Circular No.ES/141/2019-20 September 16, 2019
To: Members of the Council
Sub: Revised Norms for Execution of Bank Guarantee under Advance Authorisation, DFIA and EPCG Schemes
Various doubts were raised by members of Trade seeking clarification as to what should be the basis for waiver of Bank Guarantee to be executed with Customs in the GST regime under AA, DFIA and EPCG schemes in respect of manufacturer exporters/service providers.
In this regard, CBIC has examined the matter and issued Circular No. 31/2019 - Customs dated 13th September, 2019 clarifying that the norms for execution of Bank Guarantee under Advance Authorisation (AA), Duty Free Import Authorisation (DFIA) and Export Promotion Capital Goods (EPCG) schemes have been reviewed & the benefit of exemption towards furnishing bank guarantee shall be extended to the following persons –
Manufacturer exporters / Service Providers registered with the GST authorities (Centre/State/Union Territory) –
Who have been exporting during the previous two financial years and have minimum export of Rs. 1 crore or more during the preceding financial year shall also be eligible to claim exemption from furnishing Bank Guarantee under category (d) of importers specified in Table given in para 3.1 of the said Circular.
Who have paid GST of Rs.1 crore or more during the preceding financial year shall also be eligible to claim exemption from furnishing Bank Guarantee under category (e) of importers specified in Table given in para 3.1 of the said Circular.
Further, in order to avoid difficulties in the GST regime regarding furnishing of proof of export performance or payment of duty required to be certified by the jurisdictional Superintendent of Central Excise, it has been decided to discontinue the requirement for procurement of such certificate from Central Excise authorities, in the following manner:
Where the AA/DFIA/EPCG authorisation holder is a registered member of an Export Promotion Council,
He shall produce a certificate of export performance or payment of duty/GST for the purpose of availing Bank Guarantee exemption from the concerned Export Promotion Council on the lines of similar facility available earlier.
Where the AA/DFIA/EPCG authorisation holder is not a registered member of an Export Promotion Council,
He may produce such certificate duly authenticated by a practicing Chartered Accountant who is registered with the GST Department (Centre/State/Union Territory) for payment of GST. This is also on the lines of similar facility available earlier.
The Chartered Accountant will mention his GSTIN and other registration details in the certificate on the lines stipulated earlier.
Members may kindly make a note of the above.