{"id":6784,"date":"2025-11-14T08:50:11","date_gmt":"2025-11-14T03:20:11","guid":{"rendered":"https:\/\/www.centaxonline.com\/blog\/?p=6784"},"modified":"2025-11-14T08:50:11","modified_gmt":"2025-11-14T03:20:11","slug":"dgft-clarifies-redemption-of-advance-authorisations-affected-by-rule-9610","status":"publish","type":"post","link":"https:\/\/www.centaxonline.com\/blog\/dgft-clarifies-redemption-of-advance-authorisations-affected-by-rule-9610","title":{"rendered":"DGFT Clarifies Redemption of Advance Authorisations Affected by Rule 96(10)"},"content":{"rendered":"

Policy Circular No. 07\/2025-26<\/a>, Dated 11-11-2025<\/p>\n

1. Background<\/h2>\n

The Directorate General of Foreign Trade (DGFT)<\/strong> has issued a Policy Circular<\/strong> providing clarity on the procedure for redemption of Advance Authorisations<\/strong> impacted by the erstwhile Rule 96(10) of the Central Goods and Services Tax (CGST) Rules, 2017<\/strong>.<\/p>\n

The clarification pertains to imports made between 13 October 2017 and 9 January 2019<\/strong>, a period during which exporters faced procedural challenges due to restrictions on refund of IGST for certain duty-exempt imports.<\/p>\n

2. Context \u2013<\/span> Restrictions and Pre-import Conditions<\/h2>\n

During the specified period:<\/p>\n

    \n
  • Rule 96(10)<\/strong> restricted the refund of IGST on exports<\/strong> when duty exemptions under certain schemes, including Advance Authorisation<\/strong>, were availed.<\/li>\n
  • The pre-import condition<\/strong> was introduced through earlier notifications, mandating that inputs be imported prior to export to avail IGST and Compensation Cess exemptions<\/strong> under the Advance Authorisation Scheme.<\/li>\n
  • This condition was subsequently withdrawn<\/strong>, leading to ambiguity in the redemption process for affected authorisations.<\/li>\n<\/ul>\n

    3. Purpose of the Circular<\/h2>\n

    The DGFT circular seeks to:<\/p>\n

      \n
    • Resolve difficulties faced by exporters<\/strong> in obtaining redemption of authorisations during this transitional period, and<\/li>\n
    • Ensure a consistent approach<\/strong> across regional authorities for processing such cases.<\/li>\n<\/ul>\n

      4. Clarification Provided<\/h2>\n

      The circular clearly states that Export Obligation Discharge Certificates (EODCs)<\/strong> shall not be withheld<\/strong> if the following conditions are satisfied:<\/p>\n

        \n
      1. IGST was paid in cash<\/strong> at the time of import;<\/li>\n
      2. No exemption<\/strong> from IGST, Compensation Cess, or any other levies (except Basic Customs Duty) was availed; and<\/li>\n
      3. The applicant complied with the prescribed pre-import and procedural requirements<\/strong> under the Advance Authorisation Scheme.<\/li>\n<\/ol>\n

        5. Significance<\/h2>\n

        This clarification provides long-awaited relief to exporters whose authorisations were pending redemption due to technical restrictions under the erstwhile Rule 96(10).<\/p>\n

        It reinforces DGFT\u2019s intent to streamline trade facilitation<\/strong>, ensure regulatory certainty<\/strong>, and support exporters\u2019 compliance continuity<\/strong> under the Foreign Trade Policy framework.<\/p>\n","protected":false},"excerpt":{"rendered":"

        Policy Circular No. 07\/2025-26, Dated 11-11-2025 1. Background The Directorate General of…<\/p>\n","protected":false},"author":8,"featured_media":6786,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[52,181,54],"tags":[],"class_list":["post-6784","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-foreign-trade-policy","category-news-foreign-trade-policy","category-ftp-statutory-scope"],"yoast_head":"\nDGFT Clarifies Redemption of Advance Authorisations Affected by Rule 96(10)<\/title>\n<meta name=\"description\" content=\"DGFT issues guidance allowing EODC redemption for AAs impacted by Rule 96(10) (Oct 2017\u2013Jan 2019) where IGST was paid in cash and no IGST exemption was availed.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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