| Date: |
18-03-2003
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| Notification No: |
DGFT Policy Circular No 21/2003
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| Issuing Authority: |
DGFT
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| Type: |
Circular
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| File No: |
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| Subject: |
Retrospective Effect of the Criteria Permitting 25% BG for Manufacturer Exporters having an Export Turnover of less than Rs 1 Crore
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Retrospective Effect of the Criteria Permitting 25% BG for Manufacturer
Exporters having an Export Turnover of less than Rs 1 Crore
Policy
Circular No. 21 dated 18th March 2003
Attention
is invited to Public Notices No. 51 dated 04.12.2002 and No. 64 dated 19.02.2003
which amended para 4.6 of the Handbook of Procedures (Vol 1) pertaining to
�Newcomers�.
Specifically,
the amendment in PN 51 dated 04.12.2002 was about such manufacturer exporters
who had an export turnover of less than Rs 1 crore but were registered with the
state sales tax authorities. It was mandated that on production of a CA
certificate indicating the previous licencing years exports, a certificate of
registration with the state sales tax/ central excise authorities and a
declaration that they have not been penalised under the Customs Act, Excise Act,
Foreign Trade (Development and Regulation) Act, 1992 & FEMA/ FERA; such
manufacturer exporters may now furnish a Bank Guarantee (BG) to the tune of 25%
of the duties saved for the issuance of an Advance Licence.
On the other hand the amendment in PN 64 dated 19.02.2003 pertains to such
established domestic companies who fulfil certain specified criteria like being
registered with both the central excise and state sales tax authorities and
having paid both the taxes unless exempted and having a minimum investment in
plant and machinery of Rs 50 lakhs. The Advance Licence issued to such domestic
companies would carry an endorsement that the bond/ BG furnished would be as per
the terms and conditions stipulated by the Department of Revenue.
These
amendments were carried out to reduce the transaction cost especially for
established small exporters and established domestic companies. However, there
have been queries on the extension of such facilities to licences issued prior
to the issuance of these Public Notices.
It
has been decided that the facility granted under the two Public Notices would be
available to licences issued earlier as the provisions are aimed at the
reduction in the transaction costs of small exporters and established domestic
companies.
This
issues with the approval of the Director General of Foreign Trade.
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