Under this scheme, a domestic manufacturer can import machinery and plant without payment of customs duty or at a concessional rate of customs duty. 8 Nil incase CIF value is Rs50mn or more for agriculture, aquaculture, animal husbandry, floriculture, horticulture, poultry and sericulture. Time is in years. The exporter can also procure such machinery from India with payment of duty or at concessional rate of duty. Similarly, he can obtain goods from the domestic market without excise duty.
Production has to be under the supervision of the customs or excise authority.
An exporter is entitled to claim drawback or refund of excise and customs duties paid by his suppliers. Drawback on material used for manufacturer of export products can be claimed by the final exporter. Rules have been framed for the purpose allowing drawback. Drawback is allowed even in respect of goods, which are re imported. No drawback is allowed on inputs obtained without payment of customs or excise duty.