Government of India
Ministry of Finance
Department of Revenue
New Delhi, the 16th February,2009.
Circular No.8 /2009-Cus.
Sub: Applicability of notification No 41/2005-Cus to the goods imported against
the credit Scrips issued under para 3.8.6 of Foreign Trade Policy (FTP)
(2008-09) under Vishesh Krishi Gram Udyog Yojana (VKGUY) scheme – Reg
Reference is invited to para 3.8.6 of the Foreign Trade Policy (FTP) wherein
Status Holders have been incentivized with duty credit scrips equal to 10% of
the FOB value of agricultural exports(including benefits entitled under para
3.8.2 of the FTP). These Duty Credit Scrips can be used to import specified
capital goods/equipment meant for development of agricultural infrastructure. In
this connection, Directorate General of Foreign Trade had requested that a
circular may be issued to implement the aforesaid provision.
- The matter has been examined by the Board. In this regard, I am directed to
say that Notification No.41/2005-Cus exempts all goods including capital goods
which are freely importable, when imported into India against the duty credit
certificate issued under Vishesh Krishi Gram Udyog Yojan (VKGUY) in accordance
with para 3.8 of FTP. Since para 3.8 of FTP covers para 3.8.6 also, it is
clarified that, the present Notification No 41/2005-Cus would cover imports
under para 3.8.2 and para 3.8.6 of FTP.
- It may be mentioned that in terms of provisions of the FTP, the duty credit scrips under para 3.8.2 are issued to all exporters against the export of
notified items. These scrips can be used for the import of inputs or goods
including capital goods which are freely importable. Further, the scrips are
freely transferrable. However, the duty credit scrip under para 3.8.6 of FTP can
be issued only to status holders against the agricultural exports and can be
used only for the clearance of capital goods and equipments as specified in the
said para. Further, these duty credit scrips are subject to actual user
condition and are not transferable.
- In view of the above differences in the scrips issued under para 3.8.2 and
para 3.8.6 of FTP, it is desirable that the scrips are properly verified before
allowing import of permitted goods. It is also suggested that, due care may be
taken in granting the exemption to only those goods as permitted under the
respective policy paragraphs. Care may also be taken in permitting
transferability only to those scrips which are issued under Para 3.8.2 of FTP.
- These instructions may be brought to the notice of the field officers by
issuing suitable Standing orders/instructions. Difficulties faced, if any in the
implementation of the Circular may please be brought to the notice of the Board
at an early date.
Yours faithfully,
(P.V.K. Rajasekhar)
OSD(Drawback)
F.NO.605/55/2008-DBK