CUSTOMS CIRCULAR No.50/2000 Date 24th May,2000

Execution of B-17 bond by EOU/EPZ/STP/EHTP Units - Clarification of Doubts

I am directed to invite your attention to Board's Circular No.76/99-Customs, dated 17-11-99, on the above subject and to say that a doubt has been raised with regard to debiting of bond in case of fresh import or local procurement of raw materials/capital goods. The doubt is in the context of sub clause (v) of paragraph 6 of the above said Circular wherein it has been mentioned that the duty for debiting bond amount in respect of capital goods/raw materials will be as per duty-foregone amount given in the Bill of Entry/AR-3. However, -Paragraph 3 of the Circular states that the Bond amount (for B-17 bond) will be equivalent to 25% of the duty leviable on the sanctioned requirement of imported and indigenous capital goods plus duty foregone on the raw materials to be held in stock for three months only. As the bond amount for B-17 bond is worked out on the basis of 25% of the duty foregone on the capital goods, it has been represented by the Trade, that debit of the bond to the extent of full amount of duty forgone in case of capital goods as mentioned in Bill of Entry/AR-3,will always result in bond amount failing short, thus requiring execution of another/additional bond.

2. The matter has been considered, it is clarified that for debiting the bond amount in case of fresh imports of procurement of capital goods only 25% of the duty foregone as mentioned in Bill of Entry/AR-3, should be taken and not the entire duty amount. Board's Circular No. 76/99-Cus, dated 17-11-99, referred to above stands modified to the above extent.

3. Wide publicity may be given to the above change by issue of a Public Notice in this regard.

4. Difficulties, if any, faced in understanding or in implementation of the above change, may be brought to the notice of the Board at any early date.

(C P Goyal)
Sr. Technical Officer (FTT)

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