The Government is making constant attempts for the promotion of India in the form of a global manufacturing hub and also to fulfill its commitment towards ease of doing business. The Central Board of Indirect Taxes (CBIC) has also taken an initiative of achieving the same goals, so it is providing the facility of allowing the Import of Raw Materials and Capital Goods without the Payment of Import Duty for manufacturing and other kinds of operations which are taking place in a Bonded-Manufacturing facility.
In this scheme, the import duty on the raw materials or capital goods gets deferred and is only payable when the finished goods get cleared to the domestic market, and the amount is payable on the imported raw materials used in production. The import duty on capital goods becomes payable when the capital goods get cleared to the domestic market. And when the imported inputs are utilised for exports, the deferred duty becomes exempted.
What are the Benefits of this Scheme:-
- No Geographical Restriction on Operations- New manufacturing facility can be set up or an existing facility can be converted into a bonded manufacturing facility irrespective of its location in India.
- Warehouse to Warehouse Transfer Permissable- The duty-free transfer of goods is allowed from one warehouse to another warehouse.
- Single Point of Approval- All the forms and documents are submitted to Commissioner of Customs and from there only all the approvals are made and the permissions are granted.
- Unlimited Warehousing Period- Both the raw materials and capital goods can be kept at warehouse for any amount of time until the goods are utilized or their clearance is completed.
- No Fixed Exports obligations- There is no limit provision is made for the clearance of finished goods that are going to the domestic markets. Any Manufacturing entity in a bonded facility may sell up to 100% of the output in the domestic market.
- Easy Compliance- All the detailed records related to manufacturing of goods or its warehousing and transportation is kept in single format according to Annexure B digitally.
- Deferred duty on imported capital goods- The import duty payable on Capital Goods used in manufacturing or other operations gets delay until there is clearance from the bonded facility. The deferred duty on capital goods is waived-off if they are used for exports.
- Deferred duty on imported raw materials- The import duty payable on Raw Materials used in manufacturing or other operations gets delay until the clearance of finished goods. The deferred duty on raw materials is waived-off if the finished goods get exported.
This scheme is also introduced to promote the AatmaNirbhar Bharat campaign of the government which is trying to motivate the businessmen to come forward and start manufacturing in India to make it a self-sufficient nation and to project it also as a global manufacturing hub.
With Warm Regards,
CL Bureau.
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