How to Pay Customs Duty with Duty Credit Scrips

The one line answer: you pay customs duty with a scrip by holding an Active e-scrip in the Electronic Duty Credit Ledger under the same IEC that is filing the import, and letting the basic customs duty on the Bill of Entry be debited to that scrip instead of paid in cash. The credit discharges duty at full face value, and scrips change hands below face, so the duty is paid in full while the cash leaving your account is smaller.

The flow, from an Active scrip to the duty debit

The regime is set by the Electronic Duty Credit Ledger Regulations, 2021, and the transfer handshake by the ICEGATE e-scrip advisory v0.10 dated 30 May 2024, sections 3.4 and 3.5, published on the ICEGATE guidelines page. Everything below sits on those two instruments. There is no paper instrument and no counter to visit.

• Step 1. The scrip is created in the ledger. An exporter earns duty credit under RoDTEP or RoSCTL, and registration of the e-scrip is automatic at the customs station of export under Regulation 5. The credit exists as a ledger entry from that moment, not as a certificate.
• Step 2. Confirm the status before you rely on it. A scrip carries one of six statuses: Active, Utilized, Transferred, Transfer Pending, Expired and Transfer Rejected. Only Active credit can be used, and it is the first thing to check on any scrip you did not create yourself.
• Step 3. Check the validity window. Regulation 6(2) gives an e-scrip two years from the date of its creation in the ledger. Transfer does not restart that clock, so a scrip bought late in its life carries the age it already had. Plan the purchase around duty you will actually pay inside the remaining window.
• Step 4. If you did not earn it, take transfer of it. The transferor initiates the transfer using your ICEGATE ID and your IEC, and verifies with an OTP valid for fifteen minutes. The scrip then sits in Transfer Pending until you approve it. Either side can reject, which produces Transfer Rejected. Nothing moves while a transfer is pending, which is exactly where counterparty risk lives in a privately negotiated deal.
• Step 5. The credit is Active under your IEC. Once your approval goes through, the scrip is yours and its balance is available rupee for rupee at face value against duty. There is no conversion, no discounting inside the ledger and no separate application.
• Step 6. Work out the basic customs duty on the consignment. This is the number the scrip addresses, and it is usually a minority of the total payable once IGST is added. The customs duty calculator breaks a duty stack by HS code so you can see the basic customs duty share before you decide how much scrip to hold.
• Step 7. The duty is debited to the scrip when the Bill of Entry is paid. The basic customs duty is discharged from the ledger balance rather than from your bank account. Every other head on the same entry is paid in cash, in the same payment cycle.
• Step 8. The remaining balance stays in the ledger. A scrip does not have to be consumed in one entry. Whatever is not debited stays Active for the next Bill of Entry, until the balance is exhausted, at which point the status reads Utilized.

The two schemes behind the credit run on notified windows. RoDTEP is notified to 30 September 2026 by DGFT Notification 74/2025-26, and continues past that date only if a continuation is notified. RoSCTL, the Ministry of Textiles scheme for garments and made-up articles, runs on the same conditional basis. Once the credit is in the ledger it behaves identically whichever scheme created it.

What a scrip can and cannot pay

One rule decides this, and it decides everything about the arithmetic. An e-scrip discharges duties of customs specified under the First Schedule to the Customs Tariff Act, 1975, and nothing beyond that schedule. Anything levied under another provision is outside the credit.

What a scrip pays:

• Basic customs duty. This is a First Schedule levy, so it is squarely inside the credit, and it is the only head a scrip settles. Depth on the reasoning: what duties a scrip can pay.

What a scrip does not pay, and you settle in cash every time:

• IGST on the import. It is not a First Schedule duty of customs, so no scrip touches it, whatever a counterparty tells you. See what duties a scrip can pay.
• GST compensation cess. Also outside the First Schedule, therefore outside the credit, on the same reasoning.
• Social Welfare Surcharge. Outside the First Schedule as well, so it stays a cash line on the entry.

Practically, this means a scrip is worth its face value against one slice of your duty bill, not against the bill. Size the purchase against basic customs duty, never against the total payable, or you will buy more credit than the entry can absorb.

Partial cover: a scrip smaller than the duty still pays for itself

A Bill of Entry does not have to be settled from a single source. Part of the basic customs duty can be discharged by debiting a scrip and the balance paid in cash, so a scrip that covers only some of the line is not a wasted purchase. It simply earns its discount on the part it covers.

