Shipping Bill Types in India: Free, Dutiable, Drawback and EOU

An export desk files every consignment as a free shipping bill because free bills clear with the lightest checks and nobody has to keep drawback paperwork. Eighteen months later the finance team asks why the duty drawback line in the budget never turned into cash. The answer sits in one field on each declaration, chosen in seconds by a broker's data-entry operator, and changing it after the goods have sailed is slow, discretionary and time-limited.

Choosing the right shipping bill type at filing protects three things: the export incentive you are entitled to, the speed of the Let Export Order, and the ledgers that bonded warehouses and export-oriented units must keep. Getting it wrong rarely stops the shipment, which is why the error survives until someone reconciles the incentive account.

• What this guide covers: the free, dutiable, drawback, ex-bond and EOU variants of the Indian shipping bill, what each one claims, and which Customs Act section or circular governs it.
• What it adds: who owns each record, a rupee example of drawback lost on a free bill with the US contrast in dollars, a timestamped scheme-code error, and the filing checks that should never be left to memory.

One electronic declaration, several schemes: what a bill's type means

Today an Indian shipping bill is a single electronic declaration on ICEGATE, and its "type" is the export scheme declared against each item, not a different printed form. The type decides what the exporter is claiming, how intensively customs examines the goods, and what happens to the bill after export.

Section 50 of the Customs Act, 1962 requires the exporter to make entry by presenting a shipping bill electronically for goods leaving by vessel or aircraft, and a bill of export for goods leaving by land. The Shipping Bill (Electronic Integrated Declaration and Paperless Processing) Regulations, 2019, notified as No. 33/2019-Customs (N.T.), define the shipping bill as the electronic declaration accepted and numbered by the Indian Customs EDI System. Separate paper forms for free, dutiable and drawback exports matter only where manual filing is allowed, under the 1991 forms regulations.

The regulations add three duties that apply to every variant. Regulation 4 deems the bill filed and self-assessment complete once ICEGATE generates the shipping bill number. Regulation 6 requires the authorised person to keep the assessed bill and original supporting documents for five years. Regulation 8 makes any contravention liable to a penalty of up to ₹50,000.

Free shipping bills: no benefit claimed and the lightest examination

A free shipping bill declares that the exporter is claiming no export-promotion benefit on the goods. In return, CBIC Circular 36/2010-Customs records that free bills are subject to nil examination norms, which is why exporters chasing a fast Let Export Order are tempted to use them by default.

In ICES the free variant appears as scheme code 00, described in a 2026 order of the Nhava Sheva Commissionerate as "Free SB involving remittance of foreign exchange". The words matter: a free bill still expects export proceeds to come back through the banking channel. It only gives up incentives that are declared on the bill, such as drawback, RoDTEP, Advance Authorisation or EPCG.

A free bill does not switch off the GST refund route. Rule 96(1) of the CGST Rules, 2017 treats the shipping bill as the application for refund of integrated tax paid on exported goods, provided the carrier has filed the export manifest or export report and the exporter has filed a valid GSTR-3B. That refund depends on GST data matching the bill, not on the export scheme.

Dutiable shipping bills: export duty fixed on the Let Export Order date

A dutiable bill is used when the goods attract export duty or cess under the Customs Tariff Act. The rate is the one in force when the proper officer makes the section 51 order permitting clearance and loading, so a late filing that crosses a notification date can change the duty.

• Rate date: section 16(1)(a) applies the rate and tariff valuation in force on the date of the section 51 order for goods entered under section 50.
• Duty before clearance: section 51(1) lets the officer permit clearance once the goods are not prohibited and the exporter has paid the assessed duty and charges.
• Deferred payment: the Central Government may notify classes of exporters allowed to pay later; section 51(2) then charges interest at a notified rate between 5% and 36% a year on unpaid duty.
• Valuation point: section 14 values export goods at the price for delivery at the time and place of exportation, so ocean freight and insurance in a CIF price are removed.

Dutiable shipping bills under section 16(1)(a) of India's Customs Act, 1962 take the export duty rate in force on the section 51 Let Export Order date, so an ICEGATE filing for goods that gain a 15% duty overnight should clear before the notification takes effect, not after.

US exporters never face this choice. Article I, Section 9 of the US Constitution states that no tax or duty shall be laid on articles exported from any state, so the Electronic Export Information record in AES carries no export duty at all. India has no equivalent constitutional bar, which is why the dutiable variant exists.

Drawback shipping bills: the declaration itself becomes the claim

A drawback shipping bill asks customs to refund duty paid on imported inputs or on imported goods being sent back out. Under the electronic system there is no separate claim form: Jawahar Customs House states that the shipping bill itself is treated as the claim for drawback.

