Dated 22nd August, 2019

 Recent Amendments in GST

Procedure for obtaining Additional MEIS - No Incentive Certificate for Re-import of Exported Goods


Retrospective change in meis rates – how to claim differential rate?

Merchant Exports from India Scheme (MEIS), is one of the export incentives granted to an exporter under Chapter 3 of the Foreign Trade Policy, 2015-2020 (FTP 15-20). Reward is available as per MEIS rates specified against each HS code.

During mid-term review of the Foreign Trade Policy (FTP 2015-20) various public notices1 were issued enhancing the MEIS rate on various HS codes. However, many of the exporters had already claimed the incentive as per old MEIS rate after duly realizing their export proceeds. So, in order to claim such differential rate of MEIS Trade Notice No. 28/2019-20, dated 05.08.2019 has been issued. The detailed procedure to claim such additional benefit is stated herein below:

Procedure for additional claim under MEIS:

  • Exporters will have to submit an application letter to the concerned regional authority along with the statement of shipping bills and respective file no. from which MEIS claim has already been issued.
  • Regional Authority would open supplementary file from same file no. in E-com module.
  • Regional Authority would check eligibility of the additional claims & fill differential rate for the HS code in the relevant field.
  • Only after approval from Deputy DGFT the Supplementary claim will be issued in paperless form.
  • Additional documents shall not be needed to be submitted after the submission of above application letter in (a) above.
  • Such scrips can be used just like other MEIS scrips.

Recovery of incentives granted under FTP 2015-20 in case of re-import of exported goods2

In case of Re-import of exported goods there was an impression as to the non existence of clear cut guidelines for recovery of incentives granted earlier at the time of export, under chapter 3 of the FTP 2015-20. In relation to this the DGFT has informed that there is a specific provision for recovery of such export benefits which is provided in RBI Master Direction3 on import & export. Further a no incentive certificate from regional authority of DGFT will be required to be obtained during such re-importation. So, while re-importation, the importer need to give no incentive certificate before clearance of such goods and such certificate will be ensured by the Customs department.

Supplementary cut @2% not applicable in the case of additional benefit4

To synchronize the admissibility of additional MEIS benefit due to retrospective enhancement of MEIS rate, necessary amendment has also been made in Handbook of procedures. Moreover, it is applicable for only those HS codes for which rates have increased retrospectively and it may also be noted that the supplementary cut @ 2% of the entitlement generally applicable in case of supplementary claims will not be applicable on such additional claims.

Conclusion

Based on the above context it can be concluded that the exporters under the MEIS have been provided the advantage of claiming additional benefits for certain HS codes for which rates has been increased and also supplementary cut is not applicable on such claims. But in case of re-import of exported goods on which benefits have been received, such benefits shall be recovered and a no incentive certificate will be needed compulsorily during such re-importation.

 1.  Public notice No.42 dt. 24/11/2017; Public notice -44 dt. 05/12/2017; Public notice -02 dt.01/05/2018; Public notice -28 dt.08/08/2018

 2  Instruction No. 03/2019-customs dated 13.08.2019.

 3  RBI Master Direction: F.No. RBI/2006-2007/313 A.P. (DIR Series) Circular No.37 dt. 05/04/2007

  4  Public Notice No. 23/2015-20 dated 05.08.2019


Recent Amendments in GST

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Recent Amendments in GST

Recent Amendments in GST
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Bhaskar Thakkar

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BT Associates, India

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Twenty years of exprience in tax practice, specialist in structuring & planing and tax optimization under indirect tax. Lead eastern India indirect tax practice of Ernst & Young in past.