EPCG Scheme 2026: Zero Customs Duty on Capital Goods Import, Eligibility & How to Apply

At a glance

About the scheme

The EPCG Scheme, operated by the Directorate General of Foreign Trade under the Ministry of Commerce and Industry, allows eligible importers to bring in capital goods—such as machinery, computer systems, spares, moulds, dies, jigs, fixtures, tools, refractories and catalysts—without paying customs duty or IGST. In return, the holder must fulfil an export obligation equal to six times the duty saved, to be completed within six years from the date of authorisation. The scheme supports manufacturer exporters, merchant exporters tied to supporting manufacturers, and service providers, and provides concessions on the export obligation for green‑technology units, units in certain northeastern states and Jammu & Kashmir, and for those who have already achieved a large portion of their obligation.

Benefits

• Import of capital goods for pre‑production, production and post‑production at zero customs duty and IGST.
• Exemption from IGST and Compensation Cess on imported capital goods.
• Possibility of reduced specific export obligation (to 75% for green‑technology products, to 25% for units in Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and Jammu & Kashmir, or condonation after achieving 75% of specific obligation and 100% of average obligation in half the original period).

Who can apply (eligibility)

• The IEC entity must have previously imported items by paying customs duty.
• The applicant must hold an ‘Active’ IEC and be logged into the DGFT Customer Portal.
• E‑Sign and Digital Signature Certificate (DSC) must be enabled for submission.
• The applicant must be authorised to draft and submit applications for an IEC.
• GSTN details corresponding to all branches of the IEC must be available and can be added via Services > IEC Profile Management > Modify IEC.

Documents required

• Self‑certified copy of MSME/IEM/LOI/IL for products, or Service Tax Registration for service providers (or a declaration if not registered; in that case RCMC from the EPC concerned suffices).
• Certificate from a Chartered Engineer in the format given in Appendix 5A.
• Certificate from a Chartered Accountant/Cost Accountant/Company Secretary in the format given in Appendix 5B.
• For import of spares, tools, refractories and catalyst for existing plant and machinery: a list of plant/machinery already installed and imported, duly certified by a Chartered Engineer or jurisdictional Central Excise authority.
• For EOU/SEZ units: self‑certified copy of the ‘No Objection Certificate’ from the Development Commissioner showing details of capital goods imported/indigenously procured, its value at import/sourcing and the depreciated value for duty assessment.
• For amendment applications: Certificate from a Chartered Engineer for any additions/deletions; if the item is restricted, a copy of clearance by the Exim Facilitation Committee (EFC) must be uploaded.
• For invalidation: an EPCG Performa invoice of the indigenous item intended to be invalidated.
• For closure: TR‑6 Challan for regularisation and a Certificate from a Chartered Accountant in the format given in Appendix 5C.

How to apply

1. 1Visit the DGFT website at www.dgft.gov.in and log in with valid credentials.
2. 2Click on the ‘Services’ menu and navigate to EPCG.
3. 3Fill in the EPCG application form with the required details.
4. 4Upload all mandatory documents as per the checklist.
5. 5Submit the application and note the generated EPCG file number for future reference.

Frequently asked questions