Export Promotion Capital goods (EPCG) Scheme
- Import of capital goods for pre production ,production and post production at zero custom duty.(except those specified in negative list in appendix 5F.
- Also exempt from IGST upto 30th September,2018
- Capital goods for the purpose of the EPCG scheme shall includes:
- Capital Goods as defined in Chapter 9 including in CKD/SKD condition thereof;
- Computer software systems;
- Spares, moulds, dies, jigs, fixtures, tools & refractories for initial lining and spare refractories; and catalysts for initial charge plus one subsequent charge.
- Import of capital goods for Project Imports notified by Central Board of Excise and Customs is also permitted under EPCG Scheme.
- Import under EPCG Scheme shall be subject to an export obligation equivalent to 6 times of duty saved on capital goods, to be fulfilled in 6 years reckoned from date of issue of Authorization.
- Authorization shall be valid for import for 18 months from the date of issue of Authorization. (Revalidation of EPCG Authorization shall not be permitted.)
- Second hand capital goods shall not be permitted to be imported under EPCG Scheme.
Export Promotion Capital goods (EPCG) Scheme- Negative list
|Sr No.||Name of item||Importability under EPCG|
|1||cables||Permitted only as an integral part of Capital Goods|
|2||Railway wagons(excluding specialized wagons)||Not permitted|
|4||Trucks/Tippers/Dumpers/ And Spares there of including tyres.||Permitted only to mining sector|
|5||Motor Cars, Sports Utility Vehicle/ All purpose vehicles.||Not permitted|
|6||Airport Ground handling Equipments.||Not permitted|
|7||Furniture, carpets, crockery, marble, chandelier, tiles, flooring, doors for rooms, fixing panels.||Permitted only to hotel industry|
|8||Construction equipments viz. cranes etc.||Permitted only for providing services|
|9||All construction materials like sheds, cement, steel.||Not permitted|
|10||Computers and printers||Not permitted|
|11||All second hand capital goods||Not permitted|
|12||Capital goods (including captive plants and power generator sets of any kind) for export of electrical energy (power)||supply of electrical|
Specific Export obligation :- 6 times of duty saved amount to be fulfilled in 6 years.
Average Export obligation:
EO under the scheme shall be, over and above, the average level of exports achieved by the applicant in the preceding three licensing years for the same and similar products within the overall EO period .
In case of indigenous sourcing of Capital Goods, specific EO shall be 25% less than the normal EO
Note :-Shipments under Advance Authorization, DFIA, Drawback scheme or reward schemes under Chapter 3 of FTP; would also count for fulfillment of EO under EPCG Scheme.
Post-Export EPCG Duty Credit Scrips
- Post Export EPCG Duty Credit Scrip(s) shall be available to exporters who intend to import capital goods on full payment of applicable duties in cash and choose to opt for this scheme.
- Basic Customs duty paid on Capital Goods shall be remitted in the form of freely transferable duty credit scrip(s), similar to those issued under Chapter 3 of FTP.
- Specific EO shall be 85% of the applicable specific EO under the EPCG Scheme. However, average EO shall remain unchanged.
- Duty remission shall be in proportion to the EO fulfilled.
- All provisions for utilization of scrips issued under Chapter 3 of FTP shall also be applicable to Post Export EPCG Duty Credit Scrip (s).
- All provisions of the existing EPCG Scheme shall apply insofar as they are not inconsistent with this scheme.