EXPORT PROMOTION COUNCIL FOR EOUs & SEZs (Ministry of Commerce & Industry, Govt. of India) 705, Bhikaji Cama Bhawan, Bhikaji Cama Place, New Delhi 110066 Tel : 26167042, 26165805 Fax : 26165538, Email : epces@vsnl.net Dr. L.B. Singhal Director General EPCES CIRCULAR NO. 56 DATED 27-2-2009 Sub : Supplement to Foreign Trade Policy 2004-09, announced on 26-2-2009, caries out following changes in respect of EOUs i) ii) iii) i) Gems & Jewellery EOUs allowed to import gold through personal carriage Reimbursement of additional duty of excise levied on fuel under the Finance Act. Department of Revenue agrees to issue clarification regarding implementation of provisions of Paragraph 6.9(e) of Foreign Trade Policy Gems & Jewellery EOUs allowed to import gold through personal carriage We had received representation from EOUs, specifically from M/s Abhilasha Jewellers, an EOU in Channai, informing that import of gold through personal carriage to the EOUs is not being allowed. This was taken up with Department of Commerce and Department of Revenue and Department of Revenue had agreed for permitting import of gold through personal carriage. Accordingly DGFT has issued Notification No. 88 dated 26/2/2009, a copy enclosed, wherein at the end of Paragraph 6.22, the following has been added:“An authorized person of Gems & Jewellery EOU may also import Gold in primary form, upto 10Kgs. in a financial year through Personal carriage, as per guidelines prescribed by RBI and Department of Revenue.” ii) Reimbursement of additional duty of excise levied on fuel under the Finance Act. In the various open houses, organized by EPCES, under the Chairmanship of Shri G.K. Pillai, Secretary, Ministry of Commerce & Industry, in the last 2 years, EOUs had repeatedly taken up the issue that they are not being permitted reimbursement of additional duty of excise levied on fuel under the Finance Act. This was taken up with Department of Revenue earlier and Department of Revenue had rejected this request. This was again taken up with Department of Revenue after the Kolkata Open House meeting and now Department of Revenue has agreed for reimbursement of this duty. Accordingly DGFT has issued Notification No. 88 dated 26/2/2009 wherein, at the end of Sub-Para 6.11(c)(iv), the following shall be added:- “Re-imbursement of additional duty of excise levied on fuel under the Finance Acts would also be admissible.” iii) Department of Revenue agrees to issue clarification regarding implementation of provisions of Paragraph 6.9(e) of Foreign Trade Policy Paragraph 6.9(e) of the Foreign Trade Policy permits EOUs “supplies of goods and services to such organizations which are entitled for duty free import of such items in terms of general exemption notification issued by MoF”. Such supplies are counted towards NFE of the EOU. However, we had received representation from number of EOUs pointing out that these supplies are not being permitted by the customs authorities as there is no corresponding provision in the Customs notification. M/s General Optics Asia Ltd., an EOU in Chennai had pointed out that they want to supply goods to ISRO that has not been permitted. Similarly M/s Saint Gobain Crystals & Detectors India Ltd, Bangalore had also pointed out that they wanted to supply goods to Educational Institutions but such goods were not being permitted. A representation to this effect had also been received from an EOU in Goa. This issue was taken up with Department of Revenue and now Department of Revenue has agreed that it shall issue necessary clarification implementing provisions of Paragraph 6.9(e) of FTP related to EOUs, thereby allowing them to supply goods and services at zero duty to authorized organizations notified for zero duty import. This has been clearly stated in the brief “Trade Facilitation Measures” released by DGFT along with this Notification. A copy of Paragraph 26(vi) of this brief is enclosed along with. In addition to the above stated measures, as informed yesterday, vide my EPCES circular No. 55, Department of Revenue has already issued Notification No. 18/2009-Cus and 3/2009-Central Excise, both dated 23-2-2009, permitting EOUs to import spares upto a value of 5% in each financial year. Similarly Department of Revenue has also issued Notification No. 18/2008-Cus dated 23/2/09, permitting re-import of exported pharmaceutical sample by EOUs without payment of duty for statutory requirement of stability or retention. This is for your information please. ________________________ PN : All EPCES Circulars, issued during the last 5 years, have been placed on the website www.eouindia.gov.in & www.sezindia.nic.in. Hence for making a reference to any earlier EPCES Circular you can access the above stated website. To access EPCES Circulars, click on to EPCES logo on the homepage and then click on EPCES Circulars. TO BE PUBLISHED IN THE GAZETTE OF INDIA EXTRAORDINARY PART –II SECTION –3, SUB SECTION (ii) GOVERNMENT OF INDIA MINISTRY OF COMMERCE AND INDUSTRY DEPARTMENT OF COMMERCE NOTIFICATION No. 88 (RE-2008)/2004-2009 New Delhi, Dated the 26th February, 2009 S.O (E) – In exercise of powers conferred by Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 (No. 22 of 1992) read with Para 1.3 of the Foreign Trade Policy, 2004-2009 (as amended from time to time), the Central Government hereby makes the following amendment in Foreign Trade Policy: 1. In Paragraph 3.8.2, the word “realized” wherever appearing, stands deleted. This change shall be effective for application filed from 1.4.2009 onwards. 