2026-VIL-288-DEL-CU
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CUSTOMS High Court Cases

Customs – Treatment of DTA to SEZ Supply as Deemed Exports - Requirement of submitting Bill of Export (BOE) as proof of export obligation discharge under EPCG scheme – Appellant supplied goods to a unit in the SEZ and sought export benefits under the EPCG scheme - DGFT rejected the claim on the ground of non-submission of BOEs - Whether supplies from DTA to SEZ are "deemed exports" under the Foreign Trade Policy and whether submission of supply invoices and Bank Realisation Certificates (BRCs) is sufficient to discharge the export obligation under the EPCG scheme, or BOEs are mandatorily required – HELD – The supplies to an SEZ are not covered under any of the clauses of Para 8.2 of the Foreign Trade Policy, hence such supplies are not deemed exports. There is nothing, in Clause 8.2, to indicate that it is exhaustive of the categories of supplies which would qualify as deemed exports. While the categories of supplies enumerated in clauses (a) to (j) of Para 8.2 would unquestionably qualify as deemed exports, any other supply, which conforms to Para 8.1, would also so qualify - An SEZ is not located outside the country even if, for certain purposes, supplies to the SEZ are treated as “exports” under the SEZ Act. Therefore the supply by appellant to SEZ satisfy the description of “deemed exports”, as contained in para 8.1 - The supplies from DTA to SEZ units constitute "deemed exports" under the Foreign Trade Policy - The DGFT's contention that the SEZ Act and Rules override the FTP and HBP provisions is rejected as the SEZ Act and Rules primarily govern the functioning of SEZs and are not concerned with export incentives available to DTA units – The supply invoices accompanied by BRCs are sufficient evidence to discharge the export obligation under the EPCG scheme and BOEs are not mandatorily required. The DGFT's subsequent policy circular relaxed the BOE requirement for supplies to SEZs under the Advance Authorization scheme, and it would be unreasonable to deny EPCG benefits to the appellant merely for not submitting BOEs - The Review Petition filed by Union of India is dismissed
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