Eximkey - India Export Import Policy 2004 2013 Exim Policy

q 7.28 The cases of a bonafide default in fulfillment of export obligation may be regularised by the licensing authority in the manner indicated below:

A. Advance Licence and Advance Licence for Annual Requirement (i) If the export obligation is fulfilled in terms of value but there is a shortfall in terms of quantity, the licence holder shall, for the regularisation, pay:-

(a) To the customs authority, customs duty on the unutilised value of the imported material alongwith interest at the rate of 24% per annum thereon; and

(b) To the licensing authority, SIL of a value equivalent to five times of the CIF value of the unutilised imported material expressed in free foreign exchange. However, the provision of this sub-paragraph (b) shall not be applicable if the unutilised imported material was freely importable on the date of import.

(ii) If the export obligation is fulfilled in terms of quantity but not value, no penalty shall be imposed provided the licence holder has achieved the positive value addition. However, if the value addition falls below the minimum prescribed, the licence holder shall be required to surrender SIL equivalent to the FOB value of shortfall.

(iii) If the export obligation is not fulfilled both in terms of quantity and value, the licence holder shall, for the regularisation, pay as per (i) and (ii) above.

(iv) Deleted

(v) In case an exporter is unable to complete the export obligation undertaken in full and he has not made any import under the licence, the licence holder will also have an option to get the licence cancelled and apply for drawback after obtaining permission from the Customs authorities for conversion of white / green shipping bills to Drawback Shipping Bills.

B. Quantity based / Value based licences issued as per Export and Import Policy 1992-97, shall be governed, for the purpose of regularisation, in accordance with the provisions of that Policy / Procedures, 1992-97 (RE.96). However, in such cases also, the license holder shall be required to furnish Bank certificate of Exports and realisation showing realisation of export proceeds. However, for value wise shortfall in export obligation, the licence holder shall, for the regularisation, have the option as given in 7.28A(ii) above.

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