Notification No. 126 dated 3rd
June 1994 (As
amended by notification nos. 83/95, 117/95, 171/95, 67/96, 12/98, 38/98, 65/99,
9/00, 71/2000, 56/2001, Notification No. 64 dated 24th June 2002)
In
exercise of the powers conferred by sub-section (1) of section 25 of the
Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it
is necessary in the public interest so to do, hereby exempts goods specified in
Annexure-I to this notification (hereinafter referred to as the goods), when
imported into India, or procured from a Public Warehouse or a Private Warehouse
appointed or licensed, as the case may be, under section 57 or section 58 of
the said Customs Act, or procured from international exhibitions held in
India, for the
production or manufacture of articles specified in Annexure-II for export out
of India or for being used in connection with the production, manufacture or
packaging of the said articles specified in Annexure-II for export out of India
(hereinafter referred to as the specified purpose) by hundred percent export
oriented undertakings approved by the Board of Approvals for hundred percent
Export Oriented Undertakings, appointed by the notification of the Government
of India in the former Ministry of Industry and Civil Supplies (Department of
Industrial Development) No. S.O. 163(E)/RLIU/10(2) 76, dated the 3rd
March, 1976, or the Development Commissioner concerned as the case may be from
the whole of the duty of customs leviable thereon under the First Schedule to
the Customs Tariff Act, 1975 (51 of 1975) and the additional duty, if any,
leviable thereon under section 3 of the second mentioned Act, subject to the
following conditions, namely: -
(1)��������� the
importer has been granted the necessary licence for the import of the said
goods;
(2)��������� the
importer, at the time of import of the said goods, produces to the Assistant
Commissioner of Customs a certificate from the Development Commissioner to the
effect that the importer has executed a bond in such form and for such sum as
may be prescribed binding himself -
(a) to bring the said goods into his unit and to use them
for the specified purpose; and
(b) to dispose of the said goods or the articles produced,
manufactured or packaged in the unit or the waste, scrap, or remnants arising
out of such production, manufacture or packaging in the manner as may, if any,
be prescribed in the Export Import Policy and in this notification;
(3)��������� the
importer at the time of import or procurement of said goods executes a bond in
such form and for such sum as may be prescribed by the Assistant Commissioner
of Customs binding himself:-
(a) to produce a
certificate from the Assistant Commissioner of Central Excise, having
jurisdiction over his unit, certifying receipt of the said goods in the unit as
having been entered in the records prescribed for this purpose.
(b) to fulfil the Export Obligation and comply with the
conditions stipulated in this notification and Export and Import Policy, and to
pay on demand an amount equal to the duty leviable on the goods and interest at
the rate of fifteen percent per annum on the said duty from the date of duty
free importation or procurement of the said goods till the date of payment of
such duty, if-
(i) in the case of capital goods, such goods are not proved
to the satisfaction of the Assistant Commissioner of Customs to have been
installed or otherwise used within the bonded premises or re-exported within a
period of one year from the date of importation or procurement thereof or
within such extended period not exceeding five years as the Assistant
Commissioner of Customs may, on being satisfied that there is sufficient cause
for not using them as above within the said period, allow;
(ii) in the case of goods other than capital goods, such
goods are not proved to the satisfaction of the Assistant Commissioner of
customs to have been used in connection with the production or packaging of
goods for export out of India or re-exported within a period of one year from
the date of importation or procurement thereof or within such extended period
as the Assistant Commissioner of Customs may, on being satisfied that there is
sufficient cause for not using them as above within a said period allow;
(iii) in the case of-
(a) goods as produced or packaged, such goods have not been
exported out of India, and-
(b) unused goods (including containers, suitable for
repeated use) as have not been exported,
within a period of one year from the date of importation or
procurement of such goods or within such extended period as the Assistant
Commissioner of Customs may, on being satisfied that there is sufficient cause
for not exporting such goods within the said period, allow;
(iv) in the case of raw materials, components, spares and
consumables (other than capital goods) imported or procured duty free, the unit
fails to achieve Net Foreign Exchange Earning as a Percentage of Exports (NFEP)
and Export Performance (EP) as specified in Appendix-1 of the Export and Import
Policy, within one year of importation or procurement of such goods or within
such extended period, not exceeding one year, as the Assistant Commissioner of
Customs may, on being satisfied that there is sufficient cause, allow;
Provided that the Commissioner of Customs may extend the period for
achievement of Net Foreign Exchange as a Percentage of Exports (NFEP) or Export
Performance (EP) for further period not exceeding five years from the date of
importation or procurements;
(4)��������� the
importer uses the goods for the production, manufacturer or packaging of
articles and exports out of India hundred per cent or such other percentage, as
may be fixed by the said� Board of
Approvals for a period of 10 years or such extended period as may be specified
by the said Board;
(5)��������� the
importer shall maintain a proper account of import, consumption and utilisation
of the said goods and of exports made by him, and shall submit such account
periodically to the Development Commissioner in such form and in such manner as
may be laid down by the said Development Commissioner;
(6)��������� the
Assistant Commissioner of Customs may, subject to such conditions and
limitations as may be imposed by him and subject to the provisions of the
Export Import Policy-
(a) allow a unit to re-export the said goods;
(b) permit the said goods or goods produced, manufactured or
packaged in the unit to be taken out temporarily without payment of duty for
repairs, processing, testing or display and to be returned to the unit
thereafter; and
(c) permit the capital goods or goods produced,
manufactured or packaged to be supplied/ transferred without payment of duty
from the unit to another hundred per cent Export Oriented Undertaking or to a
unit in an Export Processing Zone or Special Economic Zone for use in the unit.
