Circular No. 24/98-Customs dated 20/4/1998

Sub. : Import of gold, silver and platinum by the Nominated Agencies under various gold, silver and platinum jewellery export promotion schemes.
I am directed to invite your attention to Board's Circular No. 38/96-Cus, dated 9-7-1996, No. 27/97-Cus, dated 8.7.1997 and No. 48/97-Cus, dated 13.10.97 issued from F.No. 305/92/97-FTT regarding procedure to be followed by the Nominated Agencies for supplying duty free gold to exporters under various schemes under the EXIM Policy 1997-2002. In addition to MMTC, SBI, STC, HHEC, PEC, the RBI have authorised a number of banks to import duty free gold for its supply to the exporters, (hereinafter the above said agencies have been referred to as the 'Nominated Agencies'). The Nominated Agencies have brought out their difficulties in following of the procedures prescribed under the above circulars and requested for modification of the same. The Ministry of Commerce (MOC) and GEM & Jewellery Export Promotion Council (GJEPC) have also expressed that the procedure eventually results into declaration of exports. The different problems raised by the Banks, MOC and GJEPC have been carefully examined and the following procedure have been devised to accelerate the export of Gem & Jewellery:-

(i) The Nominated Agencies shall be allowed import of gold or silver for warehousing in their own bonded vaults. The vaults shall be licensed by the jurisdictional Asstt. Commissioners of Customs under Section 58 of the Customs Act, 1962;

(ii) The Nominated Agencies will furnish a bond to the satisfaction of ACC undertaking to properly account for the warehoused gold and silver and also to discharge the duty liability at the prescribed effective rate of duty in the event of the exporter not fulfilling his export obligation within the prescribed period;

(iii) The Nominated Agencies may be permitted to give a general bond for an estimated amount of duty worked out at the effective rate involved in their monthly import or may give a revolving bond starting with a bond equal to the duty estimated at the effective rate on quantity of gold likely to be imported in a month;

(iv) The Nominated Agencies shall be exempt from furnishing separate bank guarantee for the bonds executed by them;

(v) Wherever there is necessity the Commissioner of Customs may allow more than one Nominated Agencies to keep their imported goods in the same vault provided the quantities are. kept segregated and separate accounts are maintained;

(vi) The Nominated Agencies will be required to keep the goods imported for supply to the exporters duty free segregated from the quantities imported for domestic consumption on payment of duty;

(vii) The Nominated Agencies shall be exempt from following the double lock system and physical presence of the Bond Officer will not be required for bonding or exbonding the goods. No cost recovery charges would be payable by the Nominated Agencies;

(viii) The Nominated Agencies shall be liable for surprise audit or checks by the Customs Officers. The Commissioner should devise a system of random audit at least once in 6 months initially and once in a year subsequent;

(xi) The exporters intending to receive gold from the Nominated Agencies will register themselves with their jurisdictional Asstt. Commissioners who will issue them a one-time Certificate specifying therein the details of their units such as name and address of the company and the chief of the organisation. This Certificate has to be produced to the Nominated Agencies while taking gold. The units shall submit an undertaking to the Asstt. Commissioner without bank guarantee to follow the conditions of notification under which they are receiving duty free metal and export the jewellery made therefrom within the period stipulated in EXIM Policy. The EOU units may submit a self-declaration to the Nominated Agencies stating therein the details of their unit;

(x) The Nominated Agencies would allow clearance of the goods for export production under the relevant exemption notification under their own internal documents and would submit a consolidated monthly account in format enclosed of the goods released exporter-wise and the duty involved which will be worked on the basis of effective rate of duty. (Presently @220/-per 10 gms. of gold & @Rs. 500/- per one kg. of silver);

(xi) The Nominated Agencies shall maintain an account of the goods released to the exporters (exporter-wise) on the day-to-day basis. This account shall be liable for inspection by any Customs Authority as the account of a bonded warehouse;

(xii) The exporter shall furnish the EP copy of the shipping bill to the Nominated Agencies as a proof of having exported the jewellery made from the duty free goods released to them within a period prescribed in the EXIM Policy;

(xiii) Wherever such proof of export is not produced within the period prescribed in the EXIM Policy the Nominated Agencies, shall (without waiting for its recovery from the exporter) deposit the amount of duty calculated at the effective rate leviable on the quantity gold/silver not exported within 7 days of expiry of the period within which the jewellery manufactured out of the said gold/silver was supposed to be exported. The duty so paid by the Nominated Agency shall be reflected in the monthly statement prescribed in para (x) above. The Nominated Agencies will settle their claim with the exporter at their own level;

(xiv) The Nominated Agencies shall report the cases of failure to export the jewellery made out of gold/silver released to the exporter to the Commissioner of Customs in whose jurisdictions the licensed vault of the Nominated Agencies is installed;

(xv) The exporters operating under replenishment scheme may be permitted to receive goods from the Nominated Agencies on submission of E.P. copy; and

(xvi) It is clarified that the importers who want to avail of the benefits of import of precious metal's under notification No. 144/93-Cus dated 28-6-93 without going through the above procedure may be allowed to import the said metals by following the conditions in tine said notification.

2. The Circulars No. 38/96-Cus.dated 9.7.96, 27/97-Cus dated 8.7.97 and Circular No. 48/97-Cus dated 13.10.97 stand withdrawn.

3. The above circular may be given wide publicity by way of issuing a Public Notice.

Sd/-
(O.P. Khanduja)
Sr. Technical Officer (FTT)

F.N0.305/92/97-FTT

Monthly Statement to be sent by the Warehouse Owner to the Commissioner of Customs

1. Name of the Warehouse :

Owner

2. Full Address :

3. Bond No.& Date :

4. Amount of Bond :

5. Accepted by :

RECEIPTS

Date	Date of Import	B/ E No. & Date	Date of reware- housing	Quantity of Gold/ Silver / Platinum	Value	Signature of Warehouse owner/ representative
1	2	3	4	5	6	7

ISSUE

Date of Issue	Name & Address of the Exporter	Qty. issued Gold/ Silver Platinum	Value	Duty on the goods issued	Shipping Bill No. & Date	Qty. exported	Qty. not exported in time	Duty credited to customs TR-6 Challan No. & Date	Signature of the Ware- house owner/ represen- tative
1	2	3	4	5	6	7	8	9	10

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