6.21

Sub - Contracting

(a) Sub - contracting by EOU gems and jewellery units through other EOUs, or SEZ Units, or units in DTA shall be subject to following conditions:-

(i) Goods, finished or semi finished, including studded jewellery, taken out for sub - contracting shall be brought back to unit within 90 days.

(ii) No cut and polished diamonds, precious and semiprecious stones (except precious, semi- precious and synthetic stones having zero duty) shall be allowed to be taken out for sub -contracting.

(iii) Receive plain gold / silver / platinum jewellery from DTA / EOU / SEZ units in exchange of equivalent quantity of gold / silver / platinum, as the case may be, contained in said jewellery.

(iv) EOUs shall be eligible for wastage as applicable as per Paragraph 4 A.2 of HBP for sub - contracting and against exchange.

(v) DTA unit undertaking job work or supplying jewellery against exchange of gold / silver / platinum shall not be entitled to deemed export benefits.

(b) Facility of getting job work done from DTA unit will be available even when job worker is not registered with Central Excise authority, subject to condition that goods are brought back to premises of unit on completion of job work.

(c) Export of finished goods from job worker's premises may be permitted, provided such premises are registered with Central Excise authorities. Where job worker is SEZ / EOU / EHTP / STP / BTP unit, no such excise registration is required and export may be effected either from job worker's premises or from premises of unit. Export of such products from job worker's premises shall not be allowed through third parties as provided in FTP.

(d) EOUs may be permitted to remove moulds, jigs, tools, fixtures, tackles, instruments, hangers and patterns and drawings to premises of sub - contractors, subject to condition that these shall be brought back to premises of units on completion of job work within a stipulated period. Raw materials may or may not be sent along with these goods.

(e) In case of sub - contracting of production process abroad, goods may be exported from sub - contractor premises subject to conditions that at the time of clearance of goods, the EOU / EHTP / BTP / STP unit shall declare (i) the transaction value of the finished goods to be cleared from the sub - contractor's premises abroad; (ii) job work charges to be paid to the sub - contractor abroad; and (iii) value of intermediate goods; supported with documents like (a) sale price contract / or invoice for the finished goods, (b) job work contract and (c) the basis of arriving at the value of intermediate goods. The EOU / EHTP / BTP / STP unit shall also ensure full repatriation of foreign exchange declared as the transaction value of the finished goods cleared from the sub - contractor's premises abroad.