Verification of Advance Licence and monitoring of Export Obligation under DEEC scheme under the Exim Policy,2002-07 -reg. - Customs - 150/2002

OFFICE OF THE COMMISSIONER OF CUSTOMS C.R. BUILDING : QUEENS ROAD : POST BOX NO 5400 BANGALORE- 560001 F. No. VIII/48/476/2002 Dated. 22-10-2002 Public Notice No. 150/2002 Sub : Verification of Advance Licence and monitoring of Export Obligation under DEEC scheme under the Exim Policy,2002-07 -reg. 1) Under the new Exim Policy, 2002-07, changes have been carried out in the DEEC scheme, including the doing away of DEEC, Part I and Part II. Also, Para 4.11 of the Handbook of Procedures, 2002-07 provides for Description of an Advance Licence , as per which an Advance Licence shall specify the following :- a. The names and description of items to be imported and exported/supplied b. The quantity of each item to be imported or wherever the quantity cannot be indicated, the value of the item shall be indicated. However, if in Standard Input Output Norm (SION), the quantity and value of individual inputs is a limiting factor, the same shall be applicable. c. The aggregate CIF value of imports; and d. The FOB/FOR value and quantity of exports/supplies. 2) The notifications pertaining to advance licences scheme are No. 43/2002-Cus dated 19.4.2002 and No. 46/2002-Cus., dated 22.4.2002. 3) Para 4.24 of the Handbook of Procedures 2002-2007, Vol.I relates to monitoring of the fulfillment of export obligation. Further, paras 4.25 and 4.26 of the said Handbook of Procedures lay down the procedure of fulfillment of export obligation and redemption of the Advance Licence respectively. As per para 4.26 of the Handbook of Procedures, 2002-2007, Vol.I, after completion of Export Obligation, the licencee is required to submit all the relevant information/documents to the licencing authority who will redeem the case once the Export Obligation has been fulfilled. After redemption, the licencing authority shall forward a copy of the redemption letter indicating the Shipping Bill (S/B) No.s, dates, FOB value in Indian Rupees as per the S/Bs and description of the export products to the Customs authorities at the port of registration. However, before discharging the BG/LUT against the Advance Licence, Customs are required to verify if the details of exports as given in the Redemption Certificate are as per the Customs records. Further, redemption of LUT does not preclude the Customs authorities from taking action against the licence holder for any mis-declaration, misinterpretation and default detected subsequently. 4) Likewise, para 4.18 (Note(b)) of the Hand Book of Procedures provides that in respect of an Advance Licence issued where export obligation has been fulfilled and No BG/LUT facility has been provided, the licencing authority shall forward a copy of the No Bond Certificate indicating the shipping bill number, date, FOB value as per shipping bill and description of export product in respect of shipment which were taken into account for calculating fulfillment of export obligation to the customs authorities with whom the licence is required to be registered. Before allowing the imports against Advance Licence, the Customs shall verify that the details of the exports as given in the No Bond Certificate are as per their records. 5) From the above, it is clear that the Customs authorities are required to verify and ensure that details of fulfillment of Export Obligation as furnished by the exporter are proper and correct for the said purpose. It is therefore, necessary that the Customs authorities conduct proper verification of the details of exports so as to eliminate the possibility of any fraud, etc. With regard to the above, the following procedure is hereby prescribed for verification of details of exports in connection with the fulfillment of Export Obligation by the concerned licence holder.The verification work will be done by the DEEC Verification Section. a. Only the holder of Advance licence, his authorized employee or his authorized CHA will be permitted to submit documents in the DEEC Verification Section. b. In case of submission under Self Category, the holder of the Advance licence or the authorized employee of the Company/firm who will submit Advance licences shall obtain an identification number from the Inspector DEEC. For this purpose a certificate issued by the Advance licence holder in favour of the person as per format given in the Annexure - C shall be presented in duplicate to the Inspector, DEEC. The Inspector will allot a number to the person. This number shall be the identification number for the person concerned and shall be endorsed by the Inspector under his signature and stamp on both the copies of the certificate. One copy of this certificate shall be returned to the concerned person and another copy shall be kept in office records. c. Submission of documents:- Once a person has been registered as above on the recommendation of a company/firm, he/she will be eligible to submit and receive Advance licences of the company/firm for