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Export Against Supply by Foreign Buyer � Clarification Regarding the
Amount of Bank Guarantee to be Furnished under the Scheme
Customs
Circular No. 36 dated 28th June 2002
I
am directed to invite your attention to notification No. 56/ 2000-Cus, dated
5.5.2000, which allows nominated agencies and status holder exporters etc to
import gold/ silver/ platinum etc. without payment of duty under the scheme
�Export Against Supply by Foreign Buyer� for the purpose of manufacture of
jewellery and export. The said notification provides, inter alia, that in the
case of import by status holder exporters and exporters of three years standing,
the importers are required to furnished a bank guarantee for a sum equivalent to
one and half times the customs duty leviable on the goods being imported.
2.
It has been brought to the notice of the Board by the Gem and Jewellery
Export Promotion Council that the importers are being asked to furnish bank
guarantee on the basis of tariff rate of duty to gold, and not on the basis of
effective rate of duty on gold when imported by nominated agencies. It has been
pointed out that calculation of bank guarantee amount on the basis of tariff
rate of duty adds to the transaction cost of exports and blocks huge funds. The
Council has, therefore, requested that the bank guarantee should be worked out
taking the duty on gold at the rate of Rs. 250/- per 10 gms i.e. the rate of
duty as applicable to nominated agencies under notification No. 80/97-Cus, dated
the 21.10.97.
3.
The matter has been examined. At present, the nominated agencies and
authorized banks are allowed to import gold on payment of duty @ Rs. 250/- per
10 gms under notification No. 80/97-Cus, dated 21.10.97. It is noted that the
bulk of the import of gold is through the nominated agencies and banks only.
Therefore, to bring down the transaction cost of exports, it has been decided
that for the purpose of calculation of bank guarantee amount in case of import
of gold under the said Scheme, the duty rate on gold will be taken @ 250/- per
10 gms.
4.
Wide publicity may be given by issue of a Public Notice in this regard.
5.
Difficulties, if any, faced in the implementation of above instructions,
may be brought to the notice of the Board at an early date.
Kindly
acknowledge receipt of this Circular.
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