Paragraph 10 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Paragraph 10.10 of the Handbook of Procedures, 2023 lets an Indian exporter apply for an authorisation to export SCOMET items in bulk to a "stockist" abroad, who then supplies the ultimate end users. The Foreign Trade Policy, 2023 mentions the type in paragraph 10.08(iii), and the procedure is only in the Handbook, so this article is on the Handbook paragraph. It gives no view on whether any item is controlled.
An application for bulk export to a stockist abroad is considered by the Inter Ministerial Working Group (IMWG). The stockist should be a subsidiary or parent company of the Indian exporter, or an affiliate, Original Equipment Manufacturer (OEM), electronics manufacturing services provider or contract manufacturer. The IMWG approves the export and gives in-principle approval for onward countries. Transfers are reported within 3 months and the holder sends an annual statement by 31st January.
The procedure is taken from Chapter 10 of the Handbook of Procedures, 2023 as published on the DGFT website (file of July 2026), consulted on 2 October 2026; the paragraph is described as it stands in that file. Later Public Notices should be checked before acting. The Handbook is issued by the Director General under section 6 of the Foreign Trade (Development and Regulation) Act, 1992, explained in our article on section 6 of the FTDR Act; the Policy is made under section 5, and Chapter 10 rests on Chapter IVA of the Act (sections 14A and 14B). If you are planning a stockist arrangement, our restricted items import-export licence team can help with the application.
What the paragraph covers
The paragraph deals with applications "for bulk export of SCOMET items (excluding Category 0, a sub-category named in the paragraph, Category 6 and transfer of technology under any category) from an Indian exporter to an entity abroad (hereinafter referred to as 'stockist') for subsequent transfer to the ultimate end users". The IMWG considers them on the conditions below. The paragraph is organised under sub-headings, which this article follows.
Applicability and scope
- (a) The stockist. The entity abroad to which the items are originally exported. It should be a subsidiary or principal (parent) company abroad of the Indian exporter. It could also be an affiliate of the Indian exporter, or an Indian or foreign OEM, Electronic Manufacturing Services (EMS) provider or Contract Manufacturer (CM). A footnote defines EMS and another says the OEM, EMS or CM case could be considered on additional documents, such as Authorised Economic Operator certification and the contract between the Indian company and its OEM.
- (b) The basis. Export is permitted from the Indian company to the stockist on the stockist's end-use declaration, through the specified End User Certificate for "Stock & Sale" purposes.
- Note. The IMWG may relax (a) and (b) in certain cases, considering the description, end use and end user of the item.
Application for export to stockists abroad and transfer to end users in specific countries
The exporter applies in the prescribed proforma, ANF 10B, with documents from the stockist:
| Item | Document |
|---|---|
| (i) | Proof of the corporate relationship between the Indian exporter and the stockist |
| (ii) | End-use or end-user certificate from the stockist, in Appendix 10J(iii) |
| (iii) | List of countries (in the certificate) to which the stockist would export the items |
| (iv) | Purchase order(s) or invoice(s), or a document in lieu |
| (v) | Technical specifications of the products |
| (vi) | Copy of the Internal Compliance Program, if the exporter or stockist has one |
| (vii) | Copy of the AEO certificate, in case of OEM, EMS or CM |
| (viii) | An undertaking on the firm's letterhead, signed and stamped by the authorised signatory, that if after the authorisation the licensee is notified in writing by DGFT or knows or has reason to believe that an item may be intended for military end use or has a potential risk of use in or diversion to weapons of mass destruction or their missile delivery, the exporter will not be eligible for the stock and sale policy for that item and will apply separately for a fresh authorisation under the regular policy. Action may be taken under the Act for any mis-declaration |
| (ix) | Copy of the corporate or business registration or certificate of incorporation of the stockist in the destination countries |
In-principle approval
- (a) The application is assessed for an authorisation for export to the stockist and for in-principle approval for re-export to specified countries of ultimate end use approved by the IMWG.
- (b) No authorisation is required for transfer from the stockist to ultimate end users within the stockist's own country and for re-export to end users in the approved countries.
- (c) Re-export to approved countries is subject to the export control regulations of the country of the stockist.
