The document provides an overview of India's legal framework and policies regarding foreign trade. It discusses the changing global trade environment that led India to shift from import substitution to export-led growth. The key laws governing foreign trade in India are outlined. Objectives of the 2009-2014 Foreign Trade Policy include doubling exports by 2014 through incentives, market expansion, and improving infrastructure. Strategies focus on fiscal incentives, procedures, market access, and sectoral support.

1. Introduction to Foreign Trade
Policy
SESSION 1
LEGAL ENVIRONMENT OF BUSINESS
1

2. Background
 Waves of change:
 Condition before 90s
 New world economic order
 Globalisation, Liberalisation of trade and investment
 Development of IT & communication
 Rule based multilateral trading systems – Uruguay
round
 Reduction in M tariffs & removal of non-tariff barriers

3. WHY EXPORTS?
 Foreign exchange requirement
 Rapid economic development - High growth rates
have been achieved by many Asian countries
 India – since July 1991 – liberalisation,
globalisation, privatisation
 Promotion of exports treated as a national priority
 Trade policy integrated with overall strategy of
economic development
 Paradigm shift from import substitution –led
growth to export led-growth

4. How is it different ?
 International trading environment (trade
agreements, policies)
 Consumer preferences in different markets
 Terms & conditions of biz
 Communication and negotiations hold the key
 Logistics plays important role
 Realising payment against the shipment
 Claiming incentives/facilities

5. Foreign Trade Policy
27 August 2009 - 31 March 2014
th st
Government of India
Ministry of Commerce and Industry
Department of Commerce
Website: http://dgft.gov.in
FOREIGN TRADE POLICY 2009-14
5

6. In India,
the legal framework for regulation of international
trade is mainly provided by the Foreign Trade
(Development And Regulation) Act, 1992  which
replaced the earlier law namely, the Imports &
Exports (Control) Act 1947 
6

7. The Ministry of Commerce, Government of India,
formulates the Foreign Trade Policy (Export –
Import policy), in terms of section 5 of the
Foreign Trade (Development And Regulation)
Act, 1992
7

8. In India, Legal Framework for foreign trade is
provided by:
Foreign Trade (Development And Regulation)
Act, 1992
Export (Quality Control and Inspection) Act, 1963
Customs & Central Excise Duties Drawback Rules,
1995
Foreign Exchange Management Act, 1999
Customs and Central Excise Regulations
8

9. Foreign Trade Policy : 2009-14
Main policy provisions are given in Foreign
Trade Policy : 2009-2014
Covers procedures, agencies & docs required to
take advantage of certain provisions of policy
9

10. Foreign Trade Policy : 2009-14
 Deals with EXIM of merchandise and services
 Policy has been described in the following:
 Foreign Trade Policy : 2009-14
 Handbook of Procedures - Volume I
 Handbook of Procedures - Volume II
 ITC (HS) Classification of Import-Export Items
10

11. Achievements of FTP 2003-2008
2003-04 2008
EXPORTS USD 63 bn USD 168 bn
Share of global 0.83% 1.45%
merchandise trade
share of global 1.4% 2.8%
commercial services
export
share in goods and 0.92% 1.64%
services trade
14 million jobs were created due to increased exports in
the last 5 years
11
*WTO estimates

12. Objectives of FTP 2009-2014
Short term
to arrest and reverse the declining trend of
exports
to provide additional support to those sectors
which have been hit badly by recession in the
developed world
to achieve 15% annual export growth (US$ 200
bn March 2011)
12

13. Objectives of FTP 2009-2014
Short term
to achieve an annual growth of 25% upto 2014
to double India’s exports of goods and services
by 2014
long term
to double India’s share in global trade by 2020
13

14. Strategy for implementation of FTP
fiscal incentives
institutional changes
procedural rationalization
enhanced market access across the world
diversification of export markets
14

15. Strategy for implementation of FTP
Neutralising the incidences of all levies, duties
on inputs used in exports
Duties/levies should not be exported
Avoiding skewed duty structure and ensuring
that India's domestic sectors are not
disadvantaged in FTA/RTA/PTA that India enters
into
15

16. Strategy for implementation of FTP
Identifying and nurturing special focus area for
generating employment in semi-urban and rural
areas
Facilitating technological and infrastructural
upgradation of all sectors of Indian Economy,
especially through import of capital goods & equipment
16

17. Strategy for implementation of FTP
Revitalising Board of Trade by redefining its role,
giving it due recognition & inducting experts on
FTP
Activating India's embassies as key players for
trade intelligence and enquiry dissemination by
linking commercial wings of the embassies through
an electronic platform
17

