15 June 2015

EOUs – FTP provisions incorporated in Excise notifications

Notification Nos. 22/2003-C.E. and 23/2003-C.E. have been amended by Notification No. 28/2015-C.E., dated 15-5-2015 to reflect the new Foreign Trade Policy 2015-20 notified by the Ministry of Commerce on 1st of April. Some of the important changes are,


  • EOUs have been allowed to return, without payment of duty, capital goods transferred earlier by other units.
  • Inter-unit transfer of goods and services to be permitted on case to case basis.
  • De-bonding of units who have not availed any benefit to be easier.
  • EOUs can set up warehousing facility outside, near ports.

Further, period for installation of capital goods and use of other goods after procurement has now been revised. The installation/usage, according to latest amendments by Notification No. 30/2015-C.E., dated 25-6-2015, has to be within the period of validity of Letter of Permission (LoP). LoP in this regard would have the same meaning as assigned in Chapter 6 of the new FTP. It may also be noted that reference to SION is missing in the new sub-clause (ii) to the clause (a) in condition (4) provided in the opening paragraph of the notification.


Foreign Trade Policy, 2015-20 and Handbook of Procedures corrected / amended

Following amendments have been made in the Foreign Trade Policy, 2015-20 by Notification No. 8/2015 dated 4-6-2015. It may be noted that these amendments have come into force from 1-4-2015.


  1. Paragraph 2.06 has been amended to include Lorry Receipt/ Railway Receipt/ Postal Receipt as eligible mandatory documents required for export / import of goods from or into India;
  2. Paragraph 2.46 (II)(d) has been amended to provide that goods imported on payment in freely convertible currency and subsequently re-exported shall not be eligible for any export benefit under the FTP, even if the payment is received in freely convertible currency on such re-export;
  3. Paragraph 3.02 has been amended to clarify that Duty Credit Scrips under MEIS and SEIS can be used even for payment of customs duties on import of capital goods, as per notification issued by Department of Revenue;
  4. Paragraph 3.06 has been amended to provide that benefit of MEIS shall not be available on export of items, which are prohibited for export;
  5. Paragraph 3.09(2)(e) has been amended to exclude service exports from SEZ units from the ineligible categories under SEIS. Therefore, service exporter in SEZ would be eligible for duty credit scrips under SEIS with effect from 1-4-2015;
  6. Paragraph 9.51 (ii) has been amended to correct the scope of Mode 2 (Consumption Abroad) in the definition of ‘Service Provider’. Henceforth, the same shall include supply of service by a person in India to consumer(s) of any other country in India.

Following amendments have been made in the Handbook of Procedures, 2015-20 by DGFT Public Notice No. 16/2015-20, dated 4-6-2015. These amendments have come into force from 1-4-2015.

  1. Paragraph 4.38 has been amended to disallow clubbing of authorizations issued on or before 31-3-2009 and authorizations having different value addition criteria. Changes have also been made in the provision providing acceptable difference in the date of issuance of the authorizations sought to be clubbed, and provision relating to payment of composition fee for accounting or calculation of exports made beyond the export obligation period of the earlier authorization;
  2. Paragraph 4.42 has been amended to clarify that only two (2) extensions of six months each shall be allowed by the concerned regional authority and extension beyond twelve (12) months shall not be allowed;

Paragraph 9.10 has been amended to specify that applications for obtaining benefit of Chapter 3 of the FTP would be disposed of in three days by the DGFT office. Further, time limit for disposal of application for acceptance of BG/LUT has been reduced to 3 days from 15 days.


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