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FORM-ARE-3

KRK1974 (FC) (53 Points)

17 September 2009

Hi,

Can anyone briefly explaim when FORM-ARE 3 is used.

Thanks in advance

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8 Replies

CA LOVELY ARORA (C.A. B.Com (H) Graduate) (2151 Points)
Replied 17 September 2009

Form ARE-3 :-

Application form for central excise registration of manufacturers of hand rolled cheroots of tobacco falling under sub-heading no. 2402.00 of central excise tariff act, 1985.

You may refer CBEC site :- www.cbec.gov.in for further details.

The link is given as :- https://www.cbec.gov.in/excise/cx-forms/a-3.pdf

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Arti (Jr Manager) (123 Points)
Replied 17 September 2009

Form ARE 3 used for removal of goods from a factory or a warehouse to another warehouse. Also know for export warehousing.

KRK1974 (FC) (53 Points)
Replied 17 September 2009

Thanks a ton for the reply. I am bit confused with export warehouse. For example if a get a sales order from customer who inturn exports the same. If this is the case should our sales invoice accompany the form-ARE 3 and we should not charge any excise duty on our sales invoice?

Am i correct.

T L RAVINDRA BHATT (CHARTERED ACCOUNTANT) (23 Points)
Replied 05 May 2014

ARE 1, 2 AND 3 are related to applications for removal of goods under Central excise for availing exemption. ARE 3 referred to applications for removal of Goods under central excise for availing exemption for dispatching goods to EOU etc against Form CT3 you can refer the following circular for understanding the procedure better:-

F.No.DGEP/EOU/401/2006

Govt. of India,

Ministry of Finance

Department of Revenue

Central Board of Excise & Customs

Directorate General of Export Promotion

New Delhi, the 3rd May, 2007

Sub: Procedure governing the movement of indigenous goods from a factory of manufacture or warehouse to a unit set up under EOU/EHTP/STP/BTP scheme.

In exercise of powers conferred under sub-rule (2) of Rule 20 of the Central Excise Rules, 2002, the Central Board of Excise and Customs (hereinafter referred to as the “Board”) specifies the following conditions, limitations, safeguards and procedures for removal of goods by the manufacturer directly from the factory of production or by the registered person of the warehouse (hereinafter referred to as the “Consignor”) without payment of duty to a unit set up under EOU/EHTP/STP/BTP scheme (hereinafter referred to as the “user industry”) eligible to procure the goods under Notification No. 22/2003-CE, dated 31st March, 2003 as amended from time to time (hereinafter referred to as the “notification”).

1. Eligibility for warehousingThe facility of warehousing goods shall be extended to such user industry who have a valid Letter of Permission/Letter of Intent issued by the Development Commissioner to establish a 100% EOU, and who have been granted license under Section 58 of the Customs Act, 1962 and sanction under Section 65 of the Customs Act, 1962 for the purposes specified in clauses (a) to (e) to the notification.

2. Application to obtain benefit of duty free exemption

(a) A user industry who intends to procure goods for specified purpose without payment of duty under the notification shall make an application to the proper officer as per existing instructions of the Board issued from time to time for issuing C.T.-3 by the jurisdictional Superintendent or Asstt./Dy. Commissioner of Customs and Central Excise, as the case may be. Such an application shall contain details like particulars of license issued under Section 58 and 65 of the Customs Act, 1962 to the user industry, full descripttion of goods, Central Excise Tariff sub-heading, quantity required, value of the goods, estimated duty leviable, purpose for which these goods are required, manner of usage of these goods, name and address of the consignor, name and address of office of the Superintendent in-charge and jurisdictional Asstt/Dy.Commissioner of Customs or Central Excise of the factory or warehouse of consignor. The user industry shall submit a declaration that the particulars furnished in the application are true and correct to the best of their knowledge and belief and shall also give an undertaking that goods intended to be procured duty free will be used for the purpose mentioned in the application.

(b) The proper officer shall ensure that there is sufficient balance in the bond executed by the user industry to cover the central excise duty on the goods. After due diligence, the proper officer shall issue a certificate in Form C.T.-3 annexed to the notification as Annexure-VI in quadruplicate. One copy of C.T.-3 shall be forwarded to the jurisdictional Range Superintendent in-charge of the factory or warehouse of the consignor, two copies shall be handed over to the user industry and one copy shall be retained for office records.

(c) The user industry will forward one copy to the factory or warehouse of the consignor from where they intend to procure goods without payment of duty and retain one copy for their record. On the basis of this certificate, the consignor shall avail benefit of the notification.

