Clarification on Simultaneous issuance of Dual Benefit of Zero duty EPCG and SHIS  to exporters under the FTP 2009-14 – option providing flexibility to return either benefit.

CBEC Circular NO 45/2016-Customs, Dated: September 23, 2016 [F.No.605/60/2013-DBK]

Subject: Incorrect simultaneous issuance of dual benefit of Zero duty EPCG and SHIS to exporters under the FTP 2009-14 – option providing flexibility to return either benefit.

The undersigned is directed to say that instances of simultaneous issuance of zero duty EPCG and SHIS were detected by DRI and highlighted to the DGFT. Subsequently, the CAG of India also mapped the concurrent availing of SHIS and zero duty EPCG not being in line with FTP 2009-14 provisions. The issue revolves around wordings in para 5.1A HBP (27.08.2009), para 5.1(f) FTP (5.6.2012), para 5.1(b) FTP (18.4.2013), para 3.10.3 and 9.3 (HBP).

2.After inter-Departmental consultations, that also took into account wordings in conditions specified in Customs EPCG/Post Export EPCG notification Nos. 101/2009-Cus, 102/2009-Cus, 22/2013-Cus, 5/2013-Cus, 23/2013-Cus and SHIS notification No. 104/2009-Cus and clarifications made in Circular Nos. 26/2009-Cus and 38/2010-Cus, the Public Notice No. 30/2015-2020 dated 8.9.2016 (copy attached) has been issued by the Department of Commerce (DGFT) with the concurrence of Department of Revenue. The aspects notified in the Public Notice are self-explanatory. The Ministry directs that pending issues related to the simultaneous issuance or availing of zero duty EPCG/Post Export EPCG and SHIS shall be decided in terms of the said Public Notice.

3.It was noted by the Ministry that consequent to issuance of the said Public Notice, the bar related to dual issuance placed in Customs notifications insofar as they relate to the FTP 2015-20 become unnecessary. These have been removed through Notification No. 52/2016-Customs dated 23.9.2016 that has suitably amended Notification Nos. 104/2009-Cus, 16/2015-Cus and 17/2015-Cus.

4.The trade and officers should be guided by the Commissioners.

 (Dinesh Kumar Gupta) Director

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