An Exporter's Woes – Letter to Chairman CBEC - SOS
This is the copy of a letter sent by an exporter to the Chairman, CBEC. We hope the dynamic Chairman sorts out his problem.
Thank you very much for the courtesies extended to me when I called on your good selves on 12th February 2009 in connection with the above matter.
As advised by your good selves, I had called on personally Mr N Sasidharan, Chief Commissioner, Nhava Sheva Port on 18th February 2009 and explained our problems. Mr Sasidharan asked us to submit certain information on our past exports, bank guarantees furnished and details on refund of revenue deposits etc,.
We immediately furnished all the details with Chief Commissioner and the matter was examined in light of the submissions. A verification report was submitted by DEEC section that BG worth Rs.1.51 Crores is with Customs and entire export obligation has been fulfilled but Export Obligation Discharge Certificate is yet to be furnished and Refund section too confirmed that an amount Rs. 5.25 lacs Revenue Deposit is pending and the matter is under consideration. Based on these facts the Chief Commissioner permitted furnishing of LUT instead of BG for Rs.216000/- with a condition that the refund of 1% (Rs.2.89 + Rs.1.83 + Rs.0.48 + 0.03 lacs) deposit pending with Customs will be considered and released after we furnish BG of Rs.2.16 lacs within 60 days of clearance of the goods. The furnishing of LUT was considered for a temporary period of 60 days against the refund of Rs.5.25 lacs.
The Asstt Commissione/Dy Commissioner resubmitted our file stating that refund amount of Rs.2.89 lacs is due and Rs.2.36 lacs refund is not clear and therefore, we may insists for BG instead of LU. Finally, we were asked to furnish BG for Rs.2.16 lacs on 26th February 2009. Accordingly, we have furnished BG for Rs.2.16 lacs and have requested for an early clearance of the goods.
In the entire exercise, we have incurred demurrage and detention charges of over Rs.2 lacs , furnished 100% cash margin with the Bank for Rs.2.16 lacs bank guarantee and also delay of 4 weeks.
There is a need to draw a distinction between a manufacturer exporter and exporter and rules should be framed separately for both types of exporters. In a current economic situation, nobody manufacturer exporter can waste financial resources and increase transaction cost.
There is also an urgent need to reconsider the amendment in the Board's circular 58/2004 the eligibility for manufacturer exporter for furnishing LUT. The manufacturer exporter, who have achieved Rs.5 Crores or above physical exports in the current year, should be permitted to clear goods imported against EPCG and DEEC license by furnishing LUT instead of BG. The condition of past 3 years exports performance and good track record should be deleted.
A new manufacturer exporter like us, are finding it difficult to meet these kind of stringent rules in current tight financial market condition and this is making exports from India unviable. An immediate attention to the above matter would be highly appreciable.
The few lakhs of rupees involved here may not be much for the Customs who are tuned to Crores, but for an individual, this is good money hard to come by and the Department should understand the plight, especially in these difficult times.