Para 14.5.1 — CAM

14.5.1. PROCEDURE FOR ACCOUNTING OF ISSUE AND UTILIZATION OF SCRIPS TOWARDS PAYMENT OF CUSTOMS DUTY

14.5.1.1 The Govt. of India has been providing rebates on taxes paid and incentives to Exporters under various schemes like RoDTEP (Remission of Duties and Taxes on Exported Products), RoSCTL (Remission of State and Central Taxes and Levies), like MEIS (Merchandise exports from India Scheme), SEIS (Service Exports of India Scheme). The issue of scrips to exporters and its utilization had so far been treated only as revenue foregone. From Financial year 2021-22 onwards, however, the Government decided that there should be a budgetary control over the issue and discharge of scrips towards payment of Customs Duty. Accordingly, the Budget Division has provided an accounting process (as detailed below) to be followed in the budgetary route of issue of scrips and its discharge through the CFI and Public account.

(a) A suitable budget provision will be made annually under the new Minor Heads (opened for various schemes) below the Major Head “2037”, indicating the maximum amount up to which the scrips will be issued. Addition or reduction to the budget allocated will be made as per requirement as done for all expenditures.

(b) At the time of issue of scrips to the exporters, an amount equivalent to the scrips issued will be transferred from the concerned minor heads under ‘2037- Customs’ to Public Account, under relevant minor heads below the Major Head “8012- Special Deposits and Accounts”.

(c) As and when scrips are utilized for payment of Custom Duty, the Public Account will get debited and an equal amount credited under the concerned Minor Head relating to the liability on account of customs duty discharged below the Major Head “0037- Customs”.

(d) While calculating the net proceeds assignable to States, the entire cost of collection along with the amount booked under “MH 2037-Customs” towards issue of scrips will be deducted from total collection for arriving at the ‘Net Proceeds’ for the purpose of devolution of State’s share from Central Taxes.

(e) The scrips issued are valid for a period of one/ two year

(s) from the date of issue. On expiry of validity of unused scrip

(s) within the same year, the corresponding balance lying in the public account shall be credited back to the original budgetary head under ‘MH 2037 Customs’. This would be done by classifying (-) Credit to concerned minor heads below Major Head 8012- Special Deposits and Accounts’ and (-) Debit would be made under minor heads below Major Head 2037-Customs for the equal amount. The Balances lying in the scrips, issued in previous year(s), but going to expire in current financial year, the balances lying under concerned minor head below “MH 8012-Special Deposit and Accounts” shall be written back to the distinct “Minor head 911 Deduct- Recoveries of overpayment” under the MH – 2037 Customs”, in terms of General Direction 3.10 of LMMHA.

What This Means

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

• 1Export incentive scrips (RoDTEP, RoSCTL, SEIS) now follow a budgetary route from FY 2021-22 onwards
• 2Budget provision for scrip issuance is made under MH 2037 (Customs) and transferred to MH 8012 (Public Account) on issuance
• 3When scrips are used for customs duty, Public Account (8012) is debited and MH 0037 (Customs revenue) is credited
• 4Expired unused scrips are written back — same-year expiry reverses under MH 2037; previous-year expiry uses Minor Head 911 (Recoveries of Overpayment)
• 5Reassessment cases require incremental or decremental adjustments, not fresh full-value entries

Practical Example

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.