Exemption to special goods imported for production or packaging of goods for exports by units within the Vishakapatnam Export Processing Zone - 170/93 - Customs -Tariff

Exemption to special goods imported for production or packaging of goods for exports by units within the Vishakapatnam Export Processing Zone Notification No. 170/93-Cus. Dated 13-9-1993 In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods specified in the Annexure to this notification (hereinafter referred to as the goods), when imported into India for the production of goods for exports out of India or for being used in connection with the production or packaging of goods for exports out of India or for promotion of such exports by units within the Vishakapatnam Export Processing Zone (hereinafter referred to as the Zone) comprising of places bearing the survey numbers and enclosed by the boun daries specified in paragraph 5 from the whole of the duty of customs leviable thereon under the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and the additional duty, if any, leviable thereon, under section 3 of the second mentioned Act, subject to the following conditions, namely :- (1) the importer has been authorised to establish the manufacturing unit or units in the Zone; (2) the importer has been granted necessary licence for the import of goods; (3) the importer satisfies the Development Commissioner that the goods so imported will be used in connection with the production or packaging of goods for export out of India or with the promotion of such exports of goods; (4) the importer agrees to execute a bond in such form and for such sum as has been prescribed by the Development Commissioner of the Zone binding himself to fulfil the export obligations, and to fulfil, inter alia the conditions stipulated in this notification and in the Export Import Policy of the Government of India for the time being in force; (5) the importer agrees - (a) to bring the goods into the Zone and use them within the Zone in connection with the production or packaging of goods for export out of India or with the promotion of such exports of goods; (b) to export out of India, all goods so produced or packaged or to use such goods for imparting training to workers or to sell such goods within the said Zone, as the case may be; (c) to export or dispose of in the manner approved by the Development Commissioner all remnants arising out of such production or packaging; (6) the importer shall maintain a proper account of import, consumption and utilisation of goods and of exports made by him, and shall submit such account periodically to the Development Commissioner, in such form and in such manner as may be laid down by the said Commissioner; (7) the importer shall pay, on demand, an amount equal to the duty leviable - (a) on goods which are capital goods as are not proved to the satisfaction of the Assistant Collector of Customs to have been - (i) installed or otherwise used within the Zone or re-exported within a period of one year from the date of importation thereof or within such extended period as the Assistant Collector of Customs may, on being satisfied that there is sufficient cause for not using them within the Zone or for not re-exporting them within the said period, allow; (ii) retained within the Zone after installation or use inside the Zone; (b) on goods other than capital goods as are not proved to the satisfaction of the Assistant Collector of Customs to have been - (i) used in connection with the production or packaging of goods (within the Zone) for export out of India or with the promotion of export of such goods or re-exported within a period of one year from the date of importation thereof or within such extended period as the Assistant Collector of Customs may, on being satisfied that there is sufficient cause for not using them or for not re-exporting them within the said period, allow; (ii) retained within the zone in connection with the production or packaging of goods for export out of India or with the promotion of export of goods; (c) on goods so produced or packaged as have not been exported out of India and on unused goods (including empty cones, bobbins or containers, if any, suitable for repeated use) as have not been exported, within a period of one year from the date of importation of such goods or within such extended period as the Assistant Collector of Customs may on being satisfied that there is sufficient cause for not exporting such goods within the said period, allow; (8) the Collector of Customs, may, subject to such conditions and limitations as may be imposed by him permit any goods imported or goods produced or packaged therefrom to be taken outside the Zone temporarily without payment of duty for repairs, processing or display and the importers shall be bound to comply with such conditions and limitations; (9) the Assistant Collector of Customs may, subject to such conditions as may be prescribed by him, allow goods (including goods manufactured) in the Zone to be supplied/transferred from a unit in the Zone to a unit in another Zone or to a 100% Export Oriented Unit subject to necessary permission granted by the Development Commissioner and satisfaction of conditions prescribed in the Export Import Policy of the Government of India for the time being in force; (10) the Collector of Customs may, subject to such conditions as may be prescribed by him, allow a unit to re-export the goods, on the necessary permission being granted by the Development Commissioner; (11) subject to the satisfaction of the Collector of Customs, duty shall not be leviable in respect of the following goods, namely :- (a) goods lost or destroyed not due to any wilful act, negligence or default of the importer, his employee or agent; (b) goods damaged or deteriorated not due to any wilful act, negligence or default of the importer, his employee or agent and therefore, not suitable for use in the production of goods or packaging within the Zone; (c) scrap or waste material arising in the course of such production, if such scrap or waste material is within such limits as may be specified in this behalf by the Central Government, and destroyed within the Zone; (d) samples of goods produced or packaged in the Zone which are allowed by the Assistant Collector of Customs to be sent for test outside the Zone subject to such conditions as he may specify in this behalf and which are consumed in the course of such test; (e) samples of goods imported for study or design within the Zone, which, in the course of manufacturing operations have been broken up and rendered insignificant in commercial value; (f) goods used for imparting training to workers within the Zone or goods sold by a manufacturer within the Zone to another manufacturer inside the Zone subject to such conditions, and the execution of such bonds, as may be specified by the Assistant Collector of Customs for ensuring that the goods so sold will be used in connection with the production or packaging of goods for export out of India or with the promotion of such export of goods; (g) goods manufactured in the Zone and which are allowed to be taken outside the Zone temporarily for repairs, processing or display; (h) rags, trimmings and tailor cuttings arising in the course of manufacture of readymade garments, when cleared from the Zone, provided that the percentage of such waste material in the form of rags, trimmings and tailor cuttings does not exceed the percentage fixed in this regard by the Vishakapatnam Export Processing Zone Board; (i) goods (including goods manufactured) in the Zone and which are allowed to be supplied/transferred from a unit in the Zone to a unit in another Zone or to a 100% Export Oriented Unit; (j) goods which are allowed to be re-exported from a unit in the Zone. 2. The following goods will not be required to be accounted for under condition (6) of paragraph 1 by way of export, namely :- (a) (i) goods damaged or deteriorated not due to any wilful act, negligence, or default of the importer, his employee or agent and therefore not suitable for use in the production of goods within the Zone, if destroyed within the Zone or if cleared from the Zone for use in any other part of India on payment of duty equal to that leviable on the goods if imported in sound conditions; or (ii) scrap or waste material arising in the course of production of goods within the Zone, if destroyed within the Zone or if cleared from the Zone for use in any other part of India on payment of the duty equal to that leviable on goods if imported in that form: Provided that if the percentage of scrap or waste material arising in the course of production or packaging of the said goods exceeds the percentage fixed in this regard by the Vishakapatnam Export Processing Zone Board, the duty equal to that leviable on the mother material, out of which the said scrap or waste material has arisen, shall be charged on the excess quantity; (b) empty cones, bobbins or containers, suitable for repeated use, and cleared from the Zone for use in any other part of India on payment of the duty equal to that leviable on such goods at the time of their importation into India; (c) chindies, paper cuttings, and the waste packing material arising in the course of production of goods within the Zone, when destroyed under the supervision of an officer of customs in accordance with the procedure specified in this behalf by the Assistant Collector of Customs of the Zone; (d) rags, trimmings and tailor cuttings arising in the course of manufacture of readymade garments, when cleared from the Zone. 3. Without prejudice to any other provisions contained in this notification where it is shown to the satisfaction of the Collector of Customs - (a) that any unit in the Zone has been allowed to withdraw from the Zone, or has been permitted to dispose of any capital goods outside the Zone in any other place in India, in accordance with the Import-Export Policy of the Government of India for the time being in force, by the Vishakapatnam Export Processing Zone Board; and (b) that the concerned capital goods so permitted have been used within the Zone for a period of not less than three years, the Collector of Customs may allow such capital goods to be taken outside the Zone to any other place in India on payment of an amount equal to the duty leviable on such capital goods on the depreciated value thereof at the time of clearance and at the rates in force at the time of their import. 