DGFT Public Notice No. 03/2015-2022 date 13th April 2022

Public Notice No. 03/2015-2022 date 13th April 2022

1. Block-wise Fulfillment of EO (para 5.14)

If the exporter has not fulfilled 50% export obligation allocated in the 1^st block, they must request for block wise extension. Such request should be submitted within 6 months from the date of expiry of 1^st block EO period along with composition fee of 2% on duty saved amount proportionate to the unfulfilled portion of the EO pertaining to the block. Regional Authority (RA) may consider the request of extension of Block wise EO period, received after 6 months, but with 6 years from the date of issue of authorization, with a late fee of Rs. 10,000/- per authorization. Application made beyond 6 years, for extension of block-wise EO period for regularization purpose, shall also be considered by RA concerned, with an additional late fee of Rs. 5000/- for each year per authorization. This late fee is in addition to the composition fee that may be payable in account of shortfall in export obligation. Where EO of the 1^st block is not fulfilled, except in cases where the EO prescribed for 1^st block is extended by the RA, the Authorization holder shall, within 6 months from the expiry of the block, pay duties of customs (along with applicable interest notified by DOR) proportionate to Duty saved amount on total unfulfilled EO of the 1^st block.

2. Annual Reporting of EO Fulfillment (para 5.15)

Authorization holders shall submit to the RA concerned by 30^th of June every year, a report on fulfillment of export obligation through online. Such a report shall contain details such as shipping bill / GST invoice number, date of export / supply, description of product exported / supplied and FOB / FOR value of Export / Supply for both specific as well as average export obligation. Any delay in filing such an annual report shall be regularized on payment of Rs. 5000/- late fees for each financial year per authorization. 

3. Automatic reduction / enhancement upto 10% duty saved amount and pro rata reduction / enhancement in export obligation. (para 5.16)

In excess of the duty saved amount indicated on the authorization by not more than 10%, the authorization shall be deemed to have been enhanced by that proportion. Customs shall automatically allow clearance of such goods without endorsement by RA concerned. The Authorization holder shall furnish additional fee to cover excess imports affected, in terms of duty saved amount, to RA concerned, at the time of application for EODC. Export obligation shall be automatically stand enhance proportionately.

4. Extension in Export Obligation Period (para 5.17)

Request for extension in EO Period shall be made to RA concerned within 6 months from the date of expiry of original EO period. However, RA may consider the request for extension received after 6 month, but within 8 years from the date of issue of authorization, with a late fee of Rs. 10,000/-. Application made beyond 8 years for regularization purpose, shall also be considered by RA concerned, with an additional late fee of Rs. 5000/- for each year per authorization. This fee is in addition to the composition fee that may be payable on account of shortfall in export obligation. However, EO extension, beyond 8 years from date of issue of authorization, shall not be allowed by RA under this provision. 

5. Maintenance of Annual Average Export Obligation (para 5.19A)

The excess exports done towards the average export obligation fulfillment of an EPCG authorization during a year can be used to offset any shortfall in the Average EO done in other year(s) of the EO period or the block period as the case may be, provided Average EO imposed is maintained on an overall basis, within the EO period.

6. Export Obligation Discharge Certificate (para 5.22)

Authorization holder shall apply for EODC in ANF 5B with documents prescribed as a proof of EO fulfillment. On being satisfied, RA concerned shall issue EODC to the Authorization holder and a copy will be forwarded to ICEGATE through online for further action by Jurisdictional customs authorities with whom BG/LUT has been executed. Where EODC is granted to the EPCG authorization holder based on online application, a copy of EODC will be forwarded online to Jurisdictional customs authorities with whom BG/LUT has been executed

7. Regularization of Bonafide Default and Exit from EPCG Scheme(para 5.23)

In case, EPCG authorization holder fails to fulfill prescribed export obligation, he shall pay customs duty/ taxes/ cess along with applicable interest as prescribed by Customs Authority. Such facility can also be availed by EPCG holder to exit at his option.

Learn more about EPCG scheme