Import of Coal (as input) under DFRC Scheme
As per the FTP, a DFRC shall be issued only in respect of products covered under the Standard Input Output Norms (SIONs) as notified by DGFT and the import of fuel under the general norms should be allowed with Actual User condition only. It further stipulates that for fuel, the import entitlement may be transferred only to the Companies, which have been granted authorization to market fuel by the Ministry of Petroleum and Natural Gas. There are certain SIONs in which one of the inputs allowed is coal, which is used either as an important input for the manufacture of resultant export product or the same is used as fuel for energy production.
DGFT has now clarified that wherever coal has been allowed as one of the inputs in SION i.e. when its consumption is directly related to the manufacturing of the export product and not for generation of power, it should be treated at par with other inputs which are transferable under DFRC.
DGFT CIRCULAR NO. 31(RE-2005)/2004-2009/ Dated: October 18, 2005