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TMI BlogDUTY EXEMPTION & REMISSION SCHEMESX X X X Extracts X X X X X X X X Extracts X X X X ..... inputs covered by authorisation, plus any other imported materials used on which benefit of DBK is claimed. ADVANCE AUTHORISATION SCHEME Advance Authorisation 4.1.3 An Advance Authorisation is issued to allow duty free import of inputs, which are physically incorporated in export product (making normal allowance for wastage). In addition, fuel, oil, energy, catalysts which are consumed/ utilised to obtain export product, may also be allowed. DGFT, by means of Public Notice, may exclude any product(s) from purview of Advance Authorisation. Duty free import of mandatory spares upto 10% of CIF value of Authorisation which are required to be exported/ supplied with resultant product are allowed under Advance Authorisation. Advance Authorisations are issued for inputs and export items given under SION. These can also be issued on the basis of Adhoc norms or self declared norms as per para 4.7 of HBP v1. Advance Authorisation can be issued either to a manufacturer exporter or merchant exporter tied to supporting manufacturer(s) for: i) Physical exports (including exports to SEZ); and/ or ii) Intermediate supplies; and /or iii) Supply of goods to the categori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he manufacturing wastes/scrap, as allowed, can be disposed off with the payment of applicable duty before fulfilment of export obligation. 4.1.6 1 [ Advance Authorisation necessitates exports with a minimum value addition of 15%, except for items specified in Appendix 11B of HBP v1 and for items in Gems Jewellery Sector, for which value addition would be as per paragraph 4A.2.1 of HBP v1 . ] Exports to SEZ Units/ supplies to Developers / Co-Developers, irrespective of currency of realization, would also be covered. For physical exports for which payments are not received in freely convertible currency, same shall be subject to value addition as specified in Appendix-11 of HBP v1. In case of Authorisation for import of Tea, minimum value addition under Advance Authorisation shall be 50%. Similarly, in case of spices {covered by Chapter 9 of ITC(HS)}, duty free import of spices shall be permitted only for value addition purposes like crushing / grinding / sterilization or for manufacture of oils and oleoresins and not for simple cleaning, grading, re-packing etc. 4.1.7 Advance Authorisation shall be issued in accordance with Policy and procedure in force on Au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v1. Back-to-Back Inland Letter of Credit 4.1.12 Holder of Advance Authorisation, Advance Authorisation for Annual Requirement and DFIA may, instead of applying for an ARO or Invalidation letter, avail of the facility of Back-to-Back Inland Letter of Credit in accordance with procedure specified in HBP v1. Prohibited Items 4.1.13 Prohibited items of imports mentioned in ITC(HS) shall not be imported under Advance Authorisation / DFIA. Further items reserved for imports by STEs cannot be imported against Advance Authorisation / DFIA. However those items can be procured from STEs against ARO or Invalidation letter. STEs are also allowed to sell goods on High Sea Sale basis to holders of Advance Authorisation / DFIA holder. In addition, STEs are permitted to issue "No Objection Certificate (NOC)" for import by advance Authorisation/ DFIA holder. Authorisation Holder would be required to file Quarterly Returns of imports effected against such NOC to concerned STE and STE would submit half-yearly import figures of such imports to concerned administrative Department for monitoring with a copy endorsed to DGFT. Similarly prohibited items of exports mentioned in ITC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licable. Export Obligation 4.2.5 Procedure and time period related to fulfillment of Export Obligation have been laid down in Chapter 4 of HBP v1. Transferability 4.2.6 Once export obligation has been fulfilled, request for transferability of Authorisation or inputs imported against it may be made before concerned RA. Once, transferability is endorsed, Authorisation holder may transfer DFIA or duty free inputs, except fuel and any other item(s) notified by DGFT. However, for fuel, import entitlement may be transferred only to companies which have been granted authorisation to market fuel by Ministry of Petroleum and Natural Gas. Once transferability is endorsed, imports / domestic procurement against authorisation or transfer of imported inputs / domestically procured inputs shall be subject to payment of applicable additional customs duty / excise duty. While endorsing transferability, authorisation would bear a note as to liability of such additional customs duty / excise duty. However, in case where CENVAT facility has not been availed, exemption from additional customs duty/ excise duty would be available even after endorsement of transferability on DFIA. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder transitional facility, wherever allowed, in terms of paragraph 1.5 of FTP. 4.3.2 DEPB holder shall have option to pay additional customs duty in cash as well. Validity 4.3.3 Validity period of DEPB for import shall be as prescribed in HBP v1. Transferability 4.3.4 DEPB and / or items imported against it are freely transferable. Transfer of DEPB shall however be for import at specified port, which shall be the port from where exports have been made. Imports from a port other than the port of export shall be allowed under TRA facility as per terms and conditions of DoR notification. Applicability of Drawback 4.3.5 Additional customs duty / Excise Duty and Special Additional Duty paid in cash or through debit under DEPB may also be adjusted as CENVAT Credit or Duty Drawback as per DoR rules. GEMS AND JEWELLERY Scheme for Gems and Jewellery 4A Exporters of gems and Jewellery can import / procure duty free inputs for manufacturing. Replenishment Authorisation 4A.1 Exporters may obtain Replenishment (REP) Authorisations from RA in accordance with procedure specified in HBP v1. 4A.1. Replenishment authorisation may also be issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Platinum jewellery including partly processed jewellery and articles including medallions and coins (excluding legal tender coins and any engineering goods) containing more than 50% platinum by weight. Value Addition 4A.6 Value Addition (VA) for gems and jewellery sector shall be as per paragraph 4A.2.1 of HBP v1. It would be calculated as under: VA = A - B / B x 100, where A = FOB value of the export realised / FOR value of supply received. B = Value of inputs (including domestically procured) such as gold / silver / platinum content in export product plus admissible wastage along with value of other items such as gemstone etc. Wherever gold has been obtained on loan basis, value shall also include interest paid in free foreign exchange to foreign supplier. Wastage Norms 4A.7 Wastage or manufacturing loss for gold / silver / platinum jewellery shall be admissible as per paragraph 4A.2 of HBP v1. Export against Supply by Foreign Buyer 4A.8 Where export orders are placed on nominated agencies/ status holder / exporters of three years standing having an annual average turnover of Rs. Five Crores duri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of Branded Jewellery 4A.14 Nominated agencies and their associates, with the approval of Department of Commerce, and others, with the approval of Gem Jewellery EPC (GJEPC), may export gold / silver / platinum jewellery and articles thereof for exhibitions abroad. Personal carriage of gold / silver / platinum jewellery, precious, semi-precious stones, beads and articles and export of branded jewellery is also permitted, subject to conditions as in HBP v1. Personal Carriage of Export / Import Parcels 4A.15 Personal carriage of gems and jewellery export parcels by foreign bound passengers and import parcels by an Indian importer/foreign national may be permitted as in HBP v1. Export by Post 4A.16 In case of exports through Foreign Post Office (including via Speed Post), value of jewellery parcels shall not exceed US$ 75000 and 20 kg. by weight. Diamond Jewellery Dollar Accounts 4A.17 Firms and companies dealing in purchase/ sale of rough or cut and polished diamonds/precious metal jewellery plain, minakari and / or studded with / without diamond and/or other stones, with a track record of at least two years in import or export of diamonds / colour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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