4. Notwithstanding anything contained in this notification, (a) the exemption contained herein shall also apply to those goods which on importation into India are used in connection with the production or manufacture or packaging of excisable goods produced or manufactured within the Zone and such excisable goods, even if not exported out of India, but brought to any other place in India under, and in accordance with, the Export and Im port Policy of the Government of India for the time being in force and subject to the quantity and such other limitations and conditions as may be specified in this behalf by the Development Commissioner of the Zone, on payment of duty of excise leviable on such excisable goods under section 3 of the Central Excises and Salt Act, 1944 (1 of 1944); (b) the Assistant Collector of Customs may allow any excisable goods produced or manufactured or packaged within the Zone, to be taken outside the Zone to any other place in India for the purposes of display as samples subject to such conditions and restrictions as may be specified by the Development Commissioner in this behalf, on payment of the duty of excise leviable on such excisable goods under section 3 of the Central Excises Salt Act, 1944 (1 of 1944): Provided that the quantity of the excisable goods, so allowed to be taken outside the Zone to any other place in India for the purposes of display as samples together with the quantity of excisable goods allowed to be taken outside the Zone to any other place in India for the purpose of sale under, and in accordance with, the Import and Export Policy of the Government of India for the time being in force, in respect of any unit in the Zone shall not, in any financial year, exceed the limit specified in the said Import and Export Policy for the purposes of such sale; (c) in the case of units engaged in the development of computer software, the exemption contained herein shall also apply to goods imported by such unit for the development of software for export and for providing consultancy services for development of software 'on site' abroad : Provided that (i) the conditions stipulated in this notification are complied with by such software development unit; and (ii) the procedure specified by the Collector of Customs is followed. Explanation. - The consultancy fees received by a software development unit in convertible foreign currencies for consultancy services for development of software 'on site' abroad shall be deemed to be export for the purposes of fulfilment of export obligation under this notification. 5. For the purposes of this notification, the Zone shall comprise of the places bearing the survey numbers and enclosed by the boundaries specified below :- Khasra/Survey numbers: Duvvada Village : 138 Part; 139 Part. Kurmannapalem Village : 1, 3, 4. Jaggarajupeta Village of Gajuwaka Mandal: 2 Part, 3, 124 34 Part, 35, 36, 37 and 38 Part. Vishakapatnam District of Andhra Pradesh lying at a distance of 24 Kms from the Port of Vishakapatnam and 15 Kms from the Vishakapatnam Airport; enclosed by 3.0 to 3.20 metre high boundary wall with 1.20 metre arm length Y-angle barbed wire. Northern side: Reserve Forest and Hill Porimboke North East: Phase II balance lands of Vishakapatnam Export Processing Zone South South East: Jaggarajupeta private dry lands Southern side: Howrah-Madras double lane Railway Track South West West: Phase I balance Vishakapatnam Export Processing Zone lands proposed Administrative building and housing North West: Phase I balance Vishakapatnam Export Processing Zone lands proposed for residential quarters. THE ANNEXURE Sl. No. Description of Goods (1) (2) 1. Machinery. 2. Raw Materials. 3. Components. 4. Spare parts of machinery. 5. Consumables. 6. Packaging materials. 7. Office equipments, spares and consumables thereof. 8. Goods re-imported within one year from the date of exportation from the Zone due to the failure of the foreign buyer to take delivery. 9. Tools, Jigs, gauges, fixtures, moulds, dies, instruments and acces sories. 10. Prototypes, technical and trade samples for development and diversification. 11. Drawings, blue prints and charts. 12. Goods received for repairs or re-conditioning within three years of the date of exportation for export after repairs or re-conditioning. 13. Material handling equipments, namely, fork-lifts, overhead cranes, mobile cranes, crawler cranes, hoists and stackers.