verification. However, for all licences presented for verification, an authority letter issued by the licence holder in the proforma given in Annexure - E which must contain the registration number of the person and the Advance licence number to be submitted, shall be attached in the respective verification files. The file along with other documents shall be submitted to the receiving Inspector. The receiving Inspector shall verify that the file is being submitted by the authorized person. Acknowledgements will be issued. d. In case a CHA, other than the one engaged by the exporter at the time of export shipment, is submitting the documents, the application will be signed by the proprietor/partner of the CHA firm. He will also certify that for processing of the documents before customs he has not engaged the services of any person who is not in the roll of his employment. 6) VERIFICATION OF EXPORTS FOR ADVANCE LICENCES ISSUED ON POST EXPORT BASIS. 6.1) As the requirement of DEEC book has now been dispensed with, it is necessary to verify, the licences of post-export basis and the No Bond Certificates issued by DGFT, are based on proper shipping bills and the export goods meet the requirements of the DEEC scheme. Verification will be done of the Advance Licences, which are issued on post-export basis by DGFT and Bond/BG is not required for registration of licence with Customs. The verification procedure shall precede the registration of such Advance Licences. Verification of exports shall be done by the jurisdictional Commissionerates from where exports have taken place. In case exports against an Advance Licence have taken place from two or more Commissionerates, verifications have to be done by each Commissionerate, for the exports from that Commissionerate and it shall be the responsibility of the exporter to obtain the required verification from the concerned Commissionerates. 6.2) Advance licence with the following documents shall be accepted for verification by the Inspector DEEC on any working day :- i. Acknowledgement as prescribed in Annexure-A for submission of Advance licences for verification. (in triplicate) ii. Index for documents submitted. iii. Authorisation letter of the exporter. If CHA is other than the one engaged at the time of export shipment, the acceptance of the CHA for undertaking verification (this is to be signed by proprietor/partner of the CHA firm). iv. Application of the exporter with the request for verifying the DEEC scrip. v. DEEC statement in duplicate signed by the licence holder giving details of the Shipping Bills. vi. DEEC copies of S/Bill in original vii. Photocopies of EP copies of S/Bills viii. Original copy of Bill of Lading/Certified copy of the Bill of Lading ix. Customs attested invoice x. Copies of AR-4/ARE-1, where applicable xi. Copy of test report/Chartered Engineers Certificate/Technical opinion, as applicable. xii. Bank Realization Certificate xiii. Any other documents (specified by Customs) required for verification. 6.3) The DEEC Inspector while receiving Advance Licences shall keep a record in the register prescribed for the purpose. The receiving Inspector will verify whether the original Advance licence and all other required documents have been correctly tendered at the time of submission. One copy of the acknowledgement as detailed in Annexure-A shall be given to the person submitting the Advance Licences indicating therein the Sr.No. and the Date of the entry in receipt register. The other two copies of acknowledgement will be retained in the file. The signature of the person submitting the Advance Licence for verification with his full Name, CHA No., and Pass No., shall also be recorded in the said register. 6.4) The duly verified Advance licence shall be returned the next day to the person from whom the Advance Licences were received, for verification. The Advance Licence shall be delivered only to the person who had submitted the same for verification and not to any other person. The signature of the person collecting the verified Advance Licence shall be taken on the copies of acknowledgements kept in office record and also in the prescribed register. 7) VERIFICATION OF EXPORTS FOR ADVANCE LICENCES ISSUED ON PRE-EXPORT BASIS AND AGAINST WHICH REDEMPTION LETTER HAS BEEN ISSUED BY DGFT. 7.1) Advance Licence where import takes place prior to fulfillment of export obligation are to be redeemed by DGFT based on copies of shipping bills and Bank realisation Certificates. The redemption letter is issued by DGFT and then Bond/Bank Guarantees is to be cancelled by Customs. Advance Licences, other than those issued on post-export basis and which have already been verified by Customs, are required to be verified after their redemption by DGFT. Only after such verification of exports against such licences, Bond/Bank Guarantee shall be cancelled by Customs. Verification of exports shall be done by the jurisdictional Commissionerates from where exports have taken place. In case exports against an Advance Licence have taken place from two or more Commissionerates, verifications have to be done by each Commissionerate for the exports from that Commissionerate for which responsibility would lie with the exporter. 