CUSTOMS Notification No 56/2003, Exempts materials imported into India against an Advance License for Annual Requirement

1st April, 2003

Notification No. 56 / 2003 - Customs

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 materials imported into India against an Advance License for Annual Requirement (hereinafter referred to as the said license), with Actual User Condition in terms of Paragraph 4.1.7A of the Export and Import Policy from the whole of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and from the whole of the additional duty leviable thereon under section 3 of the said Customs Tariff Act, subject to the following conditions, namely,-

1. that the said licence shall be issued to a manufacturer exporter or merchant exporter holding Export House, Trading House, Star Trading House or Super Star Trading House Certificate issued by the Licensing Authority.
   
   
2. that the said licence is issued for an export product group specifying the Cost Insurance Freight Value (CIF value) of import permitted against it and the Free on Board Value (FOB value) of export obligation to be achieved. The said licence shall be valid for import of any input required for the manufacture of export product, which is covered under the said export product group specified in the Hand Book of Procedure Volume II of Export and Import Policy;
   
   
3. that an Actual User Duty Exemption Entitlement Certificate (hereinafter referred to as the said certificate) is issued to the holder of the said licence by the Licensing Authority in the form specified in the Schedule annexed to this notification. At the time of import, the full details of value, quantity, technical characteristics and other particulars, of the inputs imported against the said licence shall be entered in part 'C' of the said certificate by the proper officer;
   
   
4. that the importer at the time of clearance of the imported materials executes a bond with such surety or security and in such form and for such sum as may be specified by the Deputy Commissioner of Customs or Assistant Commissioner of Customs, binding himself to pay on demand an amount equal to the duty leviable, but for the exemption, on the imported materials in respect of which the conditions specified in this notification have not been compiled with, together with interest at the rate of fifteen per cent per annum from the date of clearance of the said materials:
   
   
   Provided that the bond shall not be necessary in respect of imports made after the discharge of export obligation in full;
   
   
5. that the said licence and the said certificate are produced before the proper officer of customs at the time of clearance for debit;
   
   
6. that the imports and exports are undertaken through sea ports at Mumbai, Calcutta, Cochin, Magdalla, Kakinada, Kandia, Mangalore, Marmagoa, Madras, Nhava Sheva, Paradeep, Pipavav, Sikka, Tuticorin, Visakhapatnam, Dahej, Nagapattinam , Okha and Mundhra or through any of the airports at Ahmedabad, Bangalore, Bhubaneshwar, Mumbai, Kolkata, Coimbatore, Delhi, Hyderabad, Jaipur, Madras, Srinagar, Trivandrum, Varanasi, Nagpur and Cochin or through any of the Inland Container Depots at Agra, Bangalore, Coimbatore, Delhi, Faridabad, Gauhati, Guntur, Hyderabad, Jaipur, Jallandhar, Kanpur, Ludhiana, Moradabad, Nagpur, Pimpri (Pune), Pitampur (Indore), Surat, Tirupur, Varanasi, Nasik, Rudrapur (Nainital), Dighi (Pune), Vadodara, Daulatabad (Wanjarwadi and Maliwada), Waluj (Aurangabad), Anaparthy (Andhra Pradesh), Salem, Malanpur, Singanalur, Jodhpur, Kota, Udaipur, Ahmedabad, Bhiwadi, Madurai, Garhi Harsaru, Bhilwara and Pondicherry or through the Land Customs Station at Ranaghat, Singhabad and Raxaul.
   
   
   Provided that the Commissioner of Customs may by special order or a public notice and subject to such conditions as may be specified by him, permit import and export through any other sea port, airport, or Inland Container Depot or through a land customs station;
   
   
7. that sourcing of the imported materials from Private Bonded Warehouses set up under paragraph 2.28 of the Export and Import Policy would be allowed;
   
   
8. that the export obligation is discharged within eighteen months from the date of issue of the said licence or within such extended period as may be granted by the Licensing Authority by exporting resultant products manufactured in India. At the time of export, the full details of value, quantity, technical characteristics, and other particulars, of the resultant export product (hereinafter referred to as resultant product) shall be entered in part 'E' of the said certificate by the proper officer;
   
   
9. that the importer produces evidence of discharge of export obligation to the satisfaction of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, within a period of 30 days of the expiry of period allowed for fulfilment of export obligation, or within such extended period as the said Deputy Commissioner of Customs or Assistant Commissioner of Customs], may allow;
   
   
10. that the exempt materials shall not be disposed of or utilised in any manner except for utilisation in discharge of export obligation or for replenishment of such materials and the materials so replenished shall not be sold or transferred to any other person;
    
    
11. that in relation to the said license issued to a manufacturer exporter or merchant exporter,-
    1. the name and address of the supporting manufacturer is specified in the said licence and the said certificate and the bond required to be executed by the importer in terms of condition (4) shall be executed jointly by the Merchant Exporter and the supporting manufacturer binding themselves jointly and severally to comply with the conditions specified in this notification; and
       
       
    2. exempt materials are utilised in the factory of such supporting manufacturer in terms of condition (10).
       
       Explanation : In this notification, -
       1. Export and Import Policy means the Export and Import Policy 2002-2007, published vide notification of the Government of India in the Ministry of Commerce and Industry No. 1/2003, dated the 31st March, 2003, as amended from time to time;
          
          
       2. Licensing Authority means the Director General of Foreign Trade appointed under section 6 of the Foreign Trade (Development and Regulation) Act, 1992 (22 of 1992) or an officer authorised by him to grant a licence under the said Act;
          
          
       3. materials means, -
          1. raw materials, components, intermediates, consumables, computer software and parts required for manufacture of resultant product specified in Part E of the said certificate by the proper officer;
             
             
          2. mandatory spares within a value limit of 10% of the value of the licence which are required to be exported along with the resultant product; and
             
             
          3. packaging materials required for packing of resultant product.

THE SCHEDULE
ACTUAL USER DUTY EXEMPTION ENTITLEMENT CERTIFICATE
PART -1
(IMPORT)

(This consists of ........................... Pages)
Sl. No................................(IMP) Date of issue.................................Port of Registration ............................... Issued to.............................. (name and full address of the licence).

Materials imported against licence No................dated, .............issued by...........to the above licencee would be eligible for exemption from customs duties subject to the conditions specified in the notification of the Government of India, Ministry of Finance and Company Affairs, Department of Revenue No.......... Customs, dated the.....................

Bond with security/surety in terms of the said notification shall be executed before clearance of the goods from the Customs.

Signature
Seal of Licensing Authority
Date :

PART – A

Name and addresses of the factories where the resultant products for export are manufactured.

PART-B

Name and addresses of factories where the ancillaries to the Resultant products for export are manufactured.

PART –C

List of Materials of Import

(a) MATERIALS TO BE IMPORTED UNDER THIS CERTIFICATE

(b) OTHER IMPORTED MATERIALS TO BE USED IN EXPORT PRODUCT

PART -D

Particulars of Import of Materials

(Parts E and F figure in the Export Part of this DEEC)

PART –G