CA Bimal Jain

CA Bimal JainExcise Exemption to Post Export EPCG duty credit scrip under Foreign Trade Policy 2015-2020

The Central Government vide Notification No. 18/2015 – Central Excise dated April 1, 2015  (Given below)has exempted the goods specified in the First Schedule and the Second Schedule to the Excise Tariff Act, when cleared against a Post Export EPCG duty credit scrip issued by the Regional Authority in accordance with Paragraph 5.12 of the Foreign Trade Policy 2015-2020, which provides for duty remission in proportion to export obligation fulfilled from:

  • Whole of the Excise duty leviable under the First and the Second Schedule to the Excise Tariff Act;
  • Whole of the Additional duty of Excise leviable under Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957; and
  • Whole of the Additional duty of Excise leviable under Section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978.

The above stated exemption shall be subject to the condition specified in the Notification.


CBEC vide Notifications No. 18-21/2015-CE,Dated: April 8, 2015 has exempted the goods cleared against a duty credit scrip/post export EPCG duty scrip issued by the Regional Authority under the Foreign Trade Policy 2015-20 from

(i) the whole of the duty of excise leviable thereon under the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985;

(ii) the whole of the additional duty of excise leviable thereon under section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957; and

(iii) the whole of the additional duty of excise leviable thereon under section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978.

The exemption is subject to the conditions listed in the notification. Any amount due to the Central Government under this notification shall be recoverable under the provisions of the said Act and the rules made there under.

Notification No. 18/2015 – Central Excise

Dated-  1st April, 2015

G.S.R. 250 (E) – In exercise of the powers conferred by sub-section (1) of section 5A of the Central Excise Act, 1944 (1 of 1944), read with sub-section (3) of section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and sub-section (3) of section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the goods specified in the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), when cleared against a Post Export EPCG duty credit scrip issued by the Regional Authority in accordance with paragraph 5.12 of the Foreign Trade Policy which provides for duty remission in proportion to export obligation fulfilled (hereinafter referred to as the said scrip) from,-

(i) the whole of the duty of excise leviable thereon under the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986);

(ii) the whole of the additional duty of excise leviable thereon under section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957); and

(iii) the whole of the additional duty of excise leviable thereon under section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978).

2. The exemption shall be subject to the following conditions, namely:-

(a) that the conditions (1) to (14) specified in paragraph 2 of the Notification No. 17/2015 – Customs, dated the 1st April, 2015 are complied and the said scrip has been registered by the Customs authority at the specified port of registration (hereinafter referred as the said Customs authority);

(b) that the holder of the scrip, who may either be the person to whom the scrip was originally issued or a transferee-holder, presents the said scrip to the said Customs authority along with a letter or proforma invoice from the supplier or manufacturer indicating details of its jurisdictional Central Excise Officer (hereinafter referred as the said Officer) and the description, quantity, value of the goods to be cleared and the duties leviable thereon, but for this exemption;

(c) that the said Customs authority, taking into account the debits already made towards imports under Notification No. 17/2015 – Customs, dated the 1st April, 2015, and this exemption, debits the duties leviable, but for this exemption in or on the reverse of the said scrip and also mentions the necessary details thereon, updates its own records and sends written advice of these actions to the said Officer;

(d) that the validity of the said scrip shall be eighteen months from the date of issue and the said scrip shall be valid on the date on which the above debit of duty is made;

(e) that at the time of clearance, the holder of the scrip presents the said scrip debited by the said Customs authority to the said Officer along with an undertaking addressed to the said Officer that in case of any amount short debited in the said scrip he shall pay on demand an amount equal to the short debit, along with applicable interest;

(f) that based on the said written advice and undertaking, the said Officer endorses the clearance particulars and validates, on the reverse of the said scrip, the details of the duties leviable, but for this exemption, which were debited by the said Customs authority, and keeps a record of such clearances;

(g) that the manufacturer retains a copy of the said scrip, debited by the said Customs authority and endorsed by the said Officer and duly attested by the holder of the scrip, in support of the clearance under this notification; and

(h) that the said holder of the scrip, to whom the goods were cleared, shall be entitled to avail the drawback or CENVAT credit of the duties of excise leviable under the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), against the amount debited in the said scrip and validated at the time of clearance.

Explanation – For the purposes of this notification,-

(A) “Export obligation” shall have the same meaning as specified in Notification No. 17/2015 – Customs, dated the 1st April, 2015;

(B) “Foreign Trade Policy” means the Foreign Trade Policy, 2015-2020, published by the Government of India in the Ministry of Commerce and Industry vide notification No.  01/2015-2020, dated the 1st April 2015 as amended from time to time;

(C) “Regional Authority” means the Director General of Foreign Trade appointed under section 6 of the Foreign Trade (Development and Regulation) Act, 1992 (22 of 1992) or an officer authorised by him to grant an authorisation, including a duty credit scrip under the said Act.

[F.No.605/55/2014-DBK]

(Sanjay Kumar)

Under Secretary to the Government of India

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(Bimal Jain, FCA, FCS, LLB, B.Com (Hons), Mobile: +91 9810604563, Email: bimaljain@hotmail.com)

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