2. In the Paragraph 3.11.2(b), the words “realized as BRC/FIRC” are replaced by the words ‘in free foreign exchange”. This change shall be effective for application filed from 1.4.2009 onwards. 3. Paragraph 4A.4 related to “Nominated Agencies” stands replaced by the following: Nominated agencies are MMTC Ltd, Handicraft and Handloom Export Corporation (HHEC), State Trading Corporation (STC), the Project and Equipment Corporation of India Ltd (PEC), STCL Ltd, MSTC Ltd, Diamond India Limited (DIL), Gems & Jewellery Export Promotion Council (G&J EPC)), Star Trading House (only For Gems & Jewellery sector) and Premier Trading House under Paragraph 3.5.2 of FTP and any other agency authorised by RBI. Exporters (except EOUs and units in SEZ) may obtain gold / silver / platinum from nominated agency(s). Procedure for import of precious metal by these agencies (other than those authorized by RBI and the Gems & Jewellery units operating under EOU and SEZ schemes) and the monitoring mechanism thereof shall be as per the provisions laid down in HBP v1 in this regard. A bank authorised by RBI is allowed export of gold scrap for refining and import standard gold bars as per RBI guidelines. 4. A new sub paragraph 3.12.9 shall be added after the sub-paragraph 3.12.8 as follows: “3.12.9 Duty Credit Scrips under Chapter 3 of FTP can also be utilized for payment of duty against imports under EPCG scheme provided the item is importable against the scrip.” 5. Import Policy for the item ‘Worked Coral’ under ITC (HS) Code “9601 90 40) shall be amended to read as “Free” (instead of “Restricted”). 6. The figure “10000” mentioned in paragraph 3.5.2 against ‘Premier Trading House (PTH)’ stands replaced by “7500”. 7. In paragraphs 3.6.4.5 and 3.12.4, after the words “freely importable”, the words “and / or restricted” shall be inserted. 8. The 2nd sub-paragraph of paragraph 4.3.1 stands amended as follows:- “Credit shall be available against such export products and at such rates as may be specified by DGFT by way of public notice. Credit may be utilized for payment of customs duty on freely importable items and / or restricted items. DEPB scrips can also be utilized for payment of duty against imports under EPCG scheme.” 9. The entry at Sl. No. 124, Chapter 30, regarding ‘Pharmaceutical products’ under Schedule 2 of ITC (HS) Classification of Export and Import Items stands amended as follows: S. No. 124 Tariff Item HS Code 3002 10 11 3002 10 12 3002 10 13 3002 10 14 3002 10 19 3002 10 20 3002 10 91 Unit Item Description Kg Whole human blood plasma and all products derived from human blood except gamma globulin and human serum albumin Export Policy Free Nature of Restriction Exports permitted after obtaining No Objection Certificate (NOC) from Directorate 3002 90 10 3002 90 20 manufactured from human placenta and human placental blood; Raw placenta; Placental blood plasma General of Health Services under Ministry of Health. 10. Following sub para is added at the end of Para 3.10.2: “However, special product(s)/sector(s), having high labour intensity, covered under Table 13 of Appendix 37D, shall be granted duty credit scrip equivalent to 5% of FOB value of exports., Admissible date of export for special product(s) / sector (s) shall also be notified in Table 13 of Appendix 37D of HBP v1.” 11. At the end of paragraph 6.22, following shall be added: “An authorized person of Gems & Jewellery EOU may also import Gold in primary form, upto 10Kgs. in a financial year through Personal carriage, as per guidelines prescribed by RBI and Department of Revenue.” 12. At the end of sub-para 6.11(c)(iv), the following shall be added: Re-imbursement of additional duty of excise levied on fuel under the Finance Acts would also be admissible. This issues in Public Interest. Sd/(R.S. GUJRAL) DIRECTOR GENERAL OF FOREIGN TRADE AND EX-OFFICIO ADDITIONAL SECRETARY TO THE GOVT. OF INDIA (Issued from File No. 01/94/180/982/AM09/PC 4) EXTRACTS OF TRADE FACILITATION MEASURES 26. In addition to the above, DGFT and Department of Revenue provisions have been aligned in following matters:(i) Utilization of Duty Credit scrip allowed under Reward Schemes of Chapter 3 / DEPB in Chapter 4 of FTP for payment of duty under EPCG Scheme . (ii) Notification of DFIA scheme aligned with FTP provisions. (iii) Granite Sector EOUs have been allowed procurement of spares upto 5% value of quarrying equipment in each financial year. (iv) High Tech Products duty credit scrip - Issuance of corresponding Customs Notification for implementing High Tech Products duty credit scrip. (v) Re-import of exported pharmaceutical samples by EOUs without payment of duty for statutory requirement of Stability or Retention has been allowed and notified by DOR. (vi) Department of Revenue shall issue necessary clarification implementing provisions of paragraph 6.9(e) of FTP related to EOUs, thereby allowing them to supply goods and services at Zero Duty to authorized organisations notified for Zero Duty import. (vii) Customs Notification to allow import of Agricultural Capital Goods /Equipments by Status Holders (under para 3.8.6 of FTP) aligned with provisions of FTP.