3. Procedure in respect of goods removed from a factory or a warehouse.

The consignor shall prepare an application for removal of goods from his factory or warehouse to user industry in quadruplicate in the form (ARE-3) annexed to this circular as Annexure-A.
The consignor shall also prepare an invoice in the manner specified in Rule 11 of the Central Excise Rules, 2002 in respect of the goods intended to be removed from his factory or warehouse.
The consignor shall send the original, duplicate and triplicate copies of application (ARE-3) and duplicate copy of invoice along with the goods to the user industry.
The consignor shall send quadruplicate copy of the application to the Superintendent-in-charge of his factory or warehouse within twenty-four hours of removal of the consignment.
On arrival of the goods at the premises of user industry, the user industry shall verify the number/quantity/weight/descripttion/value/duty etc. with the contents mentioned in the application and invoice and make entry in the account/register maintained for this purpose containing information relating to details of ARE-3 and invoice, date of receipt, descripttion of goods received including marks and number, quantity, value, rate and amount of duty etc. The user industry shall endorse a certificate of warehousing on the application ARE-3. Thereupon an intimation regarding arrival of the goods with all three copies of the application (ARE-3) duly endorsed by the user industry shall be sent to the Superintendent-in-charge of the user industry. All goods received into the premises of user industry shall be kept separate from other goods until such goods are warehoused.
The Superintendent-in-charge of the user industry shall depute a bond officer to examine the goods on the same day of receipt of information regarding goods arrival. The bond officer shall conduct physical verification of the goods within 24 hrs of receipt of intimation regarding arrival of goods. After verification, these goods shall be warehoused and entry in the account/register shall be countersigned by the bond officer. The bond officer shall submit a report to the Superintendent-in-charge who shall counter sign the certificate of warehousing on all copies of the application.
The Superintendent-in-charge of the user industry shall send original copy of ARE-3 to Superintendent-in-charge of the consignor, duplicate copy to the consignor and triplicate copy to the user industry for record. A photo copy of the original copy of ARE-3 will be kept in the office for records.

4. Failure to receive a warehousing certificate

The consignor should receive the duplicate copy of application (ARE-3) with certificate of warehousing, duly endorsed by the user industry and counter signed by the Superintendent-in-charge of the user industry, within ninety days of the removal of the goods. If the warehousing certificate is not received within ninety days of the removal, the consignor shall intimate the Superintendent-in-charge of his factory or warehouse.
If the Superintendent-in-charge of the consignor of the goods does not receive the original copy application (ARE-3) with certificate of warehousing, duly endorsed by the user industry and countersigned by the Superintendent-in-charge of the user industry, within ninety days of the removal of the goods, weekly reminders must be issued by him to the Superintendent-in-charge of the user industry. If despite such reminders, the original warehousing certificate is not received within a further period of sixty days of the expiry of the ninety days period, the Superintendent-in-charge of the consignor shall inform his Assistant/Deputy Commissioner who shall either secure a satisfactory proof of the goods having been duly received by the user industry or ensure that the duty of excise due on the goods not received at destination is recovered from the consignor in terms of Rule 20 (4) of

the Central Excise Rules, 2002.

5. Accountal of goods in the user industry

The user industry shall maintain account/register showing all entries of goods received into his unit and its consumption or removal, containing information relating to details of ARE-3, invoice, date of receipt and warehousing, descripttion of goods received including marks and number, quantity, value, rate and amount of duty etc. and the quantity remaining in stock. The user industry shall submit a monthly return in the form E.R.-2 as prescribed by the Board under Rule 17 (3) of the Central Excise Rules, 2002 and Rule 9 (7) of the CENVAT Credit Rules, 2004 to the Superintendent-in-charge of his unit by 10th of the following month.

Responsibility of the user industry
The user industry shall be responsible for due receipt of the goods into its unit and delivery therefrom including their safety during the period they are lodged in the premises of the user industry.
The user industry shall be responsible for the payment of duty, penalty or interest leviable in respect of the goods which are warehoused but not used for intended purpose as provided under the notification No. 22/2003-CE dated 31.03.2003 as amended, Central Excise Act and the rules made thereunder and instruction issued by the Board from time to time.

7. Goods not to be taken out except as provided

The goods received in the user industry’s premises shall not be taken out except as provided under the notification.

8. Period of warehousing

(a) The goods received in the user industry’s premises may remain in the premises of user industry, till the expiry of five years from the date on which such goods were warehoused in case of capital goods and three years in case of goods other than capital goods.