18. Strategy for implementation of FTP
under advance authorization scheme, a
minimum of 15% value addition on imported
inputs has been stipulated
diversification of products and markets through
enhancement of incentive rates in particular
product group and market
Additional resources have been made available
under the Market Development Assistance
Scheme and Market Access Initiative Scheme.
18

19. Strategy for implementation of FTP
for market expansion
Comprehensive Economic Partnership Agreement
with South Korea
Trade in Goods Agreement with ASEAN w.e.f. 1.1.10
Mercosur Preferential Trade Agreement
Promotion of Brand India through more than six
‘Made in India’ shows across the world
Technological upgradation : promoting imports of
capital goods under EPCG at 0% duty
19

20. Strategy for implementation of FTP
 ‘Towns of Export Excellence’ and units located
therein have been granted additional focused
support and incentives.
 high level coordination committee in the
Department of *Commerce facilitates X’s by
creating synergies in the line of credit extended
through EXIM Bank for new & emerging markets
20
*committee = Ministry of External Affairs + Department of Economic Affairs + EXIM Bank + R.B.I.

21. Strategy for implementation of FTP
 zero duty EPCG scheme and incentives for
production and export of ‘green products’
 e-trade project : to reduce transaction cost and
institutional bottlenecks
 Additional ports/locations are being EDI
(Electronic Date Interchange) enabled
21

22. Strategy for implementation of FTP
 single window mechanism : Inter-Ministerial
Committee has been estd. to resolve trade
related grievances
22

23. Schemes to Encourage X
 SERVED FROM INDIA SCHEME (SFIS)
 FOCUS MARKET SCHEME (FMS)
 VISHESH KRISHI AND GRAM UDYOG YOJANA (VKGUY)
 FOCUS PRODUCT SCHEME (FPS)
 Scheme for Assistance to States for Developing
Export Infrastructure and Allied Activities (ASIDE)

24. Policy initiative
 SPECIAL FOCUS INITIATIVES
 Market Diversification
 26 new countries have been included within the ambit
of Focus Market Scheme.
 The incentives provided under Focus Market Scheme
have been increased from 2.5 % to 3 %.

25. Policy initiative
 Support to status holders
 additional duty credit scrip @ 1 % of the FOB of
past export shall be granted for specified product
groups including leather, specific sub sectors in
engineering, textiles, plastics, handicrafts and jute
 Handlooms
 Duty free import entitlement of specified trimmings
and embellishments is 5% of FOB value of exports
during previous financial year
 No custom duty on Machinery & equipment for ETP
 Duty free import of old pieces of hand knotted
carpets on consignment basis for re-export after
repair is permitted

26. Policy initiative
 Handicrafts
 Duty free import entitlement of tools, trimmings and
embellishments is 5 %of FOB value of exports during
previous financial year.
 No custom duty on Machinery and equipment for ETP
 All handicraft exports would be treated as special Focus
products and entitled to higher incentives.
 Leather and Footwear
 Duty free import entitlement of specified items is 3 % of
FOB value of exports of leather garments during preceding
financial year.
 Re-export of unsuitable imported materials such as raw
hides & skins and wet blue leathers is permitted.
 Re-export of unsold hides, skins and semi finished leather
shall be allowed from Public Bonded warehouse at 0% of
the applicable export duty.

27. General Provisions Regarding EXIM
 Free EXIM unless regulated
 Can X gifts of value < Rs. 5L in a licensing year
 All X contracts and invoices shall be
denominated either in freely convertible
currency or Indian rupees but X proceeds shall
be realised in freely convertible currency
 Units in SEZ shall be exempted from service tax

28. General Provisions Regarding EXIM
 For all goods and services exported from India,
services received / rendered abroad, where ever
possible, shall be exempted from service tax
 new grievance redressal mechanism has been
put in place to facilitate speedy redressal of
grievances of trade and industry

29. Main Provisions : FTP 2004-09
1. *Stability of Policy
2. Liberalised Exports & Imports
3. Imports of capital goods
4. Export Promotion Capital Goods scheme
5. Duty Exemption/Remission Scheme
6. *Import of Replacement of Goods
7. *Export and Import of Free Trade Samples
8. *Replacement of Defective Goods
9. *Export of Goods after Repairs
10. *Export of Imported Goods 29

30. Main provisions : FTP 2004-09
2. Liberalised Exports & Imports
 Provides for liberalised EXIM
 Also provides for Restrictions based on
protection of
a. Public morals
b. Human, Animal or Plant life or health
c. Patents, Trademarks, Copyrights
d. National Treasures (art, history, etc.)
e. Prevention of use of prison labour
f. Conservation of exhaustible natural resources
30

31. Main provisions : FTP 2004-09
2. Liberalised Exports & Imports
EXPORT of various items can be classified into
four categories
A. Prohibited
B. Restricted
C. State Trading Enterprise
D. Free with terms and conditions
31

32. Prohibited
 Can’t be exported!!!
32

33. Restricted
 Can be exported only against a valid export
licence or subject to such conditions as may be
specified for a particular item in *ITC(HS)
Classification
 Export Licence is granted against confirmed
export order only
33
*Indian Trade Clarification based on Harmonized System of Coding

34. State Trading Enterprise
 Items can be exported by designated agencies
of Central/State govt.
E.g. STC (State Trading Corporation), IOC,
MMTC (Metals and Minerals Trading
Corporation of India), etc.
34

35. Free with terms & conditions
 Certain items are free to export
 No licence is required.*
*Subject to conditions like
a) Minimum export price
b) Registration with export promotion council
c) Registration of export contracts, etc.
35

36.  Items which don’t fall in any category can
be exported without any restriction!!!
36

37. Import policy has also divided the various
items of IMPORT into 4 categories
a. Prohibited
b. Restricted
c. Canalised
d. STE
37

38. Prohibited
 Can’t be imported
 BEEF, IVORY, etc.
38

39. Prohibited items
• All forms of wild life including their parts and products except Peacock Tail
Feathers, including handicrafts made thereof and manufactured articles,
and shavings of Shed Antlers of Chital and Sambhar subject to conditions.
• Exotic birds
• wild orchids, as well as plants as specified
• Beef
• Human skeletons
• Tallow, fat and/or oils of any animal origin excluding fish oil
• Wood and wood products in the form of logs, timber, stumps, roots, barks,
chips, powder, flakes, dust, pulp and charcoal except sawn timber made
exclusively out of imported teak logs/timber subject to conditions
• Chemicals included in Schedule 1 of the Chemicals Weapons Convention
of the United Nations
• Sandalwood in any form, but excluding fully finished handicrafts made out
of sandalwood and machine finished sandalwood products
• Red Sanders wood in any form, whether raw, processed or unprocessed as
well as any product made thereof.

40. Restricted
 Can be imported only against a valid import
licence
40

41. Restricted items
• Cattle, Camel
• Chemical fertilizers
• Dress materials/readymade garments fabrics/textile
items with imprints of excerpts or verses of the Holy
Quran
• Hides and skins
• Viscose staple fibre (Regular), excluding high
performance viscose staple fibre
• Silk worms, silkworm seeds and silk worm cocoons
• And the list goes on and on …

42. Canalised
 Items can be imported only through
designated agencies of GOI
42

43. Canalised items
 Petroleum products
 Mica waste
 Mineral ores , concentrates and compounds
 Niger seeds
 Onions

44. State Trading Enterprise
 Import of items is permitted by STE
 Solely in accordance with commercial
considerations including PRICE, QUALITY,
AVAILABILITY, MARKETABILITY,
TRANSPORTATION, ETC.
 Items – wheat, rice, urea, petrol, diesel, etc.
44

45.  Exporter is required to obtain export
licence for each order in case of export of
restricted item
 Exporter should take into account the
impact on delivery schedule before
agreeing on delivery dates.
45

46. Main provisions : FTP 2004-09
3. Imports of capital goods
 Today, no licence required, just pay import duty
 a firm can import second hand capital goods
w/o any import licence, no age restriction
 Minm value of 2nd hand plant & m/c = 25 cr.
46

47. Main provisions : FTP 2004-09
4. Export Promotion Capital Goods scheme
 To enable cost competitiveness, GOI introduced
EPCG scheme
 Firms now pay only *5% custom duty
 Capital goods includes :
a) New as well as second hand capital goods
b) Computer software systems
c) Spares, jigs, dies, fixtures & moulds
d) Components of capital goods
e) Spares of existing plant & machinery
47
*subject to fulfillment of export obligation

48. Main features of EPCG scheme
Eligibility of import
Following firms can import at 5% duty
 1 Manufacturer Exporters, 2 Merchant Exporters
and 3 Service providers
 Common service providers in towns of export
excellence, e.g. Tirupur, Panipat, Ludhyana
 Retailers having minimum area of 1000 sq.mt.
 Project imports notified by the Central Board of
Excise & Customs wherein basic customs duty
on imports is 10% with a CVD of 16%
48

49. Main features of EPCG scheme
Amount of Export Obligation
 8 times the amount of duty saved on import of
capital goods under this scheme
 6 times the amount of duty saved in case of
 SSI units provided the landed CIF value of
capital goods < 25 lakhs and after inclusion of
goods should be < SSI limit of investment (1Cr.)
49

50. Main features of EPCG scheme
Period of Discharge of Export Obligation
 Within 8 years from date of issuance of licence.
 Up to 12 years in the following cases:
 Amount of duty saved is > 100 crores
 EPCG licence holder is a unit under the revival plan of
BIFR (Banking for Industrial and Financial
Restructuring)
 Licence holder is in Agri-export zone
50

51. Main features of EPCG scheme
Discharge of Export Obligation
1. Export obligation can be fulfilled by export of
goods which can be manufactured by imported
capital goods.
2. If the licence holder fulfills > 75% of export
obligation (including avg. level of export) in half
the period of export obligation, the remaining
obligation is condoned and licence is redeemed
51

52. Main features of EPCG scheme
Discharge of Export Obligation
3. Licence holder shall fulfill export obligation over the
specified period in the following proportions
Period of export obligation Minimum export obligation to
(8 years) be fulfilled
1 to 6th year 50 %
7th and 8th year 50 %
Period of export obligation
(12 years)
1 to 10th year 50 %
11th and 12th year 50 %
Export obligation of a particular block of years may be set off by the excess of
52
export made in the preceding block of year

53. Main features of EPCG scheme
Leasing of Capital Goods
 Licence holder may source new capital goods
from domestic leasing company/domestic
manufacturer.
 No permission of licensing authority is required
under leasing financial arrangement
 Licence holder alone shall be responsible for
fulfillment of export obligation
53

54. Main provisions : FTP 2004-09
5. Duty Exemption/Duty Remission Scheme
 FTP provides for duty exemption/ remission
scheme + EPCG scheme to augment Indian
export
 Exporters can import duty free inputs required
for manufacture of products for export
54

55. Main features of EPCG scheme
Period of Export Obligation
 Should be fulfilled within 24 months from date
of licence
 Can be extended by 6 months to composition fee
of 2% of duty saved on unutilised imported
items
 Can be extended further by 6 months : pay 5%
55

56. SEZ, EOU, STP & EHTP
Schemes
56

57. Schemes For Encouraging Exports
All nations encourage exports…..
….to counter adverse Balance of Trade
Various schemes to encourage exports
Mainly supported and supervised by
Ministry of Commerce
EPC for various categories
57

58. Export Incentives for Manufacturer
Indigenous inputs w/o payment of excise duty
No excise charged on final product
Imported inputs w/o payment of customs duty
No export duty on export of final product
Fast finance at concessional interest rates
Exemption from income tax
Exemption from SALES TAX on final product
(refund of CST paid on inputs in certain cases)
58

59. WTO STIPULATION
‘No country can give export incentives’
However….goods can be made tax free for export
purpose
All export promotion schemes ensure that inputs
as well as final products are made ‘TAX FREE’
59

60. Input Duty Relief Scheme
Various schemes – to obtain duty free inputs OR
get refund later
1. Some schemes – unit has to be isolated from
domestic production units
E.g. EOU, STP, EHTP and SEZ
60

61. Input Duty Relief Scheme
2. Other schemes –domestic producers are also
entitled to get inputs/capital goods free of taxes
E.g. a) Advance Licence scheme
b) Duty Entitlement Pass Book scheme (DEPB)
c) Duty Free Replenishment Certificate
scheme (DFRC)
d) EPCG scheme (Export Promotion Capital
Goods scheme)
61

62. Input Duty Relief Scheme
e. Rebate of duty on inputs if final product is
exempt from duty
f. Under duty drawback scheme, excise duty paid
on inputs is returned as rebate
62

