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Regarding Transfer of Unutilised Raw Material from one <a href='http://www.eximguru.com/exim/eou/default.aspx'>EOU</a>/ EPZ/ STP/
EHTP Unit to another EOU/ EPZ/ STP/ EHTP Unit under Paragraph 6.16 of the Policy
Customs
Circular No. 91 dated 20th December 2002
It
has been brought to the notice of the Board that the EOUs and units in EPZ/ EHTP/
STP are not being allowed to transfer unutilised materials procured/ imported
duty free to other such unit in spite of explicit provision contained in
Paragraph 6.16 of the Exim Policy. The permission is stated to have been denied
on the ground that inter unit transfer of goods except within the same EPZ is
not allowed under the Exim Policy 2002-2007.
2. The matter has been examined by the
Board. It may be noted that the facility of inter-unit transfer of goods under
EOU/EPZ/STP/EHTP Scheme has been restricted to manufactured goods only under
paragraph 6.14 of the Exim Policy 2002-2007. Such inter-unit transfer of goods
is different from the transfer of unutilised duty free goods allowed under
paragraph 6.16 of the Exim Policy. Paragraph 6.16 of Exim Policy explicitly
provides that in case an EOU/ EPZ/ EHTP/ STP unit is unable, for valid reasons,
to utilise the goods imported or procured from DTA, it may dispose off them in
DTA on payment of applicable duties and on submission of import licence by the
DTA unit, wherever applicable. The paragraph also permits transfer or sale of
goods from an EOU/ EPZ/ EHTP/ STP unit to another such unit. A plain reading of
the paragraph makes it clear that sale of unutilised material to a DTA unit or
to another EOU/ EPZ/ EHTP/ STP unit can arise only in exceptional cases and can
not be a regular feature for the units. Such sale of un-utilised goods is
obviously different from inter-unit transfer of goods in normal course under
paragraph 6.16, which has been restricted to manufactured goods only.
3. In view of the above, I am directed to
say that in case the EOUs or units in EPZ/ EHTP/ STP are unable, for valid
reasons, to utilise the goods imported or procured duty free, such unutilised
goods may be allowed to be sold in DTA on full payment of duty or may be allowed
to be transferred to other EOUs/ EPZ/ EHTP/ STP units under and in accordance
with paragraph 6.16 of the Exim Policy. However, in such cases, the unit should
give valid reasons for such transfer/ sale of un-utilised materials. Such supply
from one EOU/ EPZ/ EHTP/ STP unit to another such unit shall be treated as
import for the recipient unit and necessary endorsement to this effect may be
made on all the documents pertaining to such inter-unit transfers.
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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