Rationalisation of procedures in handling exporters obligations under EPCG authorizations – Reg. - Customs - 32/2016

OFFICE OF THE COMMISSIONER OF CUSTOMS NEW CUSTOM HOUSE, PANAMBUR, MANGALORE-10 C. No. S-02/03/2016 Export. Date: 07/11/2016 PUBLIC NOTICE No. 32/2016 Subject: Rationalisation of procedures in handling exporters obligations under EPCG authorizations Reg. Attention of the Importers, Exporters, Customs Brokers and other members of Trade is invited to the directions given to the field formations vide Circular No.5/2010- Cus. dated 16.03.2010, Instruction No. 609/119/2010-DBK dated 18.01.2011 and Circular No.14/2015-Cus dated 20.04.2015. The Board on examination of the same, issued instruction vide F.No. 605/71/2015- DBK dated 14.10.2016 for the rationalization of procedures in handling export obligations under EPCG authorizations. The said instruction is available on the CBEC website at www.cbec.gov.in. Some of the key points are specified hereunder:- 2. The present verification of the correctness of the installation certificates issued by Chartered Engineers is to be verified on random basis in at least 5% cases through the Central Excise Division. This verification is to be restricted to 5% cases. 3. The Circular No. 5/2010 Cus dated 16.3.2010, prescribes that export obligation (EO) of the first block should be verified in detail and if it has been found satisfactory then export obligation discharge certificate (EODC) issued at end of second block should be accepted without further verification. The instruction of 2011, reiterated that this is to be implemented, however, for past cases where exporter had not come forward for first block verification but had submitted the EODC, the EODC may be accepted subject to random verification of at least 5% of EODCs issued in such past cases. In this connection, it was noted that not meeting the block-wise, EO attracts composition fees or payment of duty with interest and this finds mention in Hand Book of Procedures (HBP) and also as per the relevant Customs notifications. 3.1. The DGFT has informed that the provisions of para 5.14 of HBP 2015-20 and the similar provisions in previous FTP/HBP 2009-14 and 2004-09 are strictly followed by Regional Authorities before issuing EODC/redemption/closure letters; and that cases of condoning delay in fulfillment of block-wise EO are considered by Regional Authorities only when exporter has obtained relaxation in terms of DGFT s power under the FTP. The DGFT has also advised its Regional Authorities to ensure that these provisions are strictly followed in respect of all unredeemed EPCG authorization issued during the Foreign Trade Policy (FTP) 2004-09, 2009-14 and 2015-20. 3.2. In the light of this, Board has decided that Customs authorities need not replicate the verification of export obligation of the first block that is being conducted by Regional Authorities and that the EODCs received under EPCG Scheme in terms of FTP/HBP 2004-09, 2009-14 and 2015-20 be normally accepted without further verification, except in 5% cases which may be verified in detail before acceptance. 4. The foregoing aspects remain subject to detailed verification of EODC when there is a need suggested by specific intelligence. Further, if Regional Authorities endorse verification of shipping bills/ other documents on an EODC, such verification shall be carried out. It also remains mandatory to verify genuineness of non-EDI shipping bills/bills of export on which an EODC may be based. 5. The selection for 5% check will be made by the Joint/Additional Commissioner and the relevant exporter shall be informed to this effect on the date of selection itself, through official email communication. 6. In view of the Board s instructions, all Exporters/Importers, Customs Brokers and the Members of the Trade are requested to take due note of the changes incorporated and co-operate with the Departmental officers in implementing the said instructions. (Dr. M. SUBRAMANYAM) COMMISSIONER OF CUSTOMS