CA Varun Vijaywargi, Advocate Sejal Parashar Kher and
others at the meeting.
Business Bureau :
A GROUP discussion on ‘Bonded Manufacturing Scheme’ was recently organised between CA Varun Vijaywargi, Advocate Sejal Parashar Kher and others concerned to discuss the future of incentives offered to exporters and its governance. CA Vijaywargi said, “The Bonded Manufacturing Scheme is a complete package loaded with incentives. The scheme is not intended solely for exporters and as clarified by the Government, even a unit selling 100% production in domestic market can benefit from the scheme.
It would be suitable not only for companies engaged in export but also for companies domestically supplying goods that are manufactured or assembled using imported inputs.” He said, “The Bonded Manufacturing Scheme is beneficial for businesses which supply goods domestically and internationally after performing other operations like packaging, labelling and repackaging on such imported goods.” CA Vijaywargi said, “Through the Bonded Manufacturing Scheme, Government is fulfilling two primary objectives of promoting ‘Make in India’ and ease of doing business. The Bonded Manufacturing Scheme is a complete package offering and is likely to surpass the existing schemes under the Foreign Trade Policy (FTP).”
Every business would be compelled to assess whether opting for the older schemes gives any added benefit when compared with the Bonded Manufacturing Scheme which prima facie appears to be procedurally less cumbersome and comes with almost no strings attached, he further added. Speaking about the Bonded Manufacturing Scheme, Advocate Sejal Parashar Kher said that, “Fundamentally, it is a duty deferment scheme whereby an importer manufacturer can postpone the payment of import duties on capital goods as well as any inputs/ raw material as opposed to upfront payment required at the time of import.
This benefit alone is extremely incentivising as it helps save on working capital requirements of a company. Even the existing manufacturing units can be converted to bonded warehouses to avail the benefit of the scheme.” She further said, “The Bonded Manufacturing Scheme is packed with various incentives including waiver of interest on payment of deferred duty (in most cases), no requirement of being present in any specific geographical region or zone such a SEZ or FTWZ, no export obligation, no actual user condition, no value addition requirement, no positive NFE requirement which is typically associated with schemes like EPCG and Advance Authorisation. The procedure for opting for the scheme has also been simplified by Government and now requires a single integrated application with no application fee or periodic renewal.”