The authorities may check the application to examine whether prima facie, the services exported are eligible for the benefits, and for any other obvious errors in the application and the Chartered Accountant Certificate. Besides, as per Para 3.19 of the FTP and Para 3.17of the HBP, 10 per cent of the scrips issued every month will be selected for scrutiny. The authorities can call for the original physical documents for examination in detail. If they find any discrepancies or deficiencies, the applicant will be asked to rectify them. In case of excess availment of rewards, the applicant will be asked to refund the excess claim with interest, in accordance with Para 3.19 of the FTP.
In order to incur a reduced export obligation under the EPCG scheme, we propose to pay IGST on imports of capital goods? Is it allowed?
Yes, provided you do not take input tax credit of the IGST
paid. As per Para 5.01(d) of the FTP, “in case Integrated Tax and Compensation Cess are paid in cash on imports under EPCG, incidence of the said Integrated Tax and Compensation Cess would not be taken for computation of net duty saved provided Input Tax Credit is not availed”.
We want to re-export imported goods found defective. As we had not paid the foreign supplier, we had obtained GR waiver from the bank. Can we get drawback of 98 per cent of the duties paid?
Yes, provided you comply with the conditions specified under Section 74 of the Customs Act, 1962 read with Re-export of Imported Goods (Drawback of Customs Duties) Rules, 1995. Under the relevant provisions, there is no condition that you must realise the export proceeds.