EPCG scheme allows import of capital goods
for pre production, production and post production
(including CKD / SKD thereof as well as computer
software systems) at 5% Customs duty subject
to an export obligation equivalent to 8 times
of duty saved on capital goods imported under
EPCG scheme to be fulfilled in 8 years reckoned
from Authorisation issue-date.
In case of agro units, and units in cottage
or tiny sector, import of capital goods at 5%
Customs duty shall be allowed subject to fulfillment
of export obligation equivalent to 6 times of
duty saved on capital goods imported in 12 years
from Authorisation issuedate.
For SSI units, import of capital goods at 5%
Customs duty shall be allowed subject to fulfillment
of export obligation equivalent to 6 times of
duty saved on capital goods in 8 years from
Authorisation issue-date and total investment
in plant and machinery after such imports does
not exceed SSI limit.
However, in respect of EPCG Authorisations
with a duty saved amount of Rs. 100 crores or
more, export obligation, shall be fulfilled
in 12 years.
In case CVD is paid in cash on imports under
EPCG, incidence of CVD would not be taken for
computation of net duty saved provided the same
is not Cenvated.
Capital goods shall include spares (including
refurbished/ reconditioned spares), tools, jigs,
fixtures, dies and moulds.
Second hand capital goods without any restriction
on age may also be imported under EPCG scheme.
However, import of motor cars, sports utility
vehicles/all purpose vehicles shall be allowed
only to hotels, travel agents, tour operators
or tour transport operators and companies owning
/ operating golf resorts subject to condition
that :
(i) total foreign exchange earning from
hotel, travel & tourism and golf tourism
sectors in current and preceding three licensing
years is Rs 1.5 crores or more.
(ii) 'duty saved' amount on all EPCG
Authorisations issued in a licensing year for
import of motor cars, sports utility vehicles
/ all purpose vehicles shall not exceed 50%
of average foreign exchange earnings from hotel,
travel & tourism and golf tourism sectors
in preceding three licensing years.
(iii) vehicles imported shall be so registered
that the vehicle is used for tourist purpose
only. A copy of the Registration certificate
should be submitted to concerned RA as confirmation
of import of vehicle. However, parts of motor
cars, sports utility vehicles / all purpose
vehicles such as chassis etc. cannot be imported
under EPCG Scheme.
Import of Restricted items of imports mentioned
under ITC(HS) shall only be allowed under EPCG
Scheme after approval from EFC at Headquarters.
