Chatroom: EODC not necessary for selling goods made from duty-free inputs

Understanding export-obligation timelines, currency-correction relief, and anti-dumping duty exemptions for EOUs

Para 4.16 of FTP says that “advance authorisation and/or material imported under advance authorisation shall be subject to ‘Actual User’ condition. The same shall not be transferable even after completion of export obligation. However, Authorisation holder will have option to dispose of product manufactured out of duty-free input once export obligation is completed”. Our question is whether we must wait till EODC is granted before selling goods manufactured from duty free inputs imported under advance authorisation? 

I don’t think so. If the intention of the government was to make you wait till EODC is issued, the same would have been stated clearly, as in the case of EPCG scheme, where Para 5.03 of FTP clearly says that ‘imported capital goods shall be subject to Actual User condition till export obligation is completed and Export Obligation Discharge Certificate (EODC) is granted’. In the absence of such a clear stipulation at the said Para 4.16, you may yourself take a call, without waiting for the EODC to be issued, on whether you have fulfilled the export obligation by exporting the requisite quantity of export product and achieving the prescribed value addition

 

We refer to RBI’s AP(DIR) Circular no.12 dated 1st October 2025 which, besides other matters, says that for closure of the EDPMS/IDPMS entries up to the equivalent of ~10 lakhs, the AD banks can accept any reduction in declared value or invoice value of the shipping bills/bills of entry based on the declaration by the concerned exporter or importer. Can we use this provision to regularise a matter where, by mistake, we had mentioned the currency as Euro in the shipping bill instead of mentioning US dollar? 

Yes. I think the said relaxation is mainly intended to help exporters and importers to close such EDPMS/IDPMS entries where some mistake is made while filing the bill of entry and/or shipping bill, without having to go through the arduous task of getting the shipping bill or bill of entry amended.  So, you can give a declaration stating that the value in the shipping bill should read US$ instead of Euro and get the outstanding entry reconciled. 

We are an EOU. One of the raw materials we want to import attracts anti-dumping duty. The exemption notification no.52/2003-Cus dated 31st March 2003 under which we import our requirements duty free grants exemption of only the BCD and additional duties under Sections 3(1), 3(3), 3(5), 3(7) and 3(9) of the Customs Tariff Act, 1975 but not for anti-dumping duties levied under Section 9A of the said Act. Are we liable to pay the anti-dumping duty? 

No. Section 9A (2A) of the Customs Tariff Act, 1975 says, in effect, that any notification imposing anti-dumping duty shall not apply to articles imported by an EOU or a SEZ unit unless, it is specifically made applicable in the notification or such article is either cleared as such into the DTA or used in the manufacture of any goods that are cleared into DTA.

 

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