT vide Trade Notice no. 38 dated 15th March, 2022 have asked exporters to provide following information to claim benefit under Interest Equalisation Scheme.
1. Export Order Value in INR and USD.
2. Tenure of Loan (In months) and Amount of Loan.
3. Amount of Interest Reimbursement Equalisation Claimed.
4. ITC (HS) Code and Product Description.
Information required in above form and cause of concern of each column is as under:-
1. Export Order Value in INR and USD- In this regard, it is submitted as under:
- Portal nowhere specifies what the time period is for which information is to be submitted i.e. it is monthly, quarterly, yearly.
- In case of large exporters having no. of export orders running into thousands, so, it is very difficult to provide details of all orders.
- Further in attachments, copy of export orders are required to be submitted along with the application for generation of UIN. One export order may have many pages. It is very difficult to provide copy of all export orders.
- Many exporters deal in multiple products, there may be export orders after date of submission of application for generating UIN. How details of orders to be received in future can be submitted today.
- It is to mention that RBI vide para 1.1.5 of master circular on “Rupee / Foreign Currency Export Credit and Customer Service to Exporters” have allowed relaxation to certain categories of exporters to avail pre shipment credit as running Facility, thereby requirement to provide export orders to bank before taking loan is waived.
2. Tenure of Loan (In months) and Amount of Loan – In case of running facility, tenure and amount of loan will depend on the period for which credit limit is utilised which will be known only after settlement of export order. Hence, information demanded may not be specifically clear to exporter at the time of filing application on DGFT portal.
As settlement of loan of an export order may take up to 6 months, claim of interest subventions will be submitted accordingly which may lead to much delay from existing system of providing benefit on monthly basis.
3. Amount of Interest Equalisation Reimbursement Claimed:- Due to non-availability of specific data as mentioned in above para , exporter may not be aware of the amount of interest equalisation benefit which he propose to avail in coming year as figure of claim on each order will be final only after settlement of loan of that order.
Export order wise interest calculation from date of issue of a loan till settlement of the loan is not maintained by the exporters , it need to be obtained from bank, which may be another task for exporters to obtain and bank to provide.
Further, banks do not maintain export order wise loan ledger in case of certain
Categories of exporters to whom export credit is provided as running Facility in terms of para 1.1.5 of RBI master circular on export credit.
4. ITC(HS) Code and Product Description – ITC HS code and product description is to be filled as per the export order. In case of multiple products in one export order, he is required to fill all ITC(HS) Code and Product Description of one export order and accordingly he is required to fill one export order many times to fill all product details of one export order. It is not logical to fill 1 export order value many times.
From above, it seems that DGFT expects that the above information be filled up for all export orders in advance on which export credit is availed periodically, after settlement of the loan of that order to arrive at the amount of claim, which will be sent to bank for payment of claim.
If this is really the intention of DGFT to submit the above information as understood.
Above, it will be very tasking for the exporters to prepare claim application, Moreover, in case of an exporter availing export credit from multiple banks the DGFT UIN No. will be required to be generated separately for each bank and submitted to each bank separately.
We do not find any reason to ask for so much of information for providing benefit of Interest Equalisation Scheme to exporters which was being provided flawlessly for last so many years.
However if Revenue / DGFT authorities wish to ascertain
1. Exporter wise benefit availed
2. Product wise benefit availed etc.
They can develop a form to be asked from banks.
In view of above, FIEO, Export Promotion Councils, exporters may approach to concerned authorities to avoid hassles in release of claims of Interest Equalisation Scheme and request them to please simplify the procedure, so that maximum exporters can take benefit of the Scheme.
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