Amendments in Hand Book of Procedures 2015-20

Circular No. ES/ 159/ 2017-18                                                           September 22, 2017

To: Members of the Council

 Sub: Amendments in Hand Book of Procedures 2015-20

Dear Sir,

We would like to inform you that DGFT vide Public Notice No. 26/2015-20 dated 20^th September, 2017 has made various amendments in Chapter 4 of the Hand Book of Procedures 2015-20 which relates to Duty Exemption/Remission Scheme. These amendments are related to the following, details of which are given here-below:–

1. Fixation of Norms,
2. Advance Authorisation for applicants with multiple units,
3. Entitlement,
4. Application and On-line Inter-Ministerial Consultations for fixation of norms/adhoc norms,
5. Time limit for fixation of norms by Norms Committees,
6. Maintenance of Proper Accounts,
7. Standardization of Adhoc Norms,
8. Exports in Anticipation of Authorisation,
9. Supporting Manufacturer/ Jobber/co-licensee,
10. Acceptance of BG/LUT,
11. Provisional clearance of export consignment,
12. Monitoring of Export Obligation,
13. Redemption / No Bond Certificate,
14. Payment of Customs Duty and Interest in case of bonafide default in EO
15. Duty Free Import Authorisation Scheme (DFIA) regarding application

Please note that Amendments/insertion made are highlighted in bold and underlined.
(1)        Para 4.06 regarding Fixation of Norms following amendments to be read as under:

1. In case where norms have not been notified or where applicant wants to get the    ad-hoc norms fixed before making an application for Advance Authorisation, application in ANF 4B, along with prescribed documents, shall be uploaded online to concerned Norms Committee (NC) in DGFT headquarters for fixation of SION/Adhoc norm. Details of Norms Committees along with products groups dealt by each Norms Committee and respective email addresses for correspondence relating to norms fixation is given in the Public Notice.

(2)        Para 4.06 (iv) has changed to (v) and (v) has changed to (iv)

(iv)    Exporters/EPC shall provide data to the Norms Committee concerned for the fixation of SIONI Adhoc Norms for an export product. Norms Committee shall endeavor to fix SION or adhoc norms on receipt of complete data. Any adhoc norm fixed under this para, on the basis of an application made by an exporter shall be valid for one authorisation for which such application is made and no repeat authorizations shall be issued. However, Norms Committee can specify extended validity period of not more than two years from the date of fixation of such adhoc norms, for grant of further authorizations under such norm.

5. Norms Committees shall also function as recommendatory authority for notification or SION and DGFT may notify such norms from time to time.

(3)        Para 4.10 regarding Advance Authorisation for applicants with multiple units following amendments to be read as under:

1. Transfer of any duty free material imported or procured against Advance Authorisation from one unit of a company to another unit for manufacturing purpose shall be done with prior intimation to jurisdictional Customs Authority. Benefit of CENVAT shall not be claimed on such transferred input.
2. Deleted
3. Deleted
4. Deleted
5. Imported duty free inputs can be taken from the port I domestic suppliers premises to the factory or the premises of the authorization I co-authorisation holder or the factory of the supporting manufacturer (whose name is endorsed in the authorization or allowed by the Jurisdictional Customs authority).

(4)        Para 4.12 regarding Entitlements following amendments to be read as under:

(vii)   Wherever an applicant has applied for components on "net-te-net basis with accountability clause" and such cases fall under paragraph 6 of General Note for all Export Products, the same need not be referred to Norms Committee for fixation of norms. However, exporters shall indicate clearly details of such components imported on "net-to-ner basis with accountability clause" in the export/supply documents namely Shipping Bills, Bill of Exports, Tax invoice for export/supplies prescribed under the GST rules evidencing that these imported inputs have been exported.

(5)        Para 4.14 regarding Application and On-line Inter-Ministerial Consultations for fixation of norms / adhoc norms following amendments to be read as under:

(i)      Application filed online by the applicant shall be forwarded electronically to the concerned Technical/Administrative Ministry / Department /Scientific and Technological institutions or any other agency by the respective Norms Committee in the DGFT headquarters within three days.

(ii)     The concerned Technical/Administrative Ministry / Department / Scientific and Technological institutions or any other agency as the case may be, may communicate its views/comments/recommendations within 45 days electronically/ online. In case no comments are received within 90 days, Norms Committee may take a view based on the facts available on record.

(6)        Para 4.16 regarding Time limit for fixation of norms by Norms Committees following amendments to be read as under:

3. In cases where entitlement of the applicant for grant of Advance Authorisation as per paragraph 4.12 was lower than the quantity of input applied by the applicant under Advance Authorisation and export obligation is completed pending fixation of norms by Norms Committee, entitlement for authorisation as given in paragraph 4.12 may be re-credited upon production of documentary evidence (copies of Shipping bill / bill of export/ Tax invoice for supply prescribed under GST rules) showing fulfilment of export obligation in respect of previous authorisations. However, bond waiver / redemption shall not be allowed pending fixation of norms in such cases.

