EPCG scheme allows import [1] of capital goods [2] for pre production, production and post production (including CKD / SKD thereof as well as computer software systems) at 3% Customs Duty [3], subject to an export obligation [4] equivalent to 8 times of duty [3] saved on capital goods imported under EPCG [2] 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 [1] of capital goods at 3% Customs duty [3] shall be allowed subject to fulfillment ofexport [5] obligation equivalent to 6 times of duty saved on capital goods imported [6], in 12 years from Authorisation issue- date.
For SSI units, import of capital goods at 3% 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, provided the landed cif value of such imported capital goods [6] under the scheme does not exceed Rs.50 lakhs 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 [7]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 notCENVATed. [7]
Capital goods shall include spares (including refurbished / reconditioned spares), tools, jigs, fixtures, dies and moulds.
Links:
[1] http://www.infodriveindia.com/india-imports-trade-data.aspx
[2] http://www.eximguru.com/exim/dgft/exim-policy/2008/chapter_5_export_promotion_capital_goods_epcg_scheme.aspx
[3] http://www.eximguru.com/indian-customs-duty/default.aspx
[4] http://www.eximguru.com/exim/guides/how-to-export/default.aspx
[5] http://www.infodriveindia.com/india-exports-trade-data.aspx
[6] http://www.infodriveindia.com/india-trade-data/default.aspx?demo=1
[7] http://www.eximguru.com/excise-duty/default.aspx