We are a SSI unit manufacturing shawls and stoles. Our turnover is below Rs 4 crore in one unit and below Rs 1 crore in another unit. We consume laces and beads in the production process. So far we have been buying these items locally but now we propose to import these from China/Bangkok, etc. Our products do not attract excise duty. Very soon we shall be importing some machines as well. We want to know whether there is any exemption available to SSI units from payment of custom duty on imports of input materials or machines, and whether we can get any concession on rates of customs duty on imports of inputs or machines if we start exports directly.
No import duty concessions are available only because the importer is a SSI. For manufacture of goods for exports, you can get the required inputs (i.e. raw materials, components, consumables, etc) at zero duty under advance authorisation scheme under Chapter 4 of the Foreign Trade Policy and you can even import capital goods at zero duty under Export Promotion Capital Goods (EPCG) scheme under Chapter 5 of the Foreign Trade Policy. Besides, you have the option of claiming drawback at the notified All Industry Rates or drawback of the actual duty paid as per the Duty Drawback Rules and related notifications. Also, you can import duty paid capital goods and get remission of the basic duty of customs under the Post Export EPCG scheme.
Can we accept payment from a foreign buyer in cash or through a credit card, when he is on a visit to India? Can we accept payment for exports from the buyer's agent in India in rupees?
As per Par B.2 of RBI Master Circular no. 14/2012-13 dated 2nd July, 2013, the amount representing the full export value of the goods exported shall be received through an AD Bank through bank draft, pay order, banker's or personal cheques, foreign currency notes, foreign currency travellers' cheques from the buyer during his visit to India or payment out of funds held in the FCNR/NRE account maintained by the buyer or international credit cards of the buyer. When payment for goods sold to overseas buyers during their visits is received in this manner, GR/SDF (duplicate) should be released by the AD Category-I banks only on receipt of funds in their Nostro account, or if the AD Category-I bank concerned is not the credit card servicing bank, on production of a certificate by the exporter from the credit card servicing bank in India to the effect that it has received the equivalent amount in foreign exchange.
AD Category-I banks may also receive payment for exports made out of India by debit to the credit card of an importer where the reimbursement from the card issuing bank/organisation will be received in foreign exchange. Payment from local agent of the foreign buyer in Indian rupees is not an approved method for receiving payment for exports, as per current Regulations.
No import duty concessions are available only because the importer is a SSI. For manufacture of goods for exports, you can get the required inputs (i.e. raw materials, components, consumables, etc) at zero duty under advance authorisation scheme under Chapter 4 of the Foreign Trade Policy and you can even import capital goods at zero duty under Export Promotion Capital Goods (EPCG) scheme under Chapter 5 of the Foreign Trade Policy. Besides, you have the option of claiming drawback at the notified All Industry Rates or drawback of the actual duty paid as per the Duty Drawback Rules and related notifications. Also, you can import duty paid capital goods and get remission of the basic duty of customs under the Post Export EPCG scheme.
Can we accept payment from a foreign buyer in cash or through a credit card, when he is on a visit to India? Can we accept payment for exports from the buyer's agent in India in rupees?
As per Par B.2 of RBI Master Circular no. 14/2012-13 dated 2nd July, 2013, the amount representing the full export value of the goods exported shall be received through an AD Bank through bank draft, pay order, banker's or personal cheques, foreign currency notes, foreign currency travellers' cheques from the buyer during his visit to India or payment out of funds held in the FCNR/NRE account maintained by the buyer or international credit cards of the buyer. When payment for goods sold to overseas buyers during their visits is received in this manner, GR/SDF (duplicate) should be released by the AD Category-I banks only on receipt of funds in their Nostro account, or if the AD Category-I bank concerned is not the credit card servicing bank, on production of a certificate by the exporter from the credit card servicing bank in India to the effect that it has received the equivalent amount in foreign exchange.
AD Category-I banks may also receive payment for exports made out of India by debit to the credit card of an importer where the reimbursement from the card issuing bank/organisation will be received in foreign exchange. Payment from local agent of the foreign buyer in Indian rupees is not an approved method for receiving payment for exports, as per current Regulations.
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