RoMan (Assistant Clerk) (39 Points)
06 April 2010Following queries related to captioned subject (suggestions with reference to case laws / law provisions & notifications would be highly appreciated):-
1. Is it a requirement to import raw material first and then export goods under advance licence manufactured from same RM,
2. Can an entity fulfill all its export obligations and trade the Licence for import of RM, and
3. Guidance on Accountuing for Advance Licence and Export Benefits thereon.
regards,
RAMESH KUMAR VERMA
( CS PURSUING )
(43853 Points)
Replied 06 April 2010
MR. ROMAN,
Your query:-
AS PER FOREIGN TRADE POLICY, 2009-2014, PARA 4.1.4, actually, advance authorization / license / scrip are exempted from payment of basic custom duty, additional custom duty, education cess, antidumping duty, and safe guard duty, if any however import of supplies covered under paragraph 8.2 (h) & (1) will not be exempted from payment of applicable anti dumping and safe guard duty, if any (SUPPLY TO 100% EOU AND UN AGENCY)
Your query:-
2. CAN AN ENTITY FULFILL ALL ITS EXPORT OBLIGATIONS AND TRADE THE LICENCE FOR IMPORT OF RM, AND
Reply:-
AN ADVANCE AUTHORISATION IS ISSUED TO ALLOW DUTY FREE IMPORT OF INPUTS, WHICH ARE PHYSICALLY INCORPORATED IN EXPORT PRODUCT.
AS PER FOREIGN TRADE POLICY, 2009-2014,
HOWEVER, AUTHORISATION HOLDER WILL HAVE OPTION TO DISPOSE OFF PRODUCT MANUFACTUREED OUT OF DUTY FREE INPUTS ONCE EXPORT OBLIGATION IS COMPLETTED. IN CASE WHERE CENVAT CREDIT FACILITY ON INPUTS HAVE BEEN AVAILED FOR THE EXPORTED GOODS, EVEN AFTER COMPLETION OF EXPORT OBLIGATION THE GOODS IMPORTERD AGAINST ADVANCE AUTHORISATION SHALL BE UTILIZED ONLY IN THE MANUFACTURE OF DUTIABLE GOODS WHETHER WITHIN THE SAME FACTORY OR OUTSIDE (BY A SUPPORTING MANUFACTURER), FOR WHICH THE AUTHORISATION HOLDER SHALL PRODUCE A CERTIFICATE FROM EITHER THE JURISDICTIONAL CENTRAL EXCISE SUPERNTENDENT OR CHARTERED ACCOUNTANT , AT THE OPTION OF THE EXPORTER , AT THE TIME OF FILING APPLICATION FOR EXPORT OBLIGATION TO THE CONCERNED REAGIONAL AUTHORITY . HOWEVER THE ACTUAL USER CONDITION SHALL NOT BE APPLICABLE IN CASE OF RAW SUGAR TO BE IMPORTED FROM 17.02.2009, TILL 30.09.2009 UNDER ADVANCE AUTHORISATION SCHEME.”
AS PER FOREIGN TRADE POLICY, 2009-2014, PARA 4.1.14 “in case of an ADVANCE LICENCE , DRAWBACK SHALL BE AVAILABLE FOR ANY DUTY PAIS MATERIAL , WHETHER IMPORTED OR INDIGENIOUS USED IN THE GOODS EXPORTED AS PER DRAWBACK RATE FIXED BY THE DEPAQRTMENT OF REVENUE, MINISTRY OF FINANCE(DIRECTOR OF DRAWBACK)
AS PER HANDBOOK OF PROCEDURE VOL-1 2009-2014,
THE BANK GUARANTEE AND BOND IN LIEU, OF THE SAID ADVANCE LICENCE WILL BE CANCELLED BY CUSTOM AUTHORITY.
GUIDANCE ON ACCOUNTUING FOR ADVANCE LICENCE AND EXPORT BENEFITS THEREON.
AT THE TIME OF ACCOUNTING, DO CAREFULLY WHEN AVAILMENT OF CENVAT AND DUTYDRAWBACK AVAILMENT AND RECEIVING THE FOREIGN CURRENCY.
PREPARE AN APPENDIX-22A, VERIFY THE FOREIGN CURRENCY AND WHEN THIS MONEY RELEASED BY PARTY, ARRANGE THE VERIFICATION AND AUTHINICATION FROM YOUR BANKER. (EXPORT PHYSICAL)
PREPARE AN APPENDIX-22B VERIFY THE FOREIGN CURRENCY AND WHEN THIS MONEY RELEASED BY PARTY, ARRANGE THE VERIFICATION AND AUTHINICATION FROM YOUR BANKER. (100%EOU EXPORTS)
LIVE Course on Foreign Exchange Management Act (FEMA)(with recording)
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