(b)

(c)

9. These instructions shall come into force with immediate effect.

10. Trade and field formations may be informed accordingly.

(F.No.DGEP/EOU/401/2006)

(Pawan Kumar Jain)
Addl. Director General (EP)

ANNEXURE- A

Original/Duplicate/Triplicate/Quadruplicate
Range................................................
Division..............................................

No………………………

Application for removal of goods from a factory or a warehouse to another warehouse

(A.R.E. 3)

I/We holder(s) of Central Excise Registration No......................................have undertaken to remove the under mentioned goods from the factory/warehouse at............................................. to the user industry at ........................................... in Range............................. Division........................................... of Mr./Messrs.................................................................................. holders of Central Excise Registration No. ..............................................................

Number and date of entry in wareh ouse register	Descri- ption of goods	No. and descri- ption of pack- ages	Gross weight of pack- ages	Marks and num- bers on pack- ages	Quan- tity of goods	Date of first ware- housing	Value	Duty		No. & date of invoice(s) for re- moval of goods	Manner of trans- port	Re- marks
								Rate	Amount
1	2	3	4	5	6	7	8	9	10	11	12	13

I/We hereby declare the above particulars to be true.
Place ....................
Date ..................... Signature of consignor(s) or his/their authorized agent.

Certificate of warehousing by the consignee

I/We hereby certify that the consignment arrived at.........................................on..............................that the goods conform in all respects to the descripttion given overleaf except for the following discrepancies, and that they have been warehoused under Entry

No. ...........................of the register maintained in the warehouse.

Particulars of discrepancies

No. and descripttion of packages not received	Quantity short received	Duty payable on the shortage	Remarks
1	2	3	4

Place....................
Date ....................

Signature of consignee(s) or his/their authorized agent.

Regards

CA.Ravindra Bhatt T L

MAHESH DASAPPA (Accounts officer) (34 Points)
Replied 14 May 2014

Hi,

Can any body I have a bit confusion, I have to Sale the manufactured items to an SEZ unit in chennai who is asking to send the material without excise duty agaist ARE1 and without CST against Form I issued by the party. Can anybody solve this problem. How to send the material without duty & cst. What all procedure do i need to maintain.

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satya (Executive Excise) (1839 Points)
Replied 17 December 2015

Dear Mahesh,

Material sales to SEZ unit (just like Export), you have to make Rule 11 Invoice w/o Duties & VAT, ARE1 (5 copies) mentioned their SEZ Registration etc details .

after receipt of material party(their Excise official) will certify the receipt on your ARE1 copies. (with in 45 days). you have to submit these copies along with Annex-19 monthly statement as Proof of Exports.

satya (Executive Excise) (1839 Points)
Replied 17 December 2015

for more details;

pl refer chapter 7

https://dgft.gov.in/exim/2000/policy/pol05/chap-7.htm


Export and Import of Goods.	7.2	(a)	SEZ units may export goods and services including agro-products, partly processed goods, sub-assemblies and components except prohibited items of exports in ITC (HS). The units may also export by-products, rejects, waste scrap arising out of the production process. Export of Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) shall be subject to fulfillment of the conditions indicated in the ITC (HS) Classification of Export and Import Items. SEZ units, other than trading/service units, may also export to Russian Federation in Indian Rupees against repayment of State Credit/Escrow Rupee Account of the buyer, subject to RBI clearance, if any.
		(b)	SEZ unit may import/procure from the DTA without payment of duty all types of goods and services, including capital goods, whether new or second hand, required by it for its activities or in connection therewith, provided they are not prohibited items of imports in the ITC(HS). However, any permission required for import under any other law shall be applicable. Goods shall include raw material for making capital goods for use within the unit. The units shall also be permitted to import goods required for the approved activity, including capital goods, free of cost or on loan from clients.
		(c)	SEZ units may procure goods required by it without payment of duty, from bonded warehouses in the DTA set up under the Policy and/or under Section 65 of the Customs Act and from International Exhibitions held in India.
		(d)	SEZ units, may import/procure from DTA, without payment of duty, all types of goods for creating a central facility for use by units in SEZ. The Central facility for software development can also be accessed by units in the DTA for export of software.
		(e)	Gem & Jewellery units may also source gold/ silver/ platinum through the nominated agencies.
		(f)	SEZ units may import/procure goods and services from DTA without payment of duty for setting up, operation and maintenance of units in the Zone.