Changes in Union Budget 2021-22 – Duty Free Import Scheme

No. CLE-HO/POL/CIRCULAR/2021

March 31, 2021

Members of the Council

Sub : Changes in Union Budget 2021-22 – Duty Free Import Scheme

Dear Member

You are aware that the duty free import scheme is currently implemented as per provisions of serial nos. 288, 311 and 312 of Customs Notification No. 50/2017 dated 30.6.2017 and this scheme provides Basic Customs Duty exemption for import of notified critical inputs to the tune of 3% of FOB value of exports in previous year for leather garment exporters and 5% of FOB value of exports in previous years for manufacturer exporters of footwear and other leather products. In respect of leather garments exporters, aforesaid S. No. 288 provides Basic Customs Duty exemption of 2% of FOB value of previous year for import of lining and interlining materials.

We would like to inform you that in the Union Budget 2021-22 presented on February 1, 2021, provisions of the said Serial Nos. 311 and 312 of Duty Free Import Scheme have been removed w.e.f. April 1, 2021 vide Serial No. 34 of Customs Notification No. 2/2021 dated 1.2.2021 (copy enclosed) .

From April 1, 2021 onwards the provisions of Serial No. 288 of Customs Notification No. 50/2017 dated 30.6.2017 alone will apply, as per which Basic Customs duty exemption is provided for import of lining and interlining materials by Leather Garments exporters, upto 2% of FOB value of exports in previous year. The procedure for availing this facility is enclosed.

We would like to inform you that CLE submitted various representations to the Government, requesting continuation of the Duty Free Import Scheme as per provisions of Serial No. 311 and 312 of Customs Notification No. 50/2017. CLE had also requested the Government to extend the validity of Export Performance Certificate of 2019-20 till Sept. 30, 2021. However, these requests have not yet been considered. Members may kindly note the above. The circular towards import of lining and interlining materials under DFIS for the year 2021-22 by leather garments exporters is enclosed.

Thanks and regards

R. Selvam IAS
Executive Director
COUNCIL FOR LEATHER EXPORTS