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Project Import Scheme

PROJECT IMPORT SCHEME

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    PROJECT IMPORT SCHEME

    Apply for Project Import Scheme with our experts

    get started!

      6000 +
      Business served
      9.6/10
      Customer Ratings
      100 %
      Satisfaction

      What is PROJECT IMPORT Scheme?

      Project imports means import of plant and machinery for initial set up or substantial expansion of an existing project established in India. All goods imported under Project Import Scheme are enveloped under a Single Classification falling under Chapter 98 of ITC HS Code and are levied with a single rate of duty instead of merit assessment of imported items.

      Benefits of Project Import Scheme:

      Assessment under one heading i.e., Chapter 98 of ITC HS Codes:

      This removes all possibilities of disputes with customs regarding tariff classification

      Eligible EPCG Benefits:

      Capital Goods imported under Project Import Scheme can be imported duty free against an EPCG Authorization.

      Concessional Duty:

      Effective Duties under Project Import Scheme depends on the type of project and are generally lower than the normal rates. All items covered under Project Import Scheme attract a constant 5% Basic Customs duty (BCD). Additionally, IGDT is leviable that brings the total applicable duty to 24.49% as against the normal total of 27.73% payable on Capital Goods alone. Thus, Project Import Scheme offers a saving of approximately 3.24%

      Eligibility Criteria and Procedure for Project Import Scheme:

      Projects under Project Import scheme should be permitted by the Ministry of Industry or any other concerned Administrative ministry to be qualified under the scheme.

      Additionally, the project is required to be registered with customs where most of the imports are to take place, along with the import license if relevant.

      Cash security along with Bank Guarantee/Bond needs to be offered, which gets cancelled/cashed in after conclusion of imports.

      EPCG if availed along with Project Import needs to be taken from the DGFT office.

      How will we help?

      We can help you in the following aspects for claiming Project Import Scheme benefits:
      Planning and Documentation
      We can help you in full planning, documentation, preparation, application, representation and coordination with the Ministry of Industry, Customs, DGFT, or any other relevant Government Departments for obtaining approval.
      Registering the project with Customs

      Upon receipt of approval, we can help you in obtaining the requisite customs registration.

      Redemption of the BG/Bonds

      Upon completion of Import we can assist in redemption of the Bank Guarantee (BG)/Bonds submitted at the customs.

      Obtaining EPCG

      We can help you with obtaining EPCG authorization for duty free imports of the capital goods under Project Import Scheme.

      Replying to Deficiency Letter and other queries

      We help you in post EPCG compliance by keeping a track of export performance and fulfilled export obligation.

      Frequently Asked Questions

      All you need to know before applying for Project Import Scheme:

      Project Imports Scheme is a concept, unique to Indian Customs, wherein all the goods imported to the setup of an Industrial Project or substantial expansion of existing industrial projects are subjected to single classification under Custom Tariff Act, 1975.

      The Project Import Scheme’s primary objective is to simplify the assessment of import of capital goods and all the related items required for setting up of a project by the levy of a flat rate of duty.

      To facilitate smooth and quick assessment by a simplified process of classification and valuation, the goods imported under the Project Import Scheme are placed under a single Tariff in the Customs Tariff Act, 1975. This scheme facilitates assessment and ensures faster clearances of goods.

      The essential requirements to be fulfilled for being eligible for concessional rate of duty under the project import scheme are as follows:

      • Goods should have been imported against a specified contract registered with the appropriate Customs House
      • Such registration should have been made in the manner prescribed by the regulations
      • Registration of the contract should have been obtained before the order (granting permission for clearance of the goods) was passed

      The goods are subjected to single classification under  Chapter 98 of the Custom Tariff Act, 1975.

      Under Projects Imports, the following goods are allowed to be imported at concessional rate of duty:

      • All items of machinery including
        • Prime movers
        • Instruments
        • Apparatus and appliances
        • Control gear and transmission equipment
      • Auxiliary equipment (required for research and development purposes, testing, and quality control
      • All components (whether finished or not) or raw materials for the manufacture of the aforementioned items and their components, required for the initial set up of a unit, or the substantial expansion of an existing unit
      • Spare parts, other raw materials. (Including semi-finished material) or consumable stores not exceeding 10% of the value of the goods specified above
      • Spare parts, raw materials, or consumable stores can be imported if these are essential for the maintenance of the plant or project

      A project will fall under the category of ‘substantial expansion’ if the installed capacity of the unit is increased by above 25%, as per the Project Import Regulations.

      Under the Scheme of Project Import, the following projects are covered:-

      • Industrial Plant
      • Irrigation Project
      • Power Project
      • Mining Project
      • Project for the exploration of oil or other minerals

      The benefit under the Scheme is not available to hotels, photographic studios, hospitals, photographic film processing laboratories, laundries, photocopying studios garages, and workshops. This benefit is also not available to a single or composite machine

      • As per the Project Imports Scheme, the construction equipment as auxiliary equipment can be imported only if it’s essentially required for initial setting up or substantial expansion of registered projects.
      • The construction equipment may be permitted to be transferred to another registered project, after completion of its intended use, on recommendations of sponsoring authority.

      Note: The ‘Plant Site Verification Certificate’ (PSVC) required to be submitted for finalization of the project

      The concessional rate of duty under the Project Import Scheme applies only to specified projects sponsored by specified sponsoring authorities with a detailed itemized list of goods. Under this scheme, the goods will only be imported after duly attested by the sponsoring authority and imported under specific contracts registered before the import of the goods.

      Visit this link to know more about the sponsoring authority specific to the projects.

       

      For availing the benefit of assessment under this scheme, the importer should have entered into one or more contacts with the suppliers of the goods for setting up a project.

      o expedite registration, the importers are needed to submit the following documents along with the application for registration

      • The original deed of contract together
      • Industrial Licence and letter of intent
      • SSI Certificate granted by the appropriate authority
      • Original Import license with a list of items showing the dimensions, specifications, quantity, quality, value of each item duly attested by the Licensing Authority
      • Recommendatory letter for duty concession from the concerned Sponsoring Authority,
      • Process flow chart, plant layout, drawings showing the arrangement of imported machines
      • Project Report submitted to the Sponsoring authorities, Financial Institution, etc
      • Continuity Bond with specified security. The said continuity Bond should be made out for an amount equal to the CIF value of the contract sought to be registered
      • Write up, drawings, catalogues, and literature of the items under import
      • Foreign collaboration agreement, technical agreement, basic/detailed engineering agreement

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