In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts parts of aircrafts falling within the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), when imported into India under the Standard Exchange Scheme, from so much of duty of customs leviable thereon, as is in excess of the duty of customs which would be leviable if the value of the said parts were made up of the Standard Exchange Cost, insurance and freight charges both ways, subject to the following conditions, namely :-

(i) such parts have been repaired or overhauled and are not new parts;

(ii) the importer and the exporter have entered into a Standard Exchange Agreement and such agreement is registered with the Director General of Civil Aviation in the Ministry of Civil Aviation;

(iii) the exporter is also registered with the said Director General of Civil Aviation;

(iv) the Standard Exchange Cost charged by the exporter is final;

(v) no drawback of duty has been claimed or will be claimed in respect of parts of aircraft exported for repair or overhaul under the said Standard Exchange Agreement; and

(vi) the importer, at the time of clearance produces,-

(a) a certificate from the exporter to the effect that the imported parts have been supplied from a pool of repaired or overhauled parts maintained under the Standard Exchange Scheme and such parts are not new parts;

(b) a certificate from the exporter that the Standard Exchange Cost charged for repair or overhaul is final.

EXPLANATION. - For he purposes of this notification,-

(1) "Standard Exchange Scheme" means a scheme under which the exporter of aircraft parts undertakes repair or overhaul of aircraft parts and agrees to supply a similar repaired or overhauled part in exchange for a part sent for repair or overhaul;

(2) "Standard Exchange Agreement" means an agreement made under Standard Exchange Scheme;

(3) "Standard Exchange Cost" means the cost of repair or overhaul charged by the exporter of the aircraft part under Standard Exchange Scheme, which also includes charges for materials, if any, used for such repair or overhaul.