Import of Restricted Items on Re-export basis - Execution of LUT/BG
WITH reference to the Import Authorisation which are approved for import of restricted items on re-export basis by the EFC, the DGFT clarifies that:-
++ The status holders and manufacturers with a turnover of 5 Cr and above, shall execute only a LUT for the full import value.
++ Other importers, not covered by Sl.No. 1 above, shall execute LUT for the full import value along with a bank guarantee (BG) for a value of Rs. 1 lakh (one lakh Rupees).
++ LUT / BG should have a minimum validity for a time period covering the re-export time plus six months.
++ LUT/BG should be redeemed by RA as soon as the documentary evidence for re-export of goods is furnished by the importer.
Regional Authority (RA) concerned (correct usage – commerce ministry has better command over English than Finance) will take LUT/BG from the importers at the time of issuance of such authorization.
But the MOC also needs a proof reader as the circular has many spelling mistakes like excute for execute, redeemded for redeemed.
The subject itself is not very clear. It reads, “ Executiion of LUT/BG against Import Authorisation issued by import of Restricted Items on Re-export basis. ”
Once we replace by with for, it makes a better sense.
DGFT Policy Circular No. 39/2009-2014 Dated: July 15, 2010