The Central Board of Indirect Taxes and Customs (CBIC) clarified regarding reversal of benefits availed under instrument-based incentive schemes governed by the Foreign Trade (Development and Regulation) Act, 1992 and the Customs Act, 1962 with effect from November 1, 2025. 

The CBIC has specified that where an importer has already availed benefits under schemes such as EPCG, Advance Authorization, Duty Credit Scrips, or other similar customs or foreign trade incentive schemes, and where such benefits are required to be reversed, no revision of customs entry (BoE) will be necessary, provided that the applicable notification or regulation already prescribes a specific procedure for reversal of benefits.

This means that importers will not need to amend or re-file Bills of Entry solely for reversing benefits if the relevant scheme notification already contains a reversal or recovery mechanism.

The change has been introduced under Section 18A(5)(c) of the Customs Act, 1962, which deals with provisional assessment and its finalization. 

In practice, disputes often arise regarding whether the importer must revise customs declarations or merely repay duty and applicable interest under scheme-specific rules. This notification eliminates ambiguity and aims to streamline compliance procedures, reduce administrative complexity, avoid duplication in documentation, provide certainty to importers and customs officers.

The clarification will be particularly relevant for:

Trade bodies have long requested uniformity in treatment of reverse recovery scenarios, particularly in cases of export obligation shortfalls or non-fulfillment of license conditions.

The notification will take effect from November 1, 2025, giving importers and customs practitioners adequate time to align their compliance practices.

Notification Details

Notification No.  71/2025-Customs (N.T.)

Date: 30th October, 2025

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