Exemption from Bank Guarantee in respect of Advance Authorization (AA) / Duty Free Import Authorization (DFIA) / Export Promotion Capital Goods (EPCG)Schemes
PARA 3.2(c) of the Circular No. 58/2004-Cus.dated 21.10.2004 inter alia stipulated that exemption from Bank Guarantee contemplