Advance Authorization Scheme: Apply For Duty-free Imports

Advance Authorization Scheme: Apply For Duty-free Imports This scheme is for manufacturer-exporters but is not only specific to them. Merchant exporters linked to uplifting manufacturers can also imply. Suppliers to the United Nations and other various programs, who play as subcontractors of the projects, can imply for this scheme if their names are on the contract. The payment here must be convertible and received in convertible foreign exchange. In the situation of pharma imports, the authorization will be prolonged only to manufacturer-exporters. Under this scheme, the manufacturer's interest exemption from primary customs duty, social cess, educational welfare cess, anti-dumping duty, safeguard duty, and countervailing duty. Compensation cess and Integrated goods and services tax even are counted under this scheme.

What details does the advance authorization scheme cover?

The list of inputs selected for duty exemption under this scheme is quite comprehensive. It counts inputs that are physically incorporated into the last product, such as oil, fuel and other catalysts consumed or used to promote the export product. For spare parts that have to be compulsorily exported with the final product, the authorization scheme permits a number of up to 10% of the CIF (cost, insurance, freight) value.

Biotechnological products are permitted if the Department of Biotechnology permits and issues a no-objection certificate.

Selected spices can be imported duty-free specifically by manufacturers who crush, grind, sterilize or manufacture oil or oleoresin. Packaging, cleaning and grading do not qualify as manufacturing, so spices imported for these reasons will not qualify for duty exemption.

Value-addition Requirement The raw materials imported on the scheme can be exported after a value-addition of at least 15%. Although for tea, the value-addition condition is 50%.

Appendix 4D, a piece of the 2015-2020 Handbook of Procedures, lists the products where valueaddition can be lower than 15%. Appendix 4C information the value-addition required for products for which payments are not received in accessible convertible foreign exchange.

Paperwork and fine print Exporters and manufacturers can imply for the scheme on the DGFT's website (www.dgft.gov.in) With a valid importer-exporter (IEC) code. The demand for issuing an advance authorization license is to understand the export rules — in terms of quantity and value of exports within a given time frame.

Applicants must make sure that export proceeds are realized in freely convertible currency, only if otherwise limited. In situation exported goods are re-imported, the regional authority responsible should be informed within a month.

The validity of the advance authorization is 12 months from the date of issue. Although, it is advisable to retain evidence of finishing your obligations for at 18 months from the period of issue of the advance authorization.

For items notified in the SION, advance authorization is also available as an annual requirement.

Although, the exporters have to share their export performance for the previous two years. The value of the export realized should be more than 15% of the CIF value of the input covered by the foreign trade consultants scheme.