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Core Purpose

Notification amending the Scheme Guidelines for the Production Linked Incentive (PLI) Scheme for the Automobile and Auto Component Industry, revising the Domestic Value Addition formula and adding new definitional sub-paragraphs.

Detailed Summary

Issued by the Ministry of Heavy Industries on 31st August 2023 (S.O. 3857(E)), this notification partially modifies the Scheme Guidelines for the Production Linked Incentive (PLI) Scheme for the Automobile and Auto Component Industry originally notified vide S.O. 3947(E) dated 23rd September 2021, with the amendments effective from the date of publication in the Official Gazette; sub-paragraph 2.26 is substituted to redefine 'Domestic Value Addition' as a percentage calculated using the formula [(Adjusted Ex-factory price of the product minus Adjusted Import content) / Adjusted Ex-factory price of the product] x 100, net of GST, and to be certified by a Testing agency of the Ministry of Heavy Industries (MHI), with Ex-Factory Price, CIF (Cost, Insurance and Freight), Adjusted Ex-factory price and Adjusted Import content all separately defined; three new sub-paragraphs (2.28, 2.29, 2.30) are inserted after sub-paragraph 2.27, defining Frequently Asked Questions (FAQs) compiled by MHI from stakeholder consultations, Weighted Average Discount (the weighted average of discounts offered by applicants to dealers/distributors over the preceding 12 months), and Non-Originating Material and Services; the notification is signed by Hanif Qureshi, Joint Secretary, under F. No. 12(11)/2020-AEI (21370).

Full Text

5593 GI/202 3 (1) रजिस्ट्री सं. डी.एल.- 33004/99 REGD. No . D. L. -33004/99 EXTRAORDINARY PART II —Section 3 —Sub-section ( ii) PUBLISHED BY AUTHORITY No. 3696] NEW DELHI, THURSDAY , AUGUST 31, 2023/ BHADRA 9, 1945 CG-DL-E-31082023-248462 [फा. सं. 12(11)/2020 -एईआई (21370)] MINISTRY OF HEAVY INDUSTRIES NOTIFICATION (AMENDMENT) New Delhi, the 31st August, 2023 S.O. 3 857(E).— In partial modification of the Scheme Guidelines for the Production Linked Incentive (PLI) scheme for Automobile and Auto Component industry which was notified by the Ministry of Heavy Industries vide S.O. No. 3947(E) dated 23rd September 2021, the following amendments are made with effect from date of its publication in the Offi cial Gazette: - Amendment of sub -paragraph 2.26 to be read as under : Para 2.26 : Domestic Value Addition: The term “Domestic Value Addition” will be construed as the percentage of manufacturing activity being undertaken in that referred part of the s upply chain. It will be certified by Testing agency of MHI. % Domestic Value Addition = [{Adjusted Ex -factory price of the product – (minus) Adjusted Import content} / Adjusted Ex -factory price of the product] x 100, where, Ex-Factory Price shall mean pri ce of the product at the factory gate, before applicable taxes. CIF shall mean Cost, Insurance and Freight. Adjusted Ex -factory price of the product = Ex -factory price of the product - (minus) Total Exempted Import as per FAQs – (minus) Weighted Average Di scount in excess of the dealer/ channel margin. Adjusted Import content = Import content i.e. sum of CIF value of all non -originating materials and services including royalty in the final product including non -creditable import duties - (minus) Total Exem pted Import as per FAQs. The entire calculation above is net of GST. After sub -paragraph 2.27, sub -paragraphs 2.28, 2.29 & 2.30 will be added, namely : Para 2.28 : Frequently Asked Questions (FAQs): FAQs are the queries raised during interactions/stak eholder consultations with applicants and auto industry associations. These queries have been compiled in the form of FAQs in this Scheme and published by MHI from time to time. Para 2.29 : Weighted Average Discount: It is the weighted average of dis counts offered by the applicants on the AAT product to their dealers / distributors in the last 12 months. Para 2.30 : Non-Originating Material and Services: Material and Services whose country of origin is other than the country in which that materia l / service is used in manufacturing and any material / service whose origin cannot be determined. [F. No. 12(11)/2020 -AEI (21370)] HANIF QURESHI, Jt. Secy. Uploaded by Dte. of Printing at Government of India Pr ess, Ring R oad, Mayapuri, New Delhi -110064 and Published by the Controller of Publications, Delhi -110054.

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