DEEMED EXPORTS

What is the meaning of Deemed Exports?
What are the different categories of supplies regarded as ‘DEEMED EXPORTS’?
What  are the benefits available under ‘Deemed Exports’?
What is the procedure for claiming the benefits of ‘DEEMED EXPORTS’?

 

 

Q1.         What is the meaning of Deemed Exports?

 

A.           ‘Deemed Exports’ as defined in the Export and Import Polilcy, 1997-2002 means those transactions in which the goods supplied do not leave the country and the supplier in India receives the payment for the goods.  It means the goods supplied need not go out of India to treat them as ‘Deemed Export’.

 

 

 

 

 

 

 

 

 

Q2.         What are the different categories of supplies regarded as ‘DEEMED EXPORTS’?

 

A.            The following categories of supply of goods manufactured in India shall be regarded as “deemed Exports” under the Export and Import Policy 1997- 2002.

                

a).    Supply of goods against licenses issued under the Duty exemption Scheme:

 

b)     Supply of goods to Units located in Export Processing Zones (EPZs) or Software Technology Parks (STPs) or Electronic Hardware Technology Parks (EHTPs) or

                Export Oriented Units (EOUs)

 

c)       Supply of Capital goods to holders of licenses issued under the Export Promotion Capital Goods (EPCG) Scheme;

 

d)       Supply of goods to Projects financed by Multilateral or Bilateral agencies/funds as notified by the Department of Economic Affairs, Ministry of Finance under international competitive bidding or under limited tender system in accordance with the procedure of those agencies/funds, where the legal agreements provide for tender evaluation without including the Customs duty

e)       Supply of capital goods and spares to fertilizer plants if the supply is made under the procedure of international competitive bidding.

f)        Supply of goods to any Project or purpose in respect of which the Ministry of Finance, by; a notification permits the import of such goods at zero customs duty coupled with the extension of benefits to domestic supplies;

 

g)       Supply of goods to such projects in the Power, Oil and Gas sectors in respect of which the Ministry of Finance, by Notification, extends the benefits to domestic supplies.

 

h)       Supply of Marine Freight Containers by 100% EOU (Domestic freight containers-manufacturers) to shipping companies including Shipping Corporation of India provided the said containers are exported out of India  within 6 months or such further period as permitted by customs.

 

 

 

 

 

 

 

 

Q3.         What are the benefits available under ‘Deemed Exports’?

 

A             Deemed Exports shall be eligible for the following benefits in respect of manufacture and supply of goods qualifying as Deemed Exports:


 

a) Special Imp rest Licence/Advance Intermediate License;.

 

b) Deemed Exports Drawback Scheme i.e, on the Deemed Exports, Drawback at the rate fixed by the Ministry of Finance for the DGFT or his regional Officers pay the goods physically exported.

 

c) Refund of terminal excise duty ie., Central Excise duty, if paid any, on the goods supplied under Deemed Exports is refunded by the DGFT or his regional Officers

 

d) ‘Special Import License’ at the rate of 6 per cent of the FOB value (excluding all taxes and levies)

 

e) If the supplier has made the supplies against Advance Release Order(ARO) or Back to Back Letter of Credit, he shall be entitled for the benefits of Deemed Exports Drawback Scheme, Refund or terminal excise duty and Special Imprest License

f) In respect of supply of capital goods to EPCG license holder, the supplier shall be entitled to the benefits stated above except, however, that the benefit of Special Imprest License or Deemed Export Drawback Scheme shall be available only in case of supplies made  to Zero duty EPCG license holder.    

   

Q4.          What is the procedure for claiming the benefits of ‘DEEMED EXPORTS’?

 

A.            The Suppliers of the goods under ‘Deemed Exports’ should make application to the regional licensing authority concerned claiming the benefits of ‘Deemed Exports’. The applications should be made in the forms given in Appendix 17 of ‘Hand Book of Procedure’s of export and Import Policy, 1997-2002. along-with documents prescribed therein.