Dgft- exim policy

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

18 February 2013 Dear All,

Need clarification on following matter

* if Exporter is not able to fulfill EO completely both in terms of value for advance authorization and paid penalty to custom authority though TR challan for duty saved amount along with applicable interest.

Whether DGFT can demand penalty for non fulfillment of EO in above case.

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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18 February 2013 when the EO fulfilled an exporter must submit the File for Redemption in prescribed Time period otherwise CUSTOM / CONCERNED RJDGFT office call the penalty for contravention in said case.

Regards

Querist : Anonymous

Querist : Anonymous (Querist)

18 February 2013 Dear Sir,

Thnx for the reply. But my query is still open.

I know that we have to pay duty saved amount along with applicable interest to customs. That exporter have already done.

But my question is that whether DGFT can demand such penalty even after payment to custom authority.

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RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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18 February 2013 actually licence issued by R.J.D.G.F.T. office Licence Registered by CUSTOM.

what should you go:

produce a copy alongwith intimation letter IN concerned regional licensing authority alongwith "tr-6 copy "submitted in custom.

eminent expert are also CMTS in this case......

regards,

Querist : Anonymous

Querist : Anonymous (Querist)

18 February 2013 Query is still open.

Not getting answer for asked query.

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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18 February 2013 actually licence issued by R.J.D.G.F.T. office Licence Registered by CUSTOM.

what should you go:

produce a copy alongwith intimation letter in this regards as well as TR-6 COPY submitted in custom.

eminent expert also CMTS...
Regards,

Querist : Anonymous

Querist : Anonymous (Querist)

18 February 2013 Thnx,

Need other expert view on this matter.

Still Query is opened. Not getting proper answer.

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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21 July 2024 In cases where an exporter is unable to fulfill the Export Obligation (EO) completely under an Advance Authorization and has already paid the penalty to the customs authority through a TR (Transfer of Residence) challan for the duty saved amount along with applicable interest, there are specific considerations regarding penalties from the Directorate General of Foreign Trade (DGFT). Here’s a clarification based on the typical practices and regulations:

### Understanding the Situation

1. **Advance Authorization (AA) and Export Obligation (EO)**:
- An AA allows duty-free import of raw materials, components, or capital goods.
- EO mandates the exporter to export a certain value of goods within a specified period.

2. **Non-Fulfillment and Penalties**:
- If an exporter fails to meet the EO, DGFT may impose penalties, which could be a percentage of the unmet export value.
- Interest on the duty saved amount is also applicable for the period of default.

3. **Customs and TR Challan**:
- The exporter paid the penalty and interest to customs through a TR challan, indicating payment of duty saved under the AA.

### DGFT’s Authority and Actions

- **Penalty from DGFT**: Yes, DGFT can still demand penalties for non-fulfillment of EO obligations, even if the customs duties (duty saved under AA) and interest have been paid.
- **Reasoning**: The payment made through the TR challan to customs addresses the duty aspect under the customs laws. However, EO obligations under the DGFT regulations are separate. DGFT can enforce penalties independently for not meeting these obligations.

### Key Considerations

- **Compliance with DGFT Regulations**: Exporters must comply with both customs and DGFT regulations separately. Payment of customs duty and penalties does not exempt them from EO obligations under DGFT rules.
- **Consultation and Documentation**: It’s advisable to consult with a DGFT consultant or a legal expert well-versed in international trade to understand specific regulations and potential penalties. Proper documentation of all transactions and communications with DGFT is crucial.

### Next Steps

1. **Review Regulations**: Carefully review the DGFT notifications and policies relevant to your specific case to understand the penalties and compliance requirements.

2. **Communication with DGFT**: If penalties are imposed or demanded by DGFT, ensure timely communication and compliance to avoid further consequences.

3. **Future Compliance Strategy**: Develop a robust compliance strategy to meet EO obligations under AA and avoid penalties in the future.

In summary, while the payment through TR challan addresses customs duties, DGFT can still demand penalties for non-fulfillment of EO obligations. Exporters should adhere to both customs and DGFT regulations and seek expert guidance as needed to navigate these requirements effectively.

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