DIRECTORATE GENERAL OF EXPORT PROMOTION
Ministry of Finance, Deptt. of Revenue
8th Floor, Tower-2, LIC, Jeevan Bharti Building
Connaught Place, New Delhi -110001
Tel: 23722439, Fax: 23722443
e-mail: [email protected]

Circular No. 23/2018-Customs

Dated: 23^rd July, 2018

To,

All Principal Chief Commissioners/ Chief Commissioners of Customs
All Principal Chief Commissioners(Prev.)/ Chief Commissioners of Customs(Prev.)

Subject: Procedure to be followed by nominated agencies importing gold/silver/ platinum under the scheme for ‘Export Against Supply by Nominated Agencies’-reg.

Sir/ Madam,

Circular no. 27/2016-Customs dated 10.06.2016 was issued providingfor a simplified procedure in view of non-applicability of warehousingprovisions to duty free gold/ silver/ platinum obtained by the nominatedagencies by virtue of an exemption notification issued in this regard. Thisprocedure was prescribed after reviewing the procedure laid down for duty freeimport of gold/ silver/ platinum by nominated agencies for supply to exportersvide Circular No. 28/2009-Customs dated 14.10.2009 so as to avoid divergentpractices and to streamline the supply of precious metals for exports.

2. Gems and Jewellery Export Promotion Council (GJEPC) has representedthat problems are being faced in the field as one to one correlation between thegold procured duty free under Notification No. 57/2000-Customs dated08.05.2000 and corresponding export of jewellery is being insisted upon by theCustoms. GJEPC has represented that it was impossible to establish one toone correlation between such procurement and jewellery manufactured andexported out of the same owing to the homogenous nature of precious metals.3. The matter has been examined. Para 4.34 of Foreign Trade Policyprovides the scheme whereby exporter of gold/ silver/ platinum jewellery orarticles thereof could obtain gold/ silver/ platinum as an input for exportproduct from nominated agencies, in advance. Correspondingly, Customs Notification No. 57/2000-Customs dated 08.05.2000 provides an exemptionfrom Basic Customs Duty (BCD) on import of gold/ silver/ platinum providedthe importer binds himself to export either himself or through other exportersgold/ silver/platinum jewellery including studded articles having gold/ silver/platinum contained equivalent to the imported gold/ silver/ platinum within aperiod of 90 days.

4. Neither the provisions of the Foreign Trade Policy nor the saidnotification and aforementioned circulars refer to the requirement of a one toone correlation between the gold procured and the jewellery exported. Theconstruct of Foreign Trade Policy read with Customs notification clearlyprovides that the nominated agency must establish that imported duty freegold/ silver/ platinum has been exported through the manufacture ofgold/silver/platinum jewellery including studded articles through themaintenance of proper records at the end of the nominated agency as well asthat of exporter. There is therefore no requirement of establishing one to onecorrelation between the consignment of gold/silver/platinum imported and theexport of jewellery. However, the nominated agencies/ exporters are requiredto maintain the accounts of duty free gold and domestically procured duty paidgold in such manner so that duty free gold/ silver/ platinum obtained for thepurpose of export of jewellery is clearly accounted for by the export of jewellery/articles.

5. Difficulties, if any, may be brought to the notice of the Board.

6. Hindi version will follow.

F.No. DGEP/G&J/22/2018

Yours faithfully,

Sd/-
(Saroj Kumar Behera)
Joint Director