• Section 75, inputs used in manufacture: drawback of duties on imported materials used in goods that are manufactured, processed or operated on in India, at the notified All Industry Rate or an individually fixed brand rate.
• Section 74, re-export of duty-paid goods: 98% of the import duty is repaid if the goods are identified as the ones imported and entered for export within two years of paying duty, extendable by the Board.
• Processing trigger: claims move into the drawback queue only after the shipping line's export manifest reaches the system electronically, according to the same Jawahar Customs guidance.
• Payment and interest: drawback is credited to the bank account the exporter registered with the custom house; section 75A adds interest if it is not paid within one month of the claim.
• Floor amount: section 76(1)(c) allows no drawback where the amount due is less than ₹50.

Our guide to the Let Export Order and EGM filing covers how the manifest closes the shipment and releases claims. Here the point is narrower: the drawback variant must be chosen before filing, and the drawback particulars must be declared item by item on the bill, because that declaration is the claim.

Ex-bond shipping bills for goods still lying in a customs warehouse

Goods imported into a customs warehouse can leave India without paying import duty under section 69, but only on a shipping bill, after any export duty is paid and an export clearance order is made. Since CBIC Circular 22/2023-Customs, ICES has a dedicated ex-bond format that ties each item back to its into-bond bill of entry.

• Warehouse code: the exporter declares the warehouse in the single window table with information type DIR and qualifier XSB, marking the bill as a re-export from bond.
• Item-level link: each item must carry the into-bond bill of entry site, number, date, invoice serial and item number; one item can point to only one into-bond bill.
• One warehouse per bill: goods lying in two warehouses need two shipping bills.
• Automatic ledger: on successful verification the system debits the exported quantity from the warehouse ledger, and re-credits it if the bill is cancelled or purged.
• No incentives: the circular states that no drawback, RoDTEP, RoSCTL, Advance Authorisation or EPCG benefit is available and the bill is a free shipping bill.

Before the circular, warehouse ledgers often showed goods still in bond after they had been exported, because exports were not captured against the into-bond entry. Anyone running a bonded facility should check the ex-bond quantities in ICES against the warehouse register every month; the comparison of bonded warehouses, FTZs and FTWZs explains where that register sits in each model.

EOU exports: duty-free inputs, a net foreign exchange test and their own entry

An export-oriented unit declares its EOU status on its shipping bills, and because its inputs were imported or procured without duty, input drawback does not arise on its own exports. The bill records exports that count toward the unit's net foreign exchange obligation under the Foreign Trade Policy.

• Who qualifies: para 6.00 of the Foreign Trade Policy 2023 covers units that undertake to export their entire production, except permitted domestic sales, under the EOU, EHTP, STP or BTP schemes; trading units are not covered.
• Duty-free inputs: para 6.01(d)(ii) allows imports, and procurement from bonded warehouses, without basic customs duty and the additional duties under the Customs Tariff Act, with integrated tax treatment set by Department of Revenue notification.
• Net foreign exchange: para 6.04 requires each unit to be a positive net foreign exchange earner, calculated cumulatively in five-year blocks from the start of production.
• Job work for domestic exporters: under para 6.13(b)(i) an EOU may export on behalf of a domestic exporter with annual customs permission, with the export documents in both names and brand rate drawback available to the domestic unit.

Examination follows the unit's status. The Chennai Customs export procedure notes that EOU and SEZ consignments follow the examination norms set for EPCG and Advance Authorisation exports, while consignments sealed at the factory by a customs or central excise officer follow the lighter factory-stuffed norms. EOU teams should plan stuffing and sealing around that rule rather than treating the port as the default inspection point.

EOU shipping bills filed on ICEGATE record exports against the unit's positive net foreign exchange obligation in para 6.04 of India's Foreign Trade Policy 2023, measured in five-year blocks, so each shipping bill's FOB value should post to the unit's block ledger within the month of export, not at the year-end performance report.

Choose the scheme before filing, because later conversion is narrow

Treat the scheme code as final at filing. Section 149 allows amendment after export only on the basis of documents that existed when the goods were exported, and CBIC's conversion rules add a time limit and a direction of travel.

• Three-month window: Circular 36/2010-Customs lets the Commissioner allow conversion only if the exporter applies within three months of the Let Export Order.
• Direction of conversion: conversion is allowed from schemes with more rigorous examination to less rigorous ones, such as Advance Authorisation to drawback, or between schemes with the same examination level.
• Free bills are a special case: conversion of free bills into export-promotion scheme bills should not be allowed; the Commissioner may instead allow All Industry Rate drawback on goods exported under a free bill, without converting it.
• Instrument-based schemes: the Shipping Bill (Post Export Conversion in Relation to Instrument Based Scheme) Regulations, 2022, notified as No. 11/2022-Customs (N.T.), govern conversion between scrip, licence and authorisation schemes, and a 2026 Nhava Sheva order read them as not covering free bills.

