DGFT Amends Diamond Imprest Authorisation Rules

The Directorate General of Foreign Trade (DGFT) has amended Para 4.63 of the Foreign Trade Policy (FTP) 2023 through Notification No. 32/2026-27 dated 21 August 2026.

The amendment concerns the customs duty exemptions available on imports made under Diamond Imprest Authorisation. It removes the reference to Compensation Cess from the exemption provision, following the discontinuation of Compensation Cess with effect from 1 February 2026.

DGFT Notification No. 32/2026-27: Key Update

The notification amends Para 4.63 of FTP 2023 with immediate effect.

Under the revised provision, imports under Diamond Imprest Authorisation continue to receive exemption from specified customs duties and the whole of Integrated Tax leviable under the relevant provision of the Customs Tariff Act, 1975.

What Has Changed?

The earlier Para 4.63 referred to exemption from:

  • Basic Customs Duty
  • Additional Customs Duty
  • Education Cess
  • Anti-dumping Duty
  • Countervailing Duty
  • Safeguard Duty
  • Transition Product Specific Safeguard Duty, wherever applicable
  • Integrated Tax
  • Compensation Cess

The revised provision removes the reference to Compensation Cess.

Why Was Para 4.63 Amended?

The notification states that the reference to Compensation Cess has been omitted because Compensation Cess was discontinued with effect from 1 February 2026, following the recommendation of the GST Council at its 56th Meeting.

Therefore, the amendment updates Para 4.63 to reflect the current duty structure rather than introducing a new exemption.

Exemption From Integrated Tax Continues

A key point for businesses using Diamond Imprest Authorisation is that the amendment does not remove the Integrated Tax exemption.

The notification specifically clarifies that exemption from the whole of Integrated Tax leviable under sub-section (7) of Section 3 of the Customs Tariff Act, 1975 on imports under Diamond Imprest Authorisation continues to be available.

Impact on Importers

For eligible imports under Diamond Imprest Authorisation:

  1. The Compensation Cess reference has been removed from Para 4.63.
  2. The existing exemptions from the specified customs duties remain.
  3. The exemption from the whole of applicable Integrated Tax continues.
  4. The amendment takes effect immediately.

Note for Exporters and Importers

DGFT Notification No. 32/2026-27 provides a targeted amendment to Para 4.63 of FTP 2023 concerning Diamond Imprest Authorisation.

The major change is the removal of the reference to Compensation Cess, which has been discontinued from 1 February 2026. At the same time, the exemption from the whole of applicable Integrated Tax on imports under Diamond Imprest Authorisation continues.

Importers and exporters covered by the scheme should take note of the revised provision and ensure that their compliance records reflect the latest FTP wording.

Conclusion

DGFT’s latest amendment provides greater clarity on the use of Indian Rupees and foreign currencies in export transactions. By revising the rules on export contract denomination and FTP benefit eligibility, the notification aims to align trade procedures with the applicable foreign exchange framework. Exporters should carefully assess the revised provisions and ensure that their transactions meet the relevant regulatory requirements.

Notification Reference:

DGFT
Notification No. 32/2026-27
21/08/2026

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