- (d) "Country" means an independent sovereign entity that is a distinct national entity in political geography. Transfers within an economic union or a customs union do not qualify as "same country transfers".
Post-reporting by the stockist's transfers
For sale or transfer by the stockist within the same country, and for re-export or re-transfer to end users in countries with in-principle approval, the Indian exporter or licensee submits details of all such transfers to the SCOMET Division of DGFT (Hqrs) in ANF 10B, including the end-user certificates from all ultimate end users and the Bill of Entry into the ultimate destination countries (for export outside the stockist's country), "within 3 months of every such transfer".
Re-export to other countries
Where the stockist wants to re-export to end users outside its country in countries for which in-principle approval was not given initially, the Indian stock and sale authorisation holder applies to the SCOMET Division in ANF 10B, by email as the paragraph states, after obtaining from the stockist the end-user certificate from each link in the supply chain (Appendix 10J(i), 10J(ii)), purchase orders or invoices, and, only if the stockist adds value, technical specifications. The IMWG considers re-export on end-use and end-user verification.
Repeat orders
Applications for the same items to the same stockist, and re-export from the stockist to end users in the same country or in pre-approved countries, are considered by the Chairman IMWG "without any consultation with IMWG members". Our article on paragraphs 10.09 and 10.11 of the Handbook explains the separate repeat-order route.
Annual reporting
- (a) The Indian exporter submits a statement of exports made from India to the stockist, transfers by the stockist to final end users, and the stockist's inventory, as on 31st December of each calendar year, by 31st January of the following year. Failure "may entail imposition of penalty and/or cancellation of authorisation".
- (b) The items exported to the stockist must be transferred to final end users within the validity period of the authorisation under paragraph 10.17 of the Handbook.
- (c) The authorisation may be revalidated under paragraph 10.20 of the Handbook.
Validity under paragraph 10.17 is 24 months unless otherwise specified; paragraph 10.20 allows revalidation in six-month blocks to a maximum of 12 months. Our article on paragraph 10.08 of the Policy lays out the validity table.
An example
Helix Valves Private Limited, an invented exporter, has a wholly owned subsidiary abroad that stocks its products. Helix applies on ANF 10B with the subsidiary's end-user certificate listing the countries to which the subsidiary will sell. The IMWG authorises export to the subsidiary and gives in-principle approval for the listed countries. The subsidiary sells within its own country without further authorisation. When it re-exports to one of the approved countries, Helix files the details, the end-user certificate and the Bill of Entry within 3 months of the transfer. When the subsidiary wants to supply a country not in the list, Helix applies again. By 31st January each year Helix sends the statement of exports, transfers and inventory as on 31st December.
Need help with a stock and sale application?
The documents from the stockist abroad drive this application, and the reports run on fixed dates. Our restricted items import-export licence team can prepare the application and a reporting calendar.
Key takeaways
- Stock and sale lets an Indian exporter send SCOMET items in bulk to a stockist abroad for onward supply to end users.
- The stockist should be a subsidiary, parent, affiliate, OEM, EMS provider or CM; the IMWG may relax the conditions in certain cases.
- In-principle approval for specified countries; no further authorisation for transfers to end users in the stockist's country or the approved countries.
- Transfers reported in ANF 10B within 3 months; annual statement by 31st January as on 31st December.
- Transfers must be completed within the validity period; revalidation under paragraph 10.20.
Read next
- Handbook of Procedures, 2023, paragraphs 10.09 and 10.11: SCOMET repeat orders and spare parts
- Paragraph 10.08 of the Foreign Trade Policy, 2023: types and validity of SCOMET authorisations
- Paragraph 10.05 of the Foreign Trade Policy, 2023: catch-all controls on non-SCOMET items
- AEO certification: Authorised Economic Operator tiers
Disclaimer: Based on the chapter-wise text of the Foreign Trade Policy, 2023 and the Handbook of Procedures, 2023 published on the DGFT website, and on the later Notifications named in this article, as consulted on 2 October 2026. The copies carry no "updated up to" date. Notifications, Public Notices, Trade Notices, the ITC(HS) schedules, Appendices and forms change often; the current text on the DGFT website should be checked before acting. This article is general information, not legal advice; check the official text before acting.