(d) permit destruction of the capital goods without payment
of duty within the unit, or outside the said unit, where it is not possible or
permissible to destroy the same within the said unit, in the presence of custom
officer;
(e) permit destruction of rejects and waste without payment
of duty within the unit, or outside the said unit, where it is not possible or
permissible to destroy the same within the said unit, in the presence of Customs
or Central Excise officer.
2.������� Without prejudice to any other
provisions contained in this notification, the Assistant Commissioner of
Customs may, subject to such conditions and limitations as he may deem fit to
impose under the circumstances of the case for the proper safeguard of the
revenue interest and also subject to such permission of the Development
Commissioner or Board of Approvals where it is exclusively required under the
Export and Import Policy, allow the said unit to clear any of the said goods
for being taken to any other place in India in accordance with the
Export-Import Policy.
(a)��������� Such clearance of capital goods and office equipments may
be allowed on payment of an amount equal to the customs duty leviable on such
goods on the depreciated value thereof and at the rate in force on the date of
payment of such duty;
(b)��������� Such
clearance of goods (including containers suitable for repeated use) other than
those specified in clause (a), may be allowed on payment of customs duty on the
value at the time of import and at rates in force on the date of payment of
such customs duty;
(c)���������� Such
clearance of used packing materials such as cardboard boxes, polyethylene bags
of a kind unsuitable for repeated use may be allowed without payment of any customs
duty.
Provided that the importer shall not be eligible to avail of the
exemption applicable to goods falling under heading number 98.01 of the First
Schedule to the Customs Tariff Act, 1975 (51 of 1975), or the exemption
available to the imported goods under any Export Promotion Capital Goods scheme
permitting import of capital goods at the rate of duty of 5% ad valorem
in terms of notification No. 160/92-Customs, dated the 20th April,
1992.
Explanation: The depreciation in respect of
goods covered by clause (a) shall be allowed for the period from the date of
commencement of commercial production of the unit or where such goods have been
imported after such commencement from the date such goods have come into use
for commercial production, upto the date of payment of duty.
3.������� Notwithstanding anything contained in
this notification, the exemption contained herein shall also apply to -
(a)��������� the said
goods which on importation into India are used; and for the purposes of
production, manufacture or packaging of articles and such articles (including
rejects, waste and scrap material arising in the course of production,
manufacture or packaging of such articles) even if not exported out of India
are allowed to be sold in India under and in accordance with the Export-Import
Policy and in such quantity and subject to such other limitations and
conditions as may be specified in this behalf by the Development Commissioner,
on payment of duty of excise leviable thereon under section 3 of the Central
Excise and Salt Act, 1944 (1 of 1944) or where such articles (including
rejects, waste and scrap material) are not excisable, customs duty equal in
amount to that leviable on inputs obtained under this notification and used for
the purpose of production, manufacture or packaging of such articles, which
would have been paid, but for the exemption under this notification, shall be
payable at the time of clearance of such articles.
(b)��������� the
indigenously procured fruits and vegetables cleared into Domestic Tariff Area
without payment of duty by the importer under intimation to the Assistant
Commissioner of Customs.
