QBAL Imports - Exemption from Additional Duty - Customs - 124/95

Circular No. 124/95-Cus. dated 8/12/95 F.No. 605/110/95-DBK Government of India Ministry of Finance Department of Revenue, New Delhi Subject: Exemption from additional duty of Customs on materials imported against Quantity Based Advance Licences issued to manufacturer- exporters subject to actual user condition- Your attention is invited to Notification No. 149/95-Cus dated the 19th September, 1995 and instruction issued vide circular No. 101/95-Customs dated the 21st September, 1995. Notification No. 149/95-Customs dated the 19th September 1995 which permits import of materials free of both basic duty of Customs and additional duty of Customs imported against Quantity Based Advance Licences for manufacture and export of Leather garments and Readymade garments including knitwear has been amended. vide, Notification No. 162/95-Csutoms dated the 1st December, 1995 (copy enclosed for ready reference) 1 . By the amending notification S.No. 3 has been added in the Table to the Notification No. 149/95-Customs specifying all products for export of which Advance Licence is issued to a manufacturer exporter on an application made on or after 1st December, 1995. 2. The effect of the amendment is that exemption from both Custom duty as well as additional duty of Customs shall be extended to imports of materials against QABAL issued to manufacturer exported only on an application made to the Licensing authorities on or after 1st December, 1995. The Advance Licence and the DEEC Book should clearly indicate that the Advance Licence has been issued for benefit of exemption from duty in terms of Notification No. 149/ 95-Customs as amended by Notification No. 162/95-Customs dated the 1st December, 1995. 3. Since the benefit of exemption is admissible only against licences issued to manufacutrer-exporter on applications made on or after 1st December, 1995 and in terms of para 66 of the Export Import Policy exports can commence only after an application for Advance Licence has been made. hence Exports made after 1.12.95 shall only be eligible for discharge of obligation against licences on which benefit of exemption in terms of Notification No. 149/95-Customs as amended by Notification No. 162/95-Customs dated the 1st Dec. 1995 is claimed. Exports made prior to 1.12.95 or made thereafter but in pursuance of an application made prior to 1.12.95 would NOT repeat would not qualify for exemption in terms of this notification and should not therefore be accepted for discharge of obligation against Advance Licence eligible for exemption in terms of Notification No. 149/95-Customs as amended by Notifications No. 162/95-Customs dated 1.12.95. 4. Whereas there was no restriction on merchant - exporters getting Advance Licences for export of Leather garments and Readymade garments including knitwear for benefit of exemption under Notification No. 149/95-Cus subject to condition that materials were imported by his supporting manufacturer as colicences and used in his factory, the amendment now made restricts the benefits only to manufacturer exporters and therefore merchant exporters, whether with or without supporting manufacturers, shall not be eligible for exemption under S.No.3 of the Table to Notification No. 149/95-Cus. However there has not been any change in the position with regard to export products as specified at S.Nos. 1 and 2 of the Table to the said notification. The actual user condition i.e. non - transferability of the licence and non- transferability of the materials imported against the licences shall be applicable in respect of all export products. All other conditions in Notification No. 149/95-Customs shall mutatis mutandis apply in respect of such exports as well as imports against quantity Based Advance Licences issued to manufacturer-exproters on applications made on after 1.12.95 and instructions contained in Circular No. 101/95 dated 21st Sept., 1995 shall also apply in respect of exports and imports against such licences. 5. Changes made in notification may please be brought to the notice of the exporting community through suitable public Notices and to the Notices of field formations through standing orders, copies of which may be forwarded to Commissioner (Drawback) as well as Director General of Inspection (Customs Central Excise). Sd/- (A.K. Madan) Under Secretary to the Govt. of India