The Rebate of State and the Central Taxes and Levies on Exports of Garments and made-ups were brought to assist the local textile and apparel related Small and Medium Enterprises(SMEs). Based on this, the textile exporters can claim refunds on central, state, and local levies by using this beneficial scheme. The rebate under this scheme shall be in duty credit-free scrips format.

What is the meaning of the RoSCTL Scheme?

The scheme of RoSCTL was introduced by the Ministry of Textiles basically for the purpose of export of apparel and textiles to increase competitiveness. It was introduced during the pandemic time that is in the month of March 2019, basically with the purpose of encouraging the textile sectors during the pandemic. It was further extended up to 2024 with the assistance of the Apparel Export Promotion Council (APEC).

This Scheme was introduced in place of the Rebate of State Levies (RoSL) and the Merchandise Exports from India Scheme. This scheme is executed by the Revenue Department which basically acts as a tool to compensate your business for Central Taxes, State Taxes, and levies by the sellable and transferable duty credit scrips.

Advantages of the RoSCTL Scheme

There are a lot of benefits of the RoSCTL Scheme, all the major benefits are mentioned below-

  • It provides monetary assistance to exporters and enhances the competitiveness of their manufactured products, thus making a presence in the global market.
  • This Scheme also plays a big role in reducing manufacturing costs through refunding the taxes levied on the exported goods/products which also benefits the end consumer as he can avail at a lower prices.
  • This helps to increase the visibility of the Indian Products in the Global Market and enhances its overall demand.
  • The benefit can be availed by any Indian exporter who manufactures certain types of goods.
  • The products that come under this scheme are- apparel, leather, footwear, handicraft, marine and engineering products.
  • It is to be noted that this scheme is applicable to all those products manufactured in the Special Economic Zones(SEZ).

What is the Process for applying for the RoSCTL Scheme?

The following steps are to be followed when applying for the RoSCTL Scheme-

Step 1- The Applicant first needs to fill the ANF-4-R form on the official website of DGFT, 50 shipping bills can be used in a single application.

Step 2- After filling out the application form and submitting all the bills, the applicant needs to register for RoSCTL scripts. It is important to follow a few guidelines-

  • The Registration for the Ports for the Electronic Data Interchange needs to be chosen from any of the ports where the exports have been conducted.
  • The shipment process is different for both EDI and non-EDI ports.

Step 3- After Submitting the application, it will be electronically approved by the DGFT and it also includes the ad-hoc incentives.

Step 4- The Script will be issued after the final approval of the entitlement by the Regional Authority (RA) via electronic mode.

Documents Required for RoSCTL Scheme?

The Following Documents are required to apply for the RoSCTL Scheme-

    • Digital Signature Certificate
    • Shipping Bill
    • DGFT Registration

What is Duty Credit Scrip?

The Duty Credit Scrip is introduced for the purpose of rebate under the RoSCTL scheme. The mode of generation is via electronic mode on the customs system, it should be used for the basic payment purpose of customs duty on the imported goods, which are also transferable in nature.

It shall be transferred at a time for the entire amount in e-scrip to the other person and transfer of credit duty, it is to be noted that transfer of duty credit in parts will not be allowed.

It is usually valid for one year from the date of its creation and shall not change on account of transfer of the e–scrip.

Rebates Under the RoSCTL Scheme?

The General rebates under the RoSCTL Scheme  are provided below- 

  • State Level Taxes and Levies Claim- Captive Power, Mandi Tax, Stamp Duty on export documents, purchase from unregistered dealers, stamp duty on export documents, VAT on Fuel Transportation, SGST on inputs such as fertilizers and pesticides, Coal used for production, material utilized in the transport sector, Duty on electricity.
  • Central Level Taxes and Levies Claim- Embedded CGST on inputs, purchase from unregistered dealers, CGST and Compensation Cess on Coal used in production of electricity, input for transport sector, central excise duty on fuel used in transportation.

Restricted Goods on Rebate Under the RoSCTL Scheme?

  • Those Goods come under the minimum export price.
  • Deemed exports under the Foreign Trade Policy.
  • The Exports of Imported Goods.
  • Trans-shipment through the country.
  • Those Goods which are restricted for Exports.
  • IEC is listed in the Denied Entry List by the Director General of Foreign Trade.
  •  Goods manufactured under section 65 of the Customs Act, 1962.
  • Goods which are produced by units of Domestic Tariffs Area in a special economic zone.
  • Goods that have been used after the manufacture or reconditioned goods.
  • The un-recorded duty claim of a product.
  • Those products are manufactured or produced or licensed as a hundred percent export.
  • Those Goods that are produced or manufactured by units located in the Special Economic Zone, warehousing or export processing zone.

Conclusion

It can be concluded that the scheme of RoSCTL has helped the Indian Exporters a lot in a global context, it has increased the overall profit margins and the accessibility to markets. This scheme has played a very significant role in encouraging the Indian Textile and apparel sector, contributing to the overall economic growth and enhancing exports from India. Though it may sound tempting, the exporters may need to take a few precautions, for example, the exporters who get the benefits from the RoCSTL scheme need to retain the proof of the receipts of sale proceeds. Professional Utilities Consists of leading consultants and experts for the RoSCTL scheme, book a consultation with us to know more.

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