What is BG waiver?

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What is BG waiver?

The Bank guarantees exemption given on the basis of certain criteria such as – achievement of a certain level of export performance, Payment of duty, or having export house certification issued from DGFT.

How do I fulfill export obligation under EPCG?

Under Specific export obligation, an exporter has to export goods equal to 6 times of the actual duty saved amount within 6 years starting from the EPCG license issue date.

How do I claim my EPCG?

To avail of the benefits of the EPCG License, the exporter has to file an application with the DGFT. To apply for this incentive, fill up the Ayat Niryat Form 5B (ANF 5B) along with the following documents: Permanent Account Number (PAN) Digital Signature Certificate.

What is bank guarantee in export?

A bank guarantee is a written contract given by a bank on the behalf of a customer. By issuing this guarantee, a bank takes responsibility for payment of a sum of money in case, if it is not paid by the customer on whose behalf the guarantee has been issued.

How does EPCG scheme work?

EPCG scheme covers manufacturer exporters with or without supporting manufacturer(s), merchant exporters tied to supporting manufacturer(s) and service providers. To apply for an EPCG scheme, an IEC is required.

What is invalidation letter under EPCG?

EPCG scheme and Invalidation facility As per GST Law, invalidation facility is available on EPCG schemes, but applicable GST would need to be paid while making local procurement, using an invalidation letter. Input Tax Credit (ITC) of the GST paid on such local procurement can be availed as per CGST Rules 2017.

Who are eligible for EPCG?

Manufacturer exporters with or without supporting manufacturer(s), merchant exporters tied to supporting manufacturer(s) and service providers are eligible under the EPCG scheme. EPCG scheme also covers Common Service Provider (CSP).

What is bank guarantee in import?

Bank guarantee is the guarantee by bank assuring to pay the amount mentioned in the document, if any default by his (Bank’s) customer (you-importer). Normally bank reserves a bank guarantee margin amount from your account while issuing bank guarantee.

How do you guarantee a payment?

5 Steps To Guarantee Client Payment

  1. Use a Contract. If you do nothing else: write a legally binding contract for you and the client to sign.
  2. Demand a Deposit. Always demand an up-front deposit.
  3. Contact the Right People.
  4. Use a “Work Acceptance” Document.
  5. Withhold Launch Until the Final Payment.

What is bank guarantee with example?

Examples of Bank Guarantees A credit security bond serves as collateral for repaying a loan. A rental guarantee serves as collateral for rental agreement payments. A confirmed payment order is an irrevocable obligation where the bank pays the beneficiary a set amount on a given date on the client’s behalf.

What is the benefit of EPCG scheme?

Export Promotion Capital Goods (EPCG) License, as the name suggests, is intended to act as a stimulus for exports. It allows import of capital goods at 3% Customs Duty subject to the condition that an Export Obligation of eight times the duty saved is to be fulfilled within 8 years of Authorization issue date.

What is EPCG authorization?

The objective of the Export Promotion Capital Goods (EPCG) Scheme is to facilitate import of capital goods for producing quality goods and services and enhance India’s manufacturing competitiveness. EPCG Scheme allows import of capital goods for pre-production, production and post-production at zero customs duty.

Why is EPCG important?

The main benefit of the EPCG Scheme is importing capital goods with zero customs duty. Benefits under EPCG Scheme can be applied by any Exporter irrespective of his turnover. EPCG License can be issued to the following category of Exporters: Manufacturer Exporter.

What is the procedure of bank guarantee?

Understand the Process of Bank Guarantee First, an applicant will ask for a loan from a beneficiary or creditor. While applying for the loan, these 2 parties will agree that a bank guarantee is necessary. Then, the applicant will request a bank to provide a bank guarantee for the loan taken from the creditor.

What documents are required for bank guarantee?

Documents Required for a Bank Guarantee

  • An application form.
  • A bank guarantee letter.
  • A Stamp paper (as per the State Stamp Act)
  • A resolution passed by the board of members in case of a public/private limited company.
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