(7)        Para 4.21 regarding Maintenance of Proper Accounts following amendments to be read as under:

Every Advance Authorisation holder shall maintain a true and proper account of consumption and utilization of duty free imported / domestically procured inputs against each authorisation as prescribed in Appendix 4-1. This record in Appendix 4-1 format, duly verified and certified by the jurisdictional Customs Authority, shall be submitted to the concerned Regional Authority at the time of filing application for redemption / bond waiver. Regional Authority shall compare the details of Appendix 4-1, with that of the inputs allowed in the authorisation, before allowing redemption or bond waiver against individual authorization. Such records shall be preserved for a period of at least three years from the date of redemption.

(8)        Para 4.22 regarding Standardisation of Adhoc Norms following amendments to be read as under:

Following sub para 4.22(b) (iv) is added below para 4.22 (b) (iii)

(iv)   In case an applicant is not able to upload any prescribed document then such documents may be submitted in physical form to the concerned authority.

(8)        Para 4.27 regarding Exports in Anticipation of Authorisation which has to be replaced with Exports/Supplies in anticipation or subsequent to issue of an Authorisation.

1. Exports / supplies made from the date of EDI generated file number for an Advance Authorisation, may be accepted towards discharge of EO. Shipping / Supply document(s) should be endorsed with File Number or Authorisation Number to establish co-relation of exports / supplies with Authorisation issued. Export/supply document (s) should also contain details of exempted materials/inputs consumed.

(9)        Para 4.35 regarding facility of Supporting Manufacturer/ Jobber/co-licensee is
amended to read as under:

(c)     If authorisation holder is registered under GST Act, he has an option of getting names of jobber endorsed by jurisdictional Customs authority as per GST Rules in lieu of Regional Authority's endorsement. In case manufacturer exporter holding authorisation is not registered / not required to be registered under GST Act, job work may be allowed after endorsement of supporting manufacturer's name in the authorisation from RA concerned. However, authorisation holder shall be solely responsible for imported items and fulfilment of EO.

(10)      Para 4.36 regarding Acceptance of BG/LUT following amendments to be read as under:

(b)     In case BG / LUT has been redeemed, Advance Authorization holder can get duty free inputs processed from any manufacturer under Actual User condition as per job work regulations prescribed in terms of provisions of GST Acts under intimation to the Customs authority. However, such restriction shall not be applicable in case of transferable DFIA holder.

(11)      Para 4.43 regarding Provisional clearance of export consignment following amendments to be read as under:

New Para 4.43A is inserted below Para 4.43 as under:

4.43A Re-export of goods imported under Advance Authorisation Scheme Goods imported against Advance Authorisation Scheme, which are found defective or unfit for use, may be re-exported, as per Department of Revenue guidelines. The authorisation holder has to inform the RA who has issued the authorisation before re-export of such defective goods.

(12)      Para 4.44 regarding Monitoring of Export Obligation following amendments to be read as under:

(c)     In case of online filing of EODC application, Exporters shall link all exports on line on DGFT system by linking file number / authorisation number with the relevant shipping bill numbers / bill of exports / invoices in case of deemed exports/Tax invoices for supplies prescribed under GST rules on quarterly basis.

(13)      Para 4.47 regarding Redemption / No Bond Certificate following amendments to be read as under:

(d)     Authenticity of such Certificate may be verified by referring to DGFT website (dgft.gov.in) or from the websites of Zonal offices of DGFT. Zonal offices of DGFT may publish details of such EO DC certificates issued by them and by all RAs coming under their jurisdiction on their official websites every month.

(14)      Para 4.50 regarding Payment of Customs Duty and Interest in case of bonafide default in EO following amendments to be read as under:

(f)     On receipt of said documentary evidence from Authorisation holder, Regional Authority shall redeem the case, shall endorse details of duty paid on the EODC/Redemption Letter and inform details of recovery/ deposits made to the Customs Authority at the port of registration or the Commissioner of Customs having jurisdiction over the factory of the Authorisation holder, as the case may be.

(15)      Under Duty Free Import Authorisation Scheme (DFIA) regarding Application

(b)     Provisions of paragraphs 4.26, 4.27, 4.28, 4.48, 4.49(e) & 4.49 (f) and 4.52 of this Handbook of Procedures shall also be applicable for DFIA Scheme.

New Para 4.54 (c) is inserted below Para 4.43 as under:

2. After completion of exports and realization of proceeds, request for issuance of transferable Duty Free Import Authorisation may be made to concerned Regional Authority within a period of twelve months from the date of export or six months (or additional time allowed by RBI for realization) from the date of realization of export proceeds, whichever is later. (d) Applicant shall be allowed to file application beyond 24 months from the date of generation of file number as per paragraph 9.02 of Hand Book of Procedures.

Members are requested to make a note of the above.

Thanking you,

SRIJIB ROY
ADDITIONAL DIRECTOR