The arithmetic, which is all this section is claiming: suppose basic customs duty on an entry is Rs 10,00,000 and you hold Rs 4,00,000 of scrip bought at 96% of face, so Rs 3,84,000 of cash. That Rs 4,00,000 of duty is discharged for Rs 3,84,000, a saving of Rs 16,000, and the remaining Rs 6,00,000 of basic customs duty is paid in cash exactly as it would have been anyway. The saving scales with the covered portion and with the discount, and it is unaffected by the IGST sitting alongside on the same entry, because the scrip was never going to touch that.

The same logic runs the other way. Because scrips are whole instruments with fixed balances, a purchase can slightly over-cover the duty on one entry. Over-cover is not lost: it stays Active in your ledger and goes against the next Bill of Entry, inside the two year window from the scrip's creation.

What the credit costs to acquire

The purchase price is a discount to face value, and the size of that discount is what you are really negotiating. The transfer itself is exempt from GST: a duty credit scrip falls under HSN 4907 and the exemption sits at S. No. 137 of Notification 10/2025-Central Tax (Rate), effective 22 September 2025, with earlier transfers citing the entry in force on their own date. So no GST is added to the scrip value you pay.

On Scriphouse, the first trade per IEC is free. After that the self-serve fee is 0.40% of the value that settles plus 18% GST on the sell side, and the buy side is a spread with the ask capped at face value, so you are never asked to pay more for a scrip than the duty it will discharge. Quotes are firm and held for sixty seconds, and the full arithmetic sits on the pricing page. For how the market number behind a quote is arrived at, read how scrips are priced.

Buying the scrip you are going to debit

Everything above assumes the scrip in your ledger is genuine and unencumbered, which is the buyer's real exposure rather than the debit mechanics. Two things address it. Provenance is screened before a scrip is listed, so what you are approving has already been checked. And settlement is atomic delivery versus payment on ICEGATE: the money and the scrip move together or neither moves, which closes the Transfer Pending window that a privately negotiated deal leaves open. Payout is T+0 with a bank UTR, and every trade ships a GST invoice and a net realisation statement for your records.

The complete buy side process, from sizing the purchase to accepting the transfer, is in how to buy duty credit scrips online. On Scriphouse, Duty-Pay does the sizing for you: it takes an assessed Bill of Entry, assembles the cheapest bundle from whole scrips to cover the basic customs duty, and transfers it into your ledger ready to debit. If you clear entries continuously, Auto-Cover pre-covers each assessed entry above a floor you set, and you approve every cover before anything applies.

Where to go from here

Start by sizing the prize: run your HS codes through the customs duty calculator and read the basic customs duty share of the stack, because that is the only line a scrip reaches. Then read how to buy duty credit scrips online for the purchase itself, and the Electronic Duty Credit Ledger explained for statuses and transfers in more depth. If you export as well as import, the same rails turn your own scrips into cash the same day. See how Scriphouse works for importers.

Frequently asked questions

Can I pay customs duty with a duty credit scrip?

Yes, for basic customs duty. Hold an Active e-scrip in the Electronic Duty Credit Ledger under the IEC that is filing the import, and the basic customs duty on the Bill of Entry is debited to that scrip rather than paid in cash. The credit discharges duty at full face value under the Electronic Duty Credit Ledger Regulations, 2021, and scrips are bought below face, so the same duty costs less cash.

Can a scrip pay IGST or compensation cess on an import?

No. An e-scrip discharges duties of customs under the First Schedule to the Customs Tariff Act, 1975 and nothing else. IGST, GST compensation cess and Social Welfare Surcharge are outside that schedule and are paid in cash on every entry. Anyone offering a scrip that settles your IGST is describing something that does not exist.

What if my scrip is smaller than the duty on the Bill of Entry?

Part of the basic customs duty can be discharged by scrip debit and the balance paid in cash, so a partial scrip still earns its discount on the part it covers. If basic customs duty is Rs 10,00,000 and you hold Rs 4,00,000 of scrip bought at 96% of face, you save Rs 16,000 on that portion and pay the remaining Rs 6,00,000 in cash as usual.

How long is a scrip valid, and does buying one reset the clock?

Regulation 6(2) of the Electronic Duty Credit Ledger Regulations, 2021 gives an e-scrip two years from the date of its creation in the ledger. Transfer does not reset it, so a scrip you buy carries whatever age it already had. Check the creation date, not the transfer date, before you size a purchase.

What happens while a scrip transfer is pending?

Nothing moves. Under the ICEGATE e-scrip advisory v0.10 of 30 May 2024, the transferor initiates using your ICEGATE ID and IEC and verifies with an OTP valid for fifteen minutes, after which the scrip sits in Transfer Pending until you approve it, and either side can reject and produce Transfer Rejected. That pending window is where the risk in a private deal sits, which is why settlement that moves money and scrip together matters.