CIRCULAR No.33/2000 Date 2nd May 2000

Duty Free Replenishment Certificate (DFRC) Licence announced in Exim Policy 2000-2001.

Attention is invited to para 7.4 of the Exim Policy and paras 7.55 to 7.62 of the,Handbook of Procedure, Vol.1 of Policy period 2000-2001 in terms of which DFRS licence would be issued to eligible manufacturer exporters or merchant exporters for import of inputs used in the export product. Customs Notification No.48/2000-Cus. has been issued on 25.4.2000 to facilitate import under DFRC Licences.

2. The salient features of DFRC Licence are as follows:

(i) DFRC Licence shall be issued only in respect of export product covered under Standard Input-Output Norms (SION) as notified by the DGFT in Volume II of the Hand Book of Procedure.

(ii) Exporters operating under DFRC shall give a declaration on the EP copy of the shipping bill indicating the S.No. and SION product group of the export product. The EP Copy of the said shipping bill shall also contain declaration regarding the quality, technical characteristics of the inputs used in the export, product.

(iii) DFRC Licence shall permit import of inputs having same quality, technical characteristics and specifications which have been used in the export product, and which are specified in the shipping bills.

(iv) The normal validity period of DFRC Licence shall be 12 months.

(v) DFRC Licence and/or inputs imported against it shall be freely transferable. However, the DGFT/MOC would not be issuing DFRC Licence in respect of SION which are subject to Actual User condition in the Hand Book of Procedure Vol.11. The Customs duty exemption shall not be available to DFRC Licence issued for such SION/inputs.

(vi) Benefits of duty drawback shall be available on the CVD paid on inputs imported under DFRC Licence and also in respect of those duty paid inputs which are not covered under SION and whose import is not permitted against DFRC Licence.

(vii) DFRC Licence shall be issued with single port of registration from where exports have been effected.

3. Following procedure shall be followed for export against DFRC Licence.

3.1 Filing of Shipping Bill for Export.

Exporters under DFRC shall file a shipping bill for export of dutiable goods (where export duties are leviable) or shipping bill for export of duty free goods (where no export duties were leviable). Each copy of the shipping bill shall contain the following endorsement by the exporter.

"Shipping Bill for export under DFRC Scherne"

In this regard Board has issued telex of even number dated 11.4.2000 clarifying that pending issue of Customs Notification No.48/2000, exports under DFRC should be permitted onprovisional basis. All such imports shall be finalised in terms of this Circular and Customs Notification No.48/2000.

3.2 Examination of Exports.

The export goods shall be examined with reference to the description and technical specification of the export product declared in the shipping bill and also the description and technical specification of the inputs declared to have been used in the export product. Samples for testing need not be drawn where goods are exported under central excise seal or accompanied by test reports of statutory authority. Samples for testing should be drawn only when necessary.

4. Following procedure shall be followed for permitting imports against DFRC Licence.

4.1. Imports - subject to normal cheeks/examination

Imports effected against DFRC Licence shall not be cleared under Fast Track /Green Channel Scheme and would be subjected to normal check/examination scheme.

4.2. Sourcing of inputs from Private Bonded Warehouses

The facility of sourcing inputs from private bonded warehouses under para 5.15 of the Exim Policy shall be available and for this purpose the provisions of Section 68 of the Customs Act, 1962 shall be applicable except that the clearance of inputs from bond shall be allowed against DFRC Licence subject to fulfilment of the terms & conditions mentioned in this Circular and Notification No.48/2000-Cus. Dated 25.4.2000.

4.3 Debiting of DFRC Licence

No clearance shall be allowed under Customs Notification No.48/2000-Cus. dated 25.4.2000 unless a debit entry has been made in the DFRC Licence.

4.4 Registration of DFRC Licence and issue of TRA

Prior to first import against DFRC Licence, the licence shall be registered at the port of registration as specified on the Licence. A copy of the licence shall be kept on records of the Customs House of registration. Where imports are intended from other ports, licence holders shall. give intimation to port of registration. Port of registration shall then issue a Telegraphic Release Advice to the port of import and shall also keep a copy of TRA. The details of actual imports against TRA shall be forwarded by port of imports to the port ofregistration.

5. Registration of Ports

Imports and exports against DFRC Licence shall be permissible only from ports, airports, Inland Container Depots and Land Custom Stations specified in condition (4) of Customs Notification No.48/2000-Cus. dated 25.4.2000. Commissioners of Customs have been empowered to permit imports and exports from any port, airport, land custom station or inland container depot subject to such condition as may be specified by the Commissioner.

6. Copy of Customs Notification No.48/2000-Cus. dated 25.4.2000 is enclosed.

7. Standing Orders/Departmental Orders for the information and guidance of the field staff and trade/public notices for the trade, may be issued and copies of the same may be forwarded to the Joint Secretary (Drawback).

(R K Talajia)
S.T.O. (DBK)

(Please refer Cus Cir No.24/2002 date 6/5/2002 for Changes made in DFRC Scheme vide Exim Policy 2002-07)

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