Circular No. 5/97 Cus dated 14.03.97. Notfns. No.28/97 Cus & No. 29/97 Cus, both dated 01.04.97 and No. 110/95 Cus & No.111/95. - Customs - 032/98

Circular No. 32/98-Customs dated 5/5/1998 F.No. 605/55/98- DBK Government of India Ministry of Finance Department of Revenue, New Delhi Attention is invited to the Board's Circular No. 5/97-Cus. dated 14.3.97 outlining the procedure for monitoring the fulfilment of export obligation under EPCG Scheme. Thereafter on 1.4.97, two Notification Nos. 28/97-Cus. and 29/97-Cus. both dated 1.4.97 were issued under EPCG Scheme consequent to announcement of new EXIM Policy for the period 1997-2002. Notification No. 28/97-Cus. provided for levying customs duty @ 10% and Notification No. of Export and Import Policy (EXIM POLICY) 1997 - 2002 announced on 13.4.98 also some changes have been made in the existing EPCG Scheme. The effects of these changes are explained in Board's Circular No. 31/98-Cus. dated 5.5./98 Customs Notification No. 8/98-Cus. and 9/98 -Cus. both dated 23.4.98 may also be referred in this regard. As a result it has become necessary to make amendment in Board's Circular No. 5/97-Cus. dated 14.2.97 so as to incorporate system of monitoring export obligation under 15% (now 10%) and Zero Duty EPCG Scheme as outlined in Customs Notification No. 110/95-Cus., 111/95- Cus., 28/97-Cus. and 29/97-Cus. Accordingly, the following amendments are made in the Board's Circular No. 5/97-Cus. dated 14.3.97. 2.1 In the first paragraph of the Circular, for the words, figures and letters" 15% and Zero Duty EPCG Scheme", the words, figures and letters "15%, 10% and Zero Duty EPCG Scheme " shall be substituted. 2.2 In the last sub para of paragraph (b) of the Circular, for the words, for the words, figures and letters "notification NO. 111/95-Cus." the words, figures and letters "Notification No. 110/95-Cus., 111/ 95-Cus., 28/97-Cus., or 29/97-Cus. shall be substituted. 2.3 In annexure I(a) to the Circular, for the entry S.No. 11, the following shall be substituted. 11. Date of Completion of Export Obligation a) For Notification No. 110/95-Cus. or 28/97-Cus Year 1st 2nd 3rd 4th 5th Proportionate FOB Value. b) For Notification No. 111/ 95-Cus. or 29/ 97- Cus. Block 1st 2nd 3rd 4th Proportionate FOB Value 2.4 In Annexure III to the Circular, in Entry S. No. 10, the following shall be added after the existing entries : 10. :- Pro rata % of export obligation to be achieved for each Year. 25% of ED. ED Achieved Pro rata of ED to be achieved for each Year 25% of ED. ED Achieved. 1. Nil - Rs. 1. - " - Rs. *1. Nil - Rs. - 1. Nil 2. 10% - Rs. 2. - " - Rs. *2. 15%- Rs. - 2. -- 3. 20% - Rs. 3. - " - Rs. *3 35% - Rs. - 3. -- 4. 30% - Rs. 4. - " - Rs. *4 50% - Rs. - 4. -- 5. 40% - Rs. 5. - " - Rs. * In case of Electronics / Food Processing etc. and software Sectors, Export Obligation for First, Second and Third Block in 15%, 35% and 50% respectively. 2.5 Annexure IV to the Circular shall be substituted by the new Annexure IV annexed to this Circular. 3. In the revised EXIM Policy issued on 13.4.98, Para 6.10 which provided for filing of bonds and / or bank guarantee under EPCG Scheme has been deleted. As a result an impression is created that henceforth on bond or bank guarantee may required to be filed under EPCG Scheme which is not correct. In this regard attention is invited to Board's Circular No. 45/96-Cus. dated 28.8.96 (F.No.605/75(A)/ 95-DBK) and further clarification issued vide Circular No. 38/97- Cus. dt. 19.9.97 which provides for the norms for execution of the bond/ bank guarantee under EPCG Scheme. It is reiterated that the requirement of filing bond or bank guarantee under EPCG Scheme. It is reiterated that the requirement of filing bond or bank guarantee shall continue to be in force in terms of relevant Customs Notification read with Board's Circular No. 45/96-Cus. 4. Customs House may issue standing orders for the guidance of the staff so as to incorporate these amendments in their existing standing orders. It is reiterated that instructions contained in this Circular and Circular No. 5/97-Cus dated 14/3/97 are followed scrupulously and the register, time diary etc. are maintained and supervised every month by the Asstt. Commissioner of customs and every quarter by the Deputy Commissioner of Customs for effective monitoring. Sd/- (Sunil Kumar) Director (Drawback) Annexure IV (Revised) Show Cause Notice Under EPCG Scheme Subject:- Import of Capital goods under