PRESENTATION ON EXIM

POLICY 2009-2014

PRESENTED BY:
1. JUHI BHAGYA
2. RAHUL FALIYA
3. SACHIN GOKANI
4. ANAM JEENAL
5. KANIL HINSU
6. HEEMA THACKER

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 CUSTOMS TARIFF ACT(CTA)
 An act to consolidate and amend the law relating to
customs duties called the Customs Tariff Act,1975.

 A customs tariff is a tax assessed by government on goods

that are moved across an international border crossing or
port.

 While customs tariffs usually fluctuate for every good, most

tariffs are assessed as a percentage of the good’s overall
declared value.

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CONT.…

 Goods that cross international borders are typically subject to

customs inspections.

 When a good arrives at a port or border crossing, a customs

officer generally examines it.

 He or she then levies any applicable customs tariffs. A good

cannot be carried across a port or border crossing until the
customs tariff has been paid.

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 EXAMPLE

A) Suppose there is an import of ` 50,00,000

B) Add: Basic Tax @ 10% of import (10% of A) ` 5,00,000
C) Add: Education cess tax @ of 2% (2% of B) ` 10,000
D) Higher Education cess tax @ of 1% (1% of B) ` 5,000
E) Total (A+B+C+D) ` 55,15,000
F) Add: Custom Education cess tax @ of 2% (2% of E) ` 1,10,300
G) Higher custom education cess @ of 1% (1% of E) ` 55,150
H) Total (E+F+G) ` 56,80,450
I) Additional Tax @ of 4% (4% of H) ` 2,27,220
J) Grand Total (H+I) ` 59,07,670

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 EXIM POLICY
 The foreign trade of India is guided by the Export Import Policy known
as EXIM Policy.

 DGFT (Directorate General of Foreign Trade) is the main governing

body in matters related to Exim Policy.

 Foreign Trade Act has replaced the earlier law known as the imports
and Exports (Control) Act 1947.

 Aims at developing export potential, improving export performance,

encouraging foreign trade and creating favourable balance of
payments position.

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HIGHLIGHTS OF EXIM
POLICY 2009-14

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 EPCG SCHEME RELAXATION:

 The EPCG scheme allows the import of capital goods for pre-
production, production and post production, which shall include
spares, tools, jigs, fixtures, dies, molds etc. And also the capital
goods required for assembly or manufacturer of capital goods by
the authorization holder.

 Government allows it at 3% Customs duty subject to an export

obligation equivalent to 8 times of duty saved on capital goods
imported.

 To increase the life of existing plant and machinery; In the Exim

Policy 2009-14, the export obligation on import of spares, moulds
etc. under EPCG Scheme has been reduced to 50% of the normal
specific export obligation.

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TECHNOLOGICAL UPGRADATION:

 To aid technological upgradation of our export sector, EPCG Scheme

at Zero Duty has been introduced.

 This Scheme will be available for engineering & electronic products,

basic chemicals & pharmaceuticals, apparels & textiles, plastics,
handicrafts, chemicals & allied products and leather & leather
products.

 The scheme shall be in operation till 31.3.2011.

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 EXPORT ORIENTED UNITS(EOUs):

 Units undertaking to export their entire production of goods and

services may be set up under the Export Oriented Unit (EOU)
Scheme. Electronic Hardware Technology Parks (EHTP), Software
Technology Parks (STP) etc. are included. Trading units are not
covered under these schemes.
 Subjected to conditions:

A. Minimum investment of Rs. 1 crore

B. Must be in a customs bonded factory
C. Legal undertaking with the Development Commissioner
D. A positive net foreign exchange earner over five years from the
commencement
E. A proper account of the imports, consumption and utilization of all
imported materials and exports made by the unit

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CONTD…

 As per the Exim policy 2009-14 EOUs will now be allowed to procure
finished goods for consolidation along with their manufactured goods,
subject to certain safeguards

 During this period of downturn, Board of Approvals (BOA) to consider,

extension of block period by one year for calculation of Net Foreign
Exchange earning of EOUs.

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LEATHER SECTOR

 Leather sector shall be allowed re-export

of unsold imported raw hides and skins
and semi finished leather from public
bonded ware houses, subject to payment
of 50% of the applicable export duty.

 Enhancement of FPS rate to 2%, would

also significantly benefit the leather
sector.

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TEA

 Minimum value addition under

advance authorisation scheme for
export of tea has been reduced
from the existing 100% to 50%..

 Export of tea has been covered

under VKGUY Scheme benefits.

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PHARMACEUTICAL SECTOR

 Export Obligation Period for advance authorizations issued with 6-APA

as input has been increased from the existing 6 months to 36 months,
as is available for other products.

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HANDLOOM SECTOR

 To simplify claims under FPS, requirement of ‘Handloom Mark’ for

availing benefits under FPS has been removed.

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VISHESH KRISHI AND GRAM UDYOG YOJANA
 Objective:-
 To promote the export of fruits, vegetables, flowers
 To promote the export of Forest Based Products
 To promote exports of Gram Udyog Products

 Actions:-
 Capital goods imported under EPCG will be permitted to be installed
anywhere in AEZ.

 The Imports of Cold storage units including Controlled Atmosphere

(CA) and Modified Atmosphere (MA) Stores, pre cooling Units and
mother storage for onions etc is permitted

 Import of pesticides are permitted.

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EXPORT HOUSE AND TRADING HOUSE
 The eligibility for recognition is:

Status Category Export Performance Value

(Rupees in Crores)
Export House (EH) 20
Star Export House (SHE) 100
Trading House (TH) 500
Star Trading House (STH) 2500
Super Star Trading House (SSTH) 7500

 Benefits:

 Exemption from compulsory negotiation of documents through banks.

 100% retention of foreign exchange in EEFC account

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DUTY DRAWBACK SCHEME

A) Suppose there is an import of ` 50,00,000

B) Add: Basic Tax @ 10% of import (10% of A) ` 5,00,000
C) Add: Education cess tax @ of 2% (2% of B) ` 10,000
D) Higher Education cess tax @ of 1% (1% of B) ` 5,000
E) Total (A+B+C+D) ` 55,15,000
F) Add: Custom Education cess tax @ of 2% (2% of E) ` 1,10,300
G) Higher custom education cess @ of 1% (1% of E) ` 55,150
H) Total (E+F+G) ` 56,80,450
I) Additional Tax @ of 4% (4% of H) ` 2,27,220
J) Grand Total (H+I) ` 59,07,670

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EDI SOFTWARE:

EDI software is used by the Custom House Agents(CHAs) for online

documentation procedure.

1. Advance Pro 2003

2. EDI 1.0

3. EDI 1.5

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DOCUMENTS

 Purchase order: This is basically financial document. Customs may want

to see the paperwork to make sure everything is valid.

 Letter of credit – this is used for making payments for imported goods.

 Certificates of origin : Several countries have restrictions on the learn

import of goods from certain other countries, and may apply tariffs .

 Packing list :this contains list of all the items that are in container.

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INVOICE

 Invoice – The most important

document, make sure that a full summary
of goods is outlined and it’s invoiced in
the currency of sale.

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BILL OF LADING

 bill of lading :it works as proof that

the goods have been sent by the
supplier.

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 Thank you…

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