What happens if I do not close my EPCG authorization after the export obligation period expires?

Failure to close an expired EPCG authorization triggers automatic penalties and accumulating interest at 12% per annum on any shortfall amount. DGFT may initiate recovery proceedings and impose a demand notice for differential duty plus penalty. Your IEC may be flagged, restricting future import benefits under other schemes. It is advisable to file closure within 30 days of authorization expiry to minimize penalties.

Can I request an extension of my EPCG authorization instead of closing it?

Yes, EPCG authorizations can be extended by up to 2 years from the original expiry date under FTP 2023-28. However, extension is granted only if you have demonstrated consistent export performance and have no pending compliance violations. Extension requests must be filed with DGFT at least 90 days before the authorization expires. Upon extension approval, a new obligation period is set, and closure would apply only after the extended period concludes.

What is the timeline for receiving the EPCG Closure Certificate after I submit my application?

After submitting your closure application, Customs typically issues the Duty Assessment Order within 30-45 days. Once you remit the assessed amount, DGFT processes the closure and issues the Closure Certificate within 15-20 working days. The entire process, including payment, usually takes 60-90 days. However, if there are discrepancies in documentation or complex export verification requirements, timelines may extend.

If my company has merged or been acquired, who is responsible for EPCG closure—the original company or the new entity?

In case of merger or acquisition, the surviving entity or new entity assumes all liabilities and obligations of the original EPCG authorization. The closure application must be filed by the surviving entity in its IEC. Supporting documents should include the merger deed, board resolutions, and amended IEC reflecting the new ownership. If the original company is completely dissolved, the surviving entity files closure on behalf of the old authorization and bears all financial liabilities.

What penalties apply if my exports fell short of the EPCG obligation?

Shortfall penalties depend on the extent of non-fulfillment. If shortfall is less than 10% and deemed unintentional, penalty is up to 5% of differential duty or ₹5 lakh, whichever is less. For shortfall exceeding 10% or deemed intentional (e.g., goods diverted to domestic sale), penalty can reach 25% of differential duty plus interest at 12% per annum. CBIC assesses the circumstances and issues the final penalty order, which can be contested through customs appeal procedures.

EPCG Closure / Surrender

Expert EPCG closure and surrender services in India. Complete guidance on export obligation settlement, duty liability calculation, and DGFT compliance documentation.

Collect and verify all EPCG authorization documents, including the original letter of approval from DGFT and all amendments.
Compile complete export performance data from shipping bills, Bills of Entry, and export invoices for the entire obligation period.
Prepare a detailed closure reconciliation statement showing import values, duty paid, export achievements, and any shortfall with corresponding financial liability.
File the EPCG Closure/Surrender application on the DGFT online portal with all supporting documents in prescribed format and submit to the regional DGFT office.
Receive the Duty Assessment Order from Customs, calculate total liability including differential duty and interest, and remit payment to complete the closure process.

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What is EPCG Closure / Surrender?

EPCG (Export Promotion Capital Goods) Closure/Surrender refers to the formal process of terminating or relinquishing an EPCG authorization issued by the Directorate General of Foreign Trade (DGFT) under the Foreign Trade Policy (FTP) 2023-28. An EPCG authorization permits duty-free import of capital goods for export production, subject to fulfillment of export obligations within a stipulated period (typically 5 years, extendable by 2 years). Closure occurs when an exporter voluntarily surrenders the scheme or completes its statutory obligations, while surrender may be compulsory due to non-fulfillment of obligations.

The closure process ensures compliance with the Foreign Trade (Development & Regulation) Act, 1992 (FTDR Act) and Customs Act, 1962. Upon closure, the exporter must settle all pending liabilities, including differential customs duty on shortfall in export obligations, interest, and applicable penalties as prescribed by the Central Board of Indirect Taxes and Customs (CBIC). DGFT maintains a centralized record of all EPCG closures through the SION (Specific Input Output Norms) database and the Automated System for Custom Data (ASCD).

Pricing

Package	Price	Details
Standard	On request	Including document prep

Process

📋
Collect and verify all EPCG authorization documents, including the original letter of approval from DGFT and all amendments.
🔍
Compile complete export performance data from shipping bills, Bills of Entry, and export invoices for the entire obligation period.
📝
Prepare a detailed closure reconciliation statement showing import values, duty paid, export achievements, and any shortfall with corresponding financial liability.
✅
File the EPCG Closure/Surrender application on the DGFT online portal with all supporting documents in prescribed format and submit to the regional DGFT office.
📤
Receive the Duty Assessment Order from Customs, calculate total liability including differential duty and interest, and remit payment to complete the closure process.

Documents Required

Original EPCG Authorization Letter issued by DGFT and all subsequent amendments or addenda.
Digitally signed Bills of Entry (BE) for all imports made under the EPCG authorization with Customs acknowledgments.
Shipping Bills and export invoices covering the entire obligation period, certified by the Chartered Accountant or Statutory Auditor.
Bank statements or payment proof showing duty payment for imported capital goods under the authorization.
Reconciliation statement prepared by the exporter reconciling imports, exports achieved, and outstanding shortfall with financial calculations.
IEC certificate (valid) and GST registration certificate (if applicable) of the exporting company.

Frequently Asked Questions

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EPCG Closure / Surrender

Expert EPCG closure and surrender services in India. Complete guidance on export obligation settlement, duty liability calculation, and DGFT compliance documentation.

Collect and verify all EPCG authorization documents, including the original letter of approval from DGFT and all amendments.

Compile complete export performance data from shipping bills, Bills of Entry, and export invoices for the entire obligation period.

Prepare a detailed closure reconciliation statement showing import values, duty paid, export achievements, and any shortfall with corresponding financial liability.

File the EPCG Closure/Surrender application on the DGFT online portal with all supporting documents in prescribed format and submit to the regional DGFT office.

Receive the Duty Assessment Order from Customs, calculate total liability including differential duty and interest, and remit payment to complete the closure process.

Google VerifiedBusiness

500+Export Clients Served

End-to-EndEXIM Support

What is EPCG Closure / Surrender?

Package

Price

Details

Standard

On request

Including document prep

Process

📋

Collect and verify all EPCG authorization documents, including the original letter of approval from DGFT and all amendments.

🔍

Compile complete export performance data from shipping bills, Bills of Entry, and export invoices for the entire obligation period.

📝

Prepare a detailed closure reconciliation statement showing import values, duty paid, export achievements, and any shortfall with corresponding financial liability.

✅

File the EPCG Closure/Surrender application on the DGFT online portal with all supporting documents in prescribed format and submit to the regional DGFT office.

📤

Receive the Duty Assessment Order from Customs, calculate total liability including differential duty and interest, and remit payment to complete the closure process.

Documents Required

Original EPCG Authorization Letter issued by DGFT and all subsequent amendments or addenda.

Digitally signed Bills of Entry (BE) for all imports made under the EPCG authorization with Customs acknowledgments.

Shipping Bills and export invoices covering the entire obligation period, certified by the Chartered Accountant or Statutory Auditor.

Bank statements or payment proof showing duty payment for imported capital goods under the authorization.

Reconciliation statement prepared by the exporter reconciling imports, exports achieved, and outstanding shortfall with financial calculations.

IEC certificate (valid) and GST registration certificate (if applicable) of the exporting company.

Frequently Asked Questions