4.������� Notwithstanding
anything contained in this notification, the Assistant Commissioner of Customs
or Deputy Commissioner of Customs, as the case may be, may permit the seeds
specified in Item number 2 and the goods specified against Item number 6 and
Item numbers 16 to 22 of Annexure-I, to be taken out to the fields /farms of
contract farmers of the unit for production or in connection therewith; and to
bring back the produce to the unit for exports, in accordance with provisions
of Export and Import Policy and Handbook of Procedures, Volume-I and subject to
the following conditions, namely: -
(a)������ the unit shall produce an agreement between the unit and
contract farmer(s) to the Assistant Commissioner of Customs or Deputy
Commissioner of Customs, as the case may be;
(b)������ the fields/ farms of the contract farmers shall be located
within the jurisdiction of the same Commissioner of Customs or Commissioner of
Central Excise, as the case may be, as that of the unit;
(c)������ in case of units, which has been in existence for at least two
years and engaged in export of agriculture or horticulture products, supply of
inputs and other equipment to the fields/ farms of the contract farmers shall
be allowed to the unit on furnishing a bank guarantee equal to the 50 percent
of the duty forgone on the goods so transferred to the fields/farms of the
contract farmers;
(d)������ in case of units other than those specified in clause (c), the
unit shall be required to furnish a bank guarantee equal to the total duty
forgone on the goods so transferred to the fields/ farms of contract farmers;
(e)������ prior to import of the goods, the unit shall apply to the
Assistant Commissioner of Customs or Deputy Commissioner of Customs, as the
case may be, giving the details, such as, number of contact farmers and
location of their farms, measurement of the farms or fields under contact
farming, input-output norms of production as fixed by Directorate General of
Foreign Trade and their projected requirements and after examination of the
such projected requirement, the Assistant Commissioner of Customs or Deputy
Commissioner of Customs, as the case may be, would give permission for the
import or procurement of the same on annual basis;
(f)������� the
unit shall be required to have a premise(s) duly bonded under section 58 of the
said Customs Act for storage, of imported or domestically procured inputs and
capital goods and, of final products manufactured or produced therefrom;
(g)������ in case of failure of the unit to bring back the agriculture
or horticulture produce so produced in the fields/ farms of contract farmers to
the unit, as per the norms notified by the Directorate General of Foreign
Trade, within the same season or such extended period as may be permitted by
the Commissioner of Customs or Central Excise, as the case may be, due to any
reason including natural calamity or loss of crop, the unit shall be required
to pay the duty equal to the duty forgone on the inputs so taken out to the
fields/ farms of the contract farmers;
(h)������ in respect of goods specified at Item numbers 16 to 22 of
Annexure-I and transferred to the fields/ farms of the contract farmers, at any
point of time as may be decided by the Assistant Commissioner of Customs or
Deputy Commissioner of Customs, as the case may be, the unit shall be required
to account for the goods so transferred to the farms/ fields of the contact
farmers;
(i)������� in case of non-accountal of goods so transferred or use of
the goods in farms or fields other than those declared to the Assistant
Commissioner of Customs or Deputy Commissioner of Customs, as the case may be,
the unit shall pay duty forgone on such un-accounted goods along with the
interest at the rate of twenty percent per annum within 10 days of receipt of
demand notice, and in case of failure to pay the same, the Assistant
Commissioner of Customs or Deputy Commissioner of Customs, as the case may be,
may en-cash the bank guarantee and disallow the duty free imports/ procurement
under the notification.
Explanation: For the purposes of this
notification, -
(i) "Export-Import
Policy" means the Export and Import Policy 1st April, 2002-31st
March 2007 published by the Government of India in the Ministry of Commerce and
Industry vide Notification No. 1/ 2002-07, dated 31st March 2002, as
amended from time to time.
(ii) "Handbook of
Procedures Volume I" means the Handbook of Procedures Volume I, 2002-2007
published by the Government of India in the Ministry of Commerce and Industry
vide Public Notice No. 1/ 2002-07, dated the 31st March 2002.
ANNEXURE I
1.
Green house equipment, accessories, heated rooting tables, propagation trays,
seeding machines
2.
Plants or parts thereof, seeds, saplings, tubers, bulbs, Rhizomes, roots,
cuttings, all types of grafts, tissue culture material, and other vegetatively
propagated material utilised for sowing or planting
3.
Live animal such as pure livestocks (other than grand parent stock and parent
stock), used for breeding or rearing purposes, other than horses
4.
Growing media such as Peat Moss (including peat litres) (whether or not
agglomerated), Pearlite/ Vermiculate, Rockwool, Cocoa peat, Hydrocorn, Foam
based medium and other cultivation medium
5.
Office equipments, spares, and consumables thereof
6.
Fertilizers and chemicals for pre and post harvest treatments such as micro nutrients,
plant and growth regulators and other organic and inorganic substances used for
plant nutrition, insecticides, fungicides, weedicides, herbicides, and the like
7.
Animal feed such as cattle feed and poultry feed
8.
Veterinary medicines including vaccines
9.
Packaging materials including machinery and equipment for packaging
10.
Cooling equipment for cold room, storage room, pre-cooling chambers and its
accessories
11.
Sorting equipment, grading equipment, packing equipment and temperature control
or humidity control equipment
12.
Power generating sets
13.
Refrigeration and air-conditioning equipment for fitment on transport vehicles
14.
Spare parts for the maintenance of goods mentioned at item No. 10 to 13 above
15.
High Speed Diesel for power generating sets as recommended by the Board of
Approvals.
16.
Filters
17.
Dripliers, Driplines and Drip-fittings
18. Micro
Sprinklers and Misters
19.
Agriculture Sprinklers
20.
Fertilizer Tanks
21. Valves
22. Fertilizer
Pumps and Chemical Injections
ANNEXURE II
1.
Live animals falling under Chapter-1
2.
Bird�s eggs (fresh) in shells of Heading 04.07
3.
Live trees and other plants; bulbs, roots and the like, cut flowers and
ornamental foliage of Chapter 6
4.
Fresh vegetables of Headings 7.01 to 7.09; whole uncut sun dried vegetables of
Headings 7.12 and 7.13; Fresh and uncut/ sun dried roots and tubers of Heading
7.14
5.
Fresh and uncut/ sun dried edible fruits and nuts of Headings 8.01 to 8.10
6.
Fresh or sun dried plants and parts of plants of heading 12.11
7.
Silk worm cocoons of heading 50.01and raw silk of heading 50.02
8. Omitted
Note: The Chapters and Headings referred
to in the Annexure are those of the First Schedule to the Customs Tariff Act,
1975 (51 of 1975).