EPCG Scheme .... Licence No. ..........Dt. ............. Bond for Rs. .......... Bank Guarantee .............. A. For Non-discharge of proportionate Export obligation via block or year. Whereas it appears the M/s. (The licence holder) and M/s. (the authorised Customs House Agent) have failed to achieve the pro rata % of export obligation prescribed under Notification No. 110/ 95- Cus./ 111/ 95-Cus., 28/97-Cus., 29/97-Cus and therefore the pro rata duty foregone on the goods imported becomes recoverable as per condition 4 to Notification No. 110/ 95-Cus. / condition 4 to Notification No. 111/ 95- Cus./ condition No. 3 to Notification No. 28/ 97-Cus. / condition No. 3 to Notification No. 29/97-Cus. and, therefore, they are hereby called upon to show cause to the Asstt. Commissioner of Customs, GP, Customs House, as to why the said duty amounting to Rs. ............ shall not be confirmed and collected from them within 10 days from the date of receipt of this notice, failing which the case shall be decided ex- parte on the basis of the available evidence on record. 2. You are also requested to state whether you wish to be heard in person before the case in finally decided. B. For Non - discharge of 25% of Export obligation for 3 years/ 2 Blocks of two years. Whereas it appears that M/s. (Licence holder) and M/s. (Authorised Customs House Agent) have failed to adhere to discharge at least 25% of the export obligation fixed for 3 consecutive years/ 2 consecutive block of 2 years as per Notification No. 110/ 95 / 111/95-Cus. /28/ 97- Cus./29/97-Cus. and are found liable to remit the full duty foregone as per condition 5 to Notification No. 110/ 95, Notification No. 111/95-Cus. / condition No. 4 to Notification No. 28/97-Cus./ 29/97-cus./ 29/97-Cus. and, therefore, they are called upon to show cause to the Asstt. Commissioner of Customs, GP _______, Customs House as to why the said duty amounting to Rs. should not be confirmed and recovered from them within 10 days from the date of receipt of this notice failing which the case shall be decided on the strength of available evidence on record 2. Para 2 same as in 'A' above. C. For failure to import goods of specified value. Whereas it appears that M/s. (Licence Holder) and M/s. (authorised agents) have failed to import capital goods. etc. ........ detailed in the table annexed to Notification No. 111/95- Cus., 29/97-Cus. for a minimum value of Rs. 20 crores or Rs. 1 crores or Rs. 10 lakhs as provided in condition (2) to Notification No. 29/97- Cus. within the validity period of the EPCG Licence No. ................ dt. .................. issued to the said licence holder by the Licensing Authority and, therefore, as per condition 6 to Notification No. 111/95 Cus. or condition 5 to Notification No. 29/97- Cus., the entire duty foregone has become recoverable. They are hereby called upon to show cause to the Asstt. Commissioner of Customs, GP ______, Customs House, as to why the said amount should not be confirmed and recovered within 10 days from the date of receipt of this notice with all evidences in original upon which they wish to rest their case of defence, failing which the case shall be decided on the strength of the available evidence on record. 2. Same as in 'A' above. D. Final Notice for production of Certificate of discharge of export obligation. G / Men, Sub:- EPCG Scheme - 15% duty scheme / 10% Duty Scheme / Zero rate of duty Scheme - Discharge of export obligation against Licence No. ............. dated ............ - production of Certificate from Licensing Authority - Reg. Ref :- (i) This Customs House public Notice/ and Cus. Notfn. No. 110/ 95, 111/ 95, 28/97-Cus. and 29/97-Cus. (ii) Bond No. ............... Your attention is invited to the Bond executed with this Custom House under EPCG - 15%/ 10%/ Zero rate of duty Scheme. The time limit for production of Certificate of export obligation for the 1st/2nd/ 3rd /4th /5th year/ block expired on ________ (date). You have not produced the certificate so far as required by the said Notification. 2. As a very Special case an opportunity to produce the Certificate has been extended by AC Cus. GP, by 10 days. You are, therefore, informed that it the Certificate is not obligation has not been fulfilled and the duty foregone will be recovered treating this as the final notice. Yours Faithfully, ASSESSING OFFICER (GP) For Asstt. Commissioner of Customs. F. Note : Delete Whatever is not applicable.