63. Highlights of EOU/SEZ scheme
SEZ unit has to be located within the specified
zones developed, 114 operational, another 500
formally approved
EOU unit can be set up at any of over 300 places
all over India
Currently there are 114 SEZs (as of October 2010) operating throughout India in the following states[8]: Karnataka - 18; Kerala - 6;
Chandigarh - 1; Gujarat - 8; Haryana - 3; Maharashtra - 14; Rajasthan - 1; Tamil Nadu - 16; Uttar Pradesh - 4; West Bengal - 2: Orissa -
1.
Additionally, more than 500 SEZs are formally approved (as on October 2010) by the Government of India in the following states[9]:
Andhra Pradesh - 109; Chandigarh - 2; Chattisgarh - 2; Dadra and Nagar Haveli - 4; Delhi - 3; Goa - 7; Gujarat - 45; Haryana - 45;
Jharkhand - 1; Karnataka - 56; Kerala - 28; Madhya Pradesh - 14; Maharashtra - 105; Nagaland - 1; Orissa - 11; Pondicherry - 1;
Punjab - 8; Rajasthan - 8; Tamil Nadu - 70; Uttarkhand - 3; Uttar Pradesh - 33; West Bengal - 22. 63

64. Highlights of EOU/SEZ scheme
Similarly, STP/EHTP unit can be situated
within SEZ or at any place where EOU can
be set up
64

65. Highlights of EOU/SEZ scheme
No custom duty on import of capital
goods, raw materials, consumables,
packing material, spares etc.
No excise duty on indigenous inputs
*Second hand capital goods can also be imported.
65

66. Highlights of EOU/SEZ scheme
Have to achieve +ve NFE (Net Foreign
Exchange Earnings). NFE = A – B
A= FOB value of exports
B = CIF Value of all imported inputs and
capital goods and all payments made in
foreign exchange.
66

67. Requirements of +ve NFE
calculated cumulatively for 5 yrs from
commencement of commercial production
All foreign exchange outgo is included*
67

68. Foreign exchange outgo includes…
Capital goods
Raw materials
Consumables and spares
Dividend payable in foreign exchange
Royalty to collaborators
Design and know-how fee
68

69. Foreign exchange outgo includes…
Payment to foreign technicians
Training to Indian technicians abroad
Foreign travel
Interest paid on ECB / deferred payment credit
Any other payment in foreign exchange.
69

70. If NFE is not achieved, duty and
interest in proportion to default will
be payable
70

71. Highlights of EOU/SEZ scheme
EOU Minimum investment in plant and
machinery and building = Rs 1 crore. This
should be before commencement of
commercial production
SEZ No such limit
71

72. Highlights of EOU/SEZ scheme
A bond in prescribed form has to be executed.
EOU B-17
SEZ  Form prescribed in SEZ Rules, 2003
*There is NO physical supervision of customs / excise
authorities over production and clearances, BUT
prescribed records are required to be maintained.
72

73. Highlights of EOU/SEZ scheme
EOU Fast Track Clearance Scheme (FTCS) for
clearances of imported consignments
SEZ  customs clearance for export and import is
obtained within the zone itself
73

74. Highlights of EOU/SEZ scheme
Generally, all final production should be exported,
EXCEPT rejects up to prescribed limit.
74

75. Highlights of EOU/SEZ scheme
Sale within India should be on payment of excise
duty = normal customs duty (If imported)
Exceptions In certain cases, excise duty payable
= 50%/30% of normal customs duty applicable if
goods are imported into India
75

76. Highlights of EOU/SEZ scheme
SUB-CONTRACTING is allowed subject to
permission on annual basis
JOB WORK for exports is permitted
SAMPLES can be sold / given free within
prescribed limit
UNUTILISED RAW MATERIAL can be disposed of
on payment of applicable duties
76

77. Highlights of EOU/SEZ scheme
The unit can EXIT (DE-BOND) with
permission of Development Commissioner,
on payment of applicable duties.
77

78. Highlights of EOU/SEZ scheme
EOU Central Sales Tax (CST) paid on
purchases is refundable. Refund is obtained
from Development Commissioner
SEZ  Supplier DOES NOT have to pay CST
78

79. Highlights of EOU/SEZ scheme
Prescribed %age of foreign exchange
earnings can be retained in *EEFC account in
foreign exchange
100% foreign equity is permissible, except
in a few cases*
*EEFC A/C – Exchange Earners Foreign Currency Account
79

80. Highlights of EOU/SEZ scheme
Supplies made to EOU by Indian supplier are
‘deemed exports’ and supplier is entitled to
benefits of ‘deemed export’
Supplies to SEZ are ‘exports’ and all export
benefits are available
80

81. Highlights of EOU/SEZ scheme
Restrictions under Companies Act on
*managerial remuneration are not
applicable
No restrictions on External Commercial
Borrowings
*20 lakhs/month
81

82. STP / EHTP UNIT
Concept of STP/EHTP is similar to EOU/SEZ.
Administered by Ministry of Information
Technology.
STP/EHTP unit can be set up as an EOU unit
anywhere in India or as a SEZ unit at specified
developed locations in India.
82

