Duty Free Import of Capital Goods (EPCG Scheme)

EPCG Scheme allows import of capital goods for pre-production, production and post-production at Zero customs duty. Alternatively, the Authorisation holder may also procure Capital Goods from indigenous sources in accordance with provisions of paragraph 5.07 of FTP. The EPCG scheme allows duty free import of capital goods new capital goods at NIL Customs duty as against the normal total of 26.428%, thus providing a total duty saved of import value. EPCG comes with condition that export obligation to be fulfilledthat equivalent to 6 times of duty saved, to be done over a period of 6 years. The export obligation needs to be fulfilled by the license holder.We are Chartered Accountant firm provide EPCG Scheme DGFT Services in Pune.

Highlights of EPCG Scheme

Conditions for Import Under EPCG Scheme

Import of capital goods shall be subject to Actual User condition till the export obligation (E.O.) is completed. The following shall apply to the fulfillment of the export obligation:-

  • Physical Exports
  • Deemed Exports
  • Royalty Payments received in Freely Convertible Currency
  • Foreign exchange received for R& D services
  • Supplies to SEZ Units / Supplies to Developers/Co-Developers
  • Port Handling Services
  • Export Obligation can be fulfilled by export of goods Manufactured / Services rendered by the Applicant

Fulfillment of Export Obligation (EO) Under EPCG Scheme

The Authorisation holder under the EPCG scheme shall, while maintaining the average export obligation, fulfill the specific export obligation over the prescribed block period in the following proportions:-

Period from the date of issue of Authorisation Minimum export obligation to be fulfilled
Block of 1st to 4th year 50%
Block of 5th and 6th year Balance EO

The Authorisation holder would intimate the Regional Authority on the fulfilment of the export obligation, as well as average exports, within three months of completion of the block, by secured electronic filing using digital signatures.

EPCG Scheme

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    Recommended For
    Benefit
    Duration
    Statutory Compliances
    RCMC Required
    Applicable for

    MEIS

    Goods Exporter
    Upto 7 % of FOB Value of Export
    1 Month
    No
    Yes
    Past Exports

    SEIS

    Service Exporter
    Upto 7 % of FOB Value of Export
    1 Month
    No
    Yes
    Past Exports

    EPCG

    Manufacturer Exporter
    Upto 100 % Import duty waiver on Capital Goods
    1 Month
    Yes
    Yes
    upcoming Capital Goods Import

    Advance Authorization

    Manufacturer Exporter
    Upto 100 % Import duty waiver on raw material
    1 Month
    Yes
    Yes
    upcoming Raw Material Import

    Compare Your Options

    MEIS

    Recommended For
    Benefit
    Duration
    Statutory Compliances
    RCMC Required
    Applicable for
    Goods Exporter
    Upto 7 % of FOB Value of Export
    1 Month
    No
    Yes
    Past Exports

    SEIS

    Recommended For
    Benefit
    Duration
    Statutory Compliances
    RCMC Required
    Applicable for
    Service Exporter
    Upto 7 % of FOB Value of Export
    1 Month
    No
    Yes
    Past Exports

    EPCG

    Recommended For
    Benefit
    Duration
    Statutory Compliances
    RCMC Required
    Applicable for
    Manufacturer Exporter
    Upto 100 % Import duty waiver on Capital Goods
    1 Month
    Yes
    Yes
    upcoming Capital Goods Import

    Advance Authorization

    Recommended For
    Benefit
    Duration
    Statutory Compliances
    RCMC Required
    Applicable for
    Manufacturer Exporter
    Upto 100 % Import duty waiver on raw material
    1 Month
    Yes
    Yes
    upcoming Raw Material Import