Govt. issues Guidelines for RoDTEP Scheme [Read Notification]

Guidelines for RoDTEP Scheme - Taxscan

The government notified the Scheme for the remission of duties and taxes on exported products (RoDTEP).

The Scheme’s objective is to refund, currently un-refunded Duties/taxes/levies, at the Central, State, and local level, borne on the exported product, including prior stage cumulative indirect taxes on goods and services used in the production of the exported product and Such indirect Duties/ taxes/ levies in respect of the distribution of the exported product.

The rebate under the Scheme shall not be available in respect of duties and taxes already exempted or remitted or credited.

The determination of ceiling rates under the Scheme will be done by a Committee in the Department of Revenue/Drawback Division with the suitable representation of the DoC/DGFT, line ministries, and experts, on the sectors prioritized by the Department of Commerce and Department of Revenue.

The overall budget/outlay for the RoDTEP Scheme would be finalized by the Ministry of Finance in consultation with the Department of Commerce (DoC), taking into account all relevant factors.

“The Scheme will operate in a Budgetary framework for each financial year and necessary calibrations and revisions shall be made to the Scheme benefits, as and when required, so that the projected remissions for each financial year are managed within the approved Budget of the Scheme. No provision for remission of arrears or contingent liabilities is permissible under the Scheme to be carried over to the next financial year,” the Ministry of Commerce and Industry in the notification said.

The sequence of introduction of the Scheme across sectors, prioritization of the sectors to be covered, degree of benefit to be given on various items within the rates set by the Committee and within a ceiling as may be prescribed, on the per-item/total overall benefit amount permissible, within the overall budget/ outlay finalized, will be decided and notified by the Department of Commerce (DoC) in consultation with Department of Revenue.

The Scheme would be implemented through end-to-end digitization of issuance of rebate amount in the form of a transferable duty credit/electronic scrip (e-scrip), which will be maintained in an electronic ledger by the Central Board of Indirect Taxes & Customs (CBIC). Necessary rules and procedures regarding grant of RoDTEP claim under the Scheme and implementation issues including the manner of application, time period for application, and other matters including export realization, export documentation, sampling procedures, record keeping, etc. would be notified by the CBIC, Department of Revenue on an IT-enabled platform with a view to ending digitization. Necessary provisions for recovery of rebate amount where foreign exchange is not realized, suspension/withholding of RoDTEP in case of frauds and misuse, as well as the imposition of penalty will also be built suitably by CBIC, the government added.

For the purposes of audit and verification, the exporter would be required to keep records substantiating claims made under the Scheme. A monitoring and audit mechanism with an IT-based Risk Management System (RMS) would be put in place by the CBIC, Department of Revenue to physically verify the records of the exporters on a sample basis. Sample cases for physical verification will be drawn objectively by the RMS, based on risk and other relevant parameters.

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