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Friday, January 17, 2014

Status Holders Incentive Scrip (SHIS) benefit for exporters

Under Foreign Trade Policy para no.3.16,with an objective to promote investment in upgradation of technology of some specified sectors the direct exports achieved by the business entity in the FY 2010-11, 11-12 and 12-13 qualify for the 1% Status Holders Incentive Scrip on the total direct exports for the three financial years.  This benefit is not available if there are any benefits availed under Zero % EPCG scheme in that year. Exporters can obtain Status Holders Incentive Scrips at 1% of the FOB value  of the exports. This scrip can be utilized for payment of excise duty for procurement of capital goods. This scrip can also be used for payment of import duty for import of capital goods. The application is to be made to DGFT to get this benefit. After verification of the application the authority  will issue the scrip. The scrip is valid for 18 months from the date of issue. The buyer can take the cenvat credit of duties which are paid through Scrip.

For Status Holders Incentive Scrip, the following exports categories /sectors shall be ineligible:
(i) EOUs / EHTPs / BTPs who are availing direct tax benefits / exemption;
(ii) Export of imported goods covered under Para 2 .35 of FTP;
(iii) Exports through transshipment, meaning thereby that exports originating in third country but transshipped through India;
(iv) Deemed Exports;
(v) Exports made by SEZ units or SEZ products exported through DTA units; and

(vi) Items, which are restricted or prohibited for export under Schedule-2 of Export Policy in ITC (HS).

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