FTP - Export from India Schemes - CBEC brings into force Foreign Trade promises

By Vijay Kumar

THE Foreign Trade Policy (FTP) 2015-2020 allowed two Exports from India Schemes:

(i) Merchandise Exports from India Scheme (MEIS).

(ii) Service Exports from India Scheme (SEIS).

Duty Credit Scrips are granted as rewards under MEIS and SEIS and are freely transferable. The Duty Credit Scrips can be mainly used for :

(i) Payment of Customs Duties for import of inputs or goods, except certain items.

(ii) Payment of excise duties on domestic procurement of inputs or goods, including capital goods as per DoR notification.

(iii) Payment of service tax on procurement of services as per DoR notification.

But these are only wishes as far as they remain only in the Foreign Trade Policy. They will come into force only when CBEC notifies them under the respective statutes of Customs, Central Excise and ST, which they have done now. The CBEC gives effect to these scrips by exemption Notifications. They have issued two exemption notifications each under Customs, Central Excise and Service Tax for the two Schemes as:

Now these scrips will be floating around and will surely be the cause of tremendous litigation. The CBEC has opted for the primitive method of physical scrips which have to be presented before Customs officers, who will validate the amounts on the reverse and these have to be presented to the Central Excise and Service Tax authorities, with a declaration. All too much of contact with officers (elsewhere in this edition of DDT, we have reported the news of a Central Excise Superintendent caught by CBI while demanding a bribe for accepting a bond) and paperwork, leading to complications and fraud.Why can't they do all these electronically, something like DMAT shares? How are they going to GST with this kind of archaic procedures?