17 September 2021
Government notifies due date and validity period for scrip based FTP scheme

On 9 September 2021, the government vide a press release had announced a budget allocation of INR 560.27 billion in FY 2021-22 to disburse all pending export incentives (viz. MEIS, SEIS, RoSL, RoSCTL, RoDTEP). It was also clarified that this amount would be over and above the duty remission amount of INR 124.54 billion for the RoDTEP scheme and INR 69.46 billion for RoSCTL scheme already announced for exports made in FY 2021-22.

Now, vide Notification No. 26/2015-2020 dated 16 September 2021, the government has notified the last date for submitting applications for scrip based Foreign Trade Policy (FTP) Schemes and validity period of Duty Credit Scrips.

Due date for submission of applications

The government has notified 31 December 2021 as the due date for various scrip based FTP schemes captured below:
Scheme Period
Merchandise Exports from India Scheme (MEIS) For exports made in the period from 1 July 2018 to 31 December 2020
Service Exports from India Scheme (SEIS) For service exports rendered in financial years 2018-19 and 2019-20
2% additional ad hoc incentive (under para 3.25 of FTP - mobile phone exports) For exports made in the period 1 January 2020 to 31 March 2020
Rebate of State and Central Levies and Taxes (RoSCTL) - for textile sector For exports made in the period 7 March 2019 to 31 December 2020
Rebate of State Levies (RoSL) - for textile sector For exports made up to 6 March 2019 for which claims have not yet been disbursed under scrip mechanism

Revised late-cut provisions

The new late cut provisions for applications submitted up to 31 December 2021 have also been notified as follows:
Sr. No. Scheme Period of exports (Let export date in the period)/services rendered in the period Late Cut (as % age of entitlement under the scheme)
1 MEIS FY 2018-19 (1 July 2018 to 31 March 2019) 10%
2 MEIS FY 2019-20 and FY 2020-21 (up to 31 December 2020) Nil
3 SEIS FY 2018-19 5%
4 SEIS FY 2019-20 Nil
5 RoSCTL 7 March 2019 to 31 December 2020 Nil
6 RoSL Up to 6 March 2019 Nil

After 31 December 2021, no further applications would be allowed to be submitted, and they would become time-barred. Late cut provisions shall also not be available for submitting claims at a later date.

Validity period of scrips

The new validity period of a Duty Credit Scrip issued on or after 16 September 2021 shall be 12 months from the date of issue for all scrip-based Schemes under Chapter 3 and Chapter 4 of FTP 2015-20, as well as the earlier FTPs.
Our Comments
The clarity on eligibility of exporters to claim incentives for exports made since FY 2018-19 was much awaited. However, although the due date for submission is less than four months away, the online facility to make the applications is yet to be enabled. Furthermore, the SEIS incentive rates for FY 2019-20 have not been notified by the government till date. Therefore, exporters may face practical challenges in completing and submitting their applications in such a short time frame. The government should explore the possibility of extending the current due date of 31 December 2021 (with or without late cut) so that exporters get sufficient time to submit their applications.
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