7.2) Advance Licences with the following documents shall be accepted for verification by the Inspector DEEC on any working day :- i. Acknowledgement as prescribed in Annexure-B for submission of Advance licences for verification. (in triplicate) ii. Index for documents submitted. iii. Authorisation letter of the exporter. If CHA is other than the one engaged at the time of export shipment, the acceptance of the CHA for undertaking verification (this is to be signed by proprietor/partner of the CHA firm). iv. Application of the exporter with the request for verifying the DEEC scrip. v. DEEC statement in duplicate signed by the licence holder giving details of the shipping bills. vi. Redemption Letter (Export Obligation Discharge Certificate), in original. vii. DEEC copies of S/Bills in original viii. Photocopies of EP copies of S/Bills ix. Original copy of Bill of Lading/Certified copy of the Bill of Lading. x. Customs attested invoice xi. Copies of AR-4/ARE-1, where applicable xii. Copy of test report/Chartered Engineers Certificate/Technical opinion, as applicable. xiii. Bank Realization Certificate xiv. Any other documents (specified by Customs) required for verification. 7.3) The DEEC Inspector while receiving Advance Licence shall keep a record in the Redemption Register, prescribed for the purpose. The receiving Inspector will verify whether the original Advance licence and all other required documents have been correctly tendered at the time of submission. One copy of the acknowledgement as detailed in Annexure-B shall be given to the person submitting the Advance Licence indicating therein the Sr.No. and Date of the entry in receipt register. The other two copies of the acknowledgement will be retained in the file. The signature of the person submitting the Advance Licence and Redemption Letter for verification with his full name, CHA No., and Pass No., shall also be recorded in the said register. 7.4) The procedure of verification of Advance Licence shall be completed by the next day after the date of receipt of the Advance Licence for verification. After completion of the verification of the Advance Licence, the file shall be sent to the Superintendent/Appraiser who will initiate action immediately for cancellation of the Bond/BG/LUT. The procedure of cancellation of BG/Bond/LUT will be completed within 2 days. After cancellation procedure is completed the cancelled BG/Bond/LUT along with the verified Advance licence shall be returned only to the person, who had submitted the Advance Licence for verification, on proper receipts. 8) The above instructions may be brought to the notice of all concerned. (A. P. SUDHIR) COMMISSIONER OF CUSTOMS BANGALORE ANNEXURE -A (to be presented in triplicate) DEEC SECTION INSPECTOR OF CUSTOMS ACC/ICD BANGALORE Date : Received Advance Licence No. . Dated for verification which has been entered in the prescribed register at Sr. No . / .. (year). Verified licence may be collected between 3pm to 5pm on ., by the person who has submitted the same. (Inspector of Customs) DEEC Section ACC/ICD BANGALORE NAME SIGNATURES OF THE PERSON SUBMITTING THE DOCUMENTS DATE : NAME SIGNATURE OF THE PERSON (Inspector of Customs) RECEIVING THE ORIGINAL ADVANCE ACC/ICD LICENCE BANGALORE DATE : ANNEXURE -B (to be presented in triplicate) DEEC SECTION INSPECTOR OF CUSTOMS ACC/ICD BANGALORE Date : Received Advance Licence No. . Dated for verification which has been entered in the prescribed register at Sr. No. . / .. (year). Verified licence and the cancelled BG/Bond/LUT may be collected between 3pm to 5pm on ., by the person who has submitted the same. (Inspector of Customs) DEEC Section ACC/ICD BANGALORE NAME SIGNATURES OF THE PERSON SUBMITTING THE DOCUMENTS DATE : NAME SIGNATURE OF THE (Inspector of Customs) PERSON RECEIVING THE ACC/ICD ORIGINAL ADVANCE LICENCE BANGALORE DATE : ANNEXURE -C (for use by exporter not engaging CHAs submitting for records of DEEC Verification Section). CERTIFICATE 1 Name 2 Age 3 Full Postal address (Office) (Resd) 4 Designation 5 Signature This is to certify that the person as mentioned above is our employee holding designation as mentioned above and is on the pay roll of the firm/company. He has been authorised by us under Section 147 of Customs Act, 1962 to act as out true representative for our purpose of verification of Advance licence issued to us. We understand that anything done by this person shall be deemed to have been done with our knowledge and consent, so that in case of any proceedings under this Act, we shall be liable as if the thing had been done by us. The details as given are true and correct. (Signature) Attested by bank This is to certify that signature of Name Shri Designation Is as per our record Name of the Company/firm Full address with Tel. No. Fax No. E- mail Note : The Photograph shall be signed by the same person who has signed this certificate on behalf of the company.