83. STP / EHTP UNIT
A software development firm qualifies as
STP/EHTP unit.
Can import goods on loan from clients for
specific period.
Can export software electronically or through
physical transport.
83

84. STP / EHTP UNIT
Activities allowed…..
exports of professional services
development of computer software
data entry and conversion
data processing, analysis and control
data management
call centre services.
84

85. Which Scheme to Choose?
If your major production is towards sale in DTA
(Domestic Tariff Area), schemes like DEPB* or
DFRC* or Advance License are suitable.
* Duty Entitlement Passbook scheme (DEPB)
* Duty Free Replenishment Certificate scheme (DFRC)
85

86. Schemes like EOU/SEZ are suitable
when the undertaking is predominantly
export oriented
Requirement of imported capital goods
and raw material is high
86

87. EOU vs. SEZ
‘EOU is more flexible than SEZ’
Wide choice of location (EOU unit can be
set up at any place declared as ‘warehousing
station’ under Customs Act) [300 places]
EOU can be set up even within a part of
the factory, thus saving considerable costs.
Even use of common utilities is possible.
87

88. EOU vs. SEZ
EOU is more flexible than SEZ
If export orders dry up, conversion of EOU
to DTA unit by exit (de-bonding) is
comparatively very easy.
In case of SEZ, the unit has to be physically
moved out of the zone after exit (de-
bonding).
88

89. EOU vs. SEZ
On the other hand
infrastructure available at SEZ unit is much
better than EOU units.
Customs clearance for exports is obtained
within the zone itself, which is convenient.
89

90. Overview of EOU/SEZ scheme
EOU/SEZ schemes are under Ministry of
Commerce
Basic Policy of EOU : Chapter 6 of Export
and Import Policy 2009-2014
Procedural Aspects : Chapter 6 of
Handbook of Procedures Volume I
90

91. Overview of EOU/SEZ Scheme
Prescribed Forms : Appendices to the
Handbook of Procedures
EOU units are closely connected with
Customs Law, Excise Law, Income Tax Act and
Foreign Exchange Management Act
91

92. Power
Power generation/distribution can be set
up in EOU/STP unit.
can supply surplus power to another
EOU/STP/EHTP/SEZ unit.
Can supply surplus power to DTA unit on
payment of duty on consumables and raw
materials used for power generation
92

93. Service Sector
Duty free imports will be permitted ONLY
to units exporting services and NOT to
domestic service providers
Further, NO trading units are permitted
Each EOU must have its website and e-mail
address.
93

94. EOU/SEZ/STP/EHTP unit can be set up with
100% foreign investment, except few
*restricted sectors
SEZ unit can manufacture articles reserved
for SSI even if foreign equity exceeds 24%
No license is required
94

95. PERMISSIBLE CAPITAL GOODS
material handling equipments, captive power
plants, office equipment, tools, prototypes, AC
system, computers, laptops can be brought as
'capital goods' IF these are essential in
manufacture of goods
should be located in regd./administrative
office
95

96. ANTI-DUMPING DUTY or SAFEGUARD DUTY
Not applicable for imports by EOU or SEZ
units, UNLESS it is specifically made
applicable
96

97. CT-3 CERTIFICATE
The EOU/EHTP/STP unit can procure
indigenous material w/o payment of excise
duty.
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98. EXPORT/IMPORT OF DEFECTIVE
INPUTS/FINAL PRODUCTS
98

99. RETURN OF REJECTED GOODS TO
INDIGENOUS SUPPLIER
99

100. INTER UNIT TRANSFER
Inter unit transfers of manufactured goods
and capital goods from one EOU/SEZ unit
to another EOU/SEZ unit w/o payment of
duty is permitted.
100

101. EOU : Allowed Activities
Besides manufacturing,
(a) Import of goods for service activities
(b) Reconditioning, repairs of imported goods and
return to foreign suppliers
(c) Destruction of waste and rejects with
permission of Asstt. Commissioner even outside
the premises
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102. EOU – Allowed Activities
SERVICE has also been included as 'export
product' as per EXIM Policy.
102

103. Routine procedures by EOU unit
QUARTERLY AND ANNUAL REPORT
Submit in prescribed form to
Development Commissioner.
103

104. Routine procedures by EOU unit
Maintenance of Separate Accounts
separate accounts and balance sheet of
EOU and Domestic Unit is required to claim
Income tax benefits.
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