4.27.1

The issue of extension of export obligation (EO) period for the erstwhile Advance Licence for Annual Requirement was considered in the Policy Review Committee meeting held on 21.05.2002. The Committee in the light of the difficulties faced in fulfilling EO on account of exigencies in the international trade scenario and in the absence of any provision of EO extension under Advance License for Annual Requirements , decided to grant EO extension for all Advance Licence for Annual Requirements whose EO period expired / expires prior to 31.03.2003 on the execution of a Bank Guarantee (BG) equivalent to the customs duty with 24% interest on unutilised exempt material. In cases where the extension period upto 31.03.2003 is less than or equal to six months from the date of expiry of the licence, a composition fee of 1% of the unfulfilled obligation on the date of expiry of the licence vis a vis imports made would be levied. However in all other cases where the EO extension period sought upto 31.03.2003 is more than six months from the date of expiry of the licence, a composition fee of 5% of the unfulfilled EO on the date of expiry of the licence vis a vis imports made would be levied.

(Pl. refer PN NO. 26/2002, Dt. 01/08/2002 for date of expiry of the licence)

(This para has been added vide PN NO. 18/2002, Dt. 14/06/2002)