That order shows how unforgiving the window is. An exporter sought conversion of 241 free bills, with Let Export Orders between April 2022 and November 2024, to drawback with the RoDTEP flag. The Commissioner rejected 173 as time-barred under the three-month limit and 13 on merit, and allowed 55, directing that the amendment be made through the ICES post-EGM amendment module after payment of the amendment fee.

Who signs, files and releases each shipping bill record

Responsibility for a shipping bill is split between the exporter, its customs broker, the carrier and the customs officer, and the split decides who answers when the type is wrong. Section 50(3) puts accuracy, completeness and supporting documents on the exporter, even when a broker keys the data.

The table also explains why the customs broker cannot be the only control. A broker is accountable for filing what the exporter instructs; the exporter remains the party that loses the drawback, answers the accuracy duty and holds the five-year records. A short written scheme instruction per order, signed by the exporter, removes most arguments later.

Drawback lost on a free bill, in rupees, with the US claim in dollars

The cost of a wrong type is easy to compute and usually larger than the time saved at the port. The figures below are illustrative: one engineering consignment from Pune, an assumed All Industry Rate, and an exchange rate of ₹88 to the dollar.

Drawback amount and interest on a late payment (illustrative)

  DBK = min(R x FOB, C x Q)

  R   = All Industry Rate from the drawback schedule (illustrative 1.5%)
  FOB = free on board value of the item, in INR
  C   = per-unit cap in the schedule, in INR (illustrative 600 per unit)
  Q   = quantity in the schedule's unit (illustrative 120 units)

  Interest under section 75A when unpaid beyond one month:
  I = DBK x r x (d - 30) / 365
  r = rate fixed under section 27A (illustrative 6% a year)
  d = days from claim filing to payment

  Example: FOB = 48,00,000; R x FOB = 72,000; C x Q = 72,000
  DBK = 72,000; if d = 75, I = 72,000 x 0.06 x 45 / 365 = 533

The US column is a contrast, not a counterpart. US drawback is a separate claim to CBP under 19 U.S.C. 1313, refunding 99% of duties under subsection (l)(2)(B), and subsection (r)(1) treats a claim not completed within 5 years of import as abandoned. The export filing itself, Electronic Export Information in AES, carries no scheme choice; our EEI filing guide covers that record.

Drawback shipping bills on ICEGATE act as the claim under sections 74 and 75 of India's Customs Act, 1962, and section 75A adds interest when drawback stays unpaid beyond one month, so an exporter shipping 40 consignments a year at ₹72,000 each forgoes ₹28.8 lakh by defaulting to free bills.

A wrong scheme code at 22:40, traced to a rejected conversion

Scheme errors are typing errors with a long tail. This trace is illustrative; the bill numbers and times are invented, but each step follows the rules described above.

1. Day 1, 22:40, broker terminal: a data-entry operator copies the previous consignment's template into shipping bill 8814527 for the exporter's drawback-eligible pump castings and leaves scheme code 00. ICEGATE generates the number, and under regulation 4 the bill is filed and self-assessed.
2. Day 2, 14:10, container freight station: under nil examination norms the system grants the Let Export Order without an officer opening a package. The stuffed box gates into the terminal the same evening.
3. Day 6, 09:00, export manifest: the shipping line's export manifest reaches ICES. No drawback claim enters the queue because none was declared, and the integrated tax refund proceeds separately under rule 96.
4. Day 104, 11:30, finance reconciliation: the quarterly incentive review finds ₹72,000 of expected drawback missing against invoice EXP/24/0917. The exporter applies for conversion, but more than three months have passed since the Let Export Order.
5. Day 160, Commissioner's order: the request is rejected as time-barred under Circular 36/2010-Customs. The drawback is lost permanently and the exporter's next audit flags the template as a control weakness.

A rule in the broker's software that refuses scheme code 00 for any product master flagged as drawback-eligible would have stopped this on Day 1. Where an exporter genuinely wants a free bill for such a product, the override should need a named approver and a reason, recorded before submission.

Filing checks software can lock and calls a broker or officer still makes

Most shipping bill type errors can be prevented with fixed rules in the exporter's ERP or the broker's filing software. Judgement is still needed where the facts are unclear, such as whether goods are the same ones imported or whether a request for conversion has merit.

The wider ERP side of reconciling bills of entry and shipping bills is covered in our article on ICEGATE bill of entry and shipping bill reconciliation; this guide stops at choosing and controlling the type. If you need a filing workflow that enforces these checks before a bill reaches ICEGATE, you can send us your requirements, and the logistics and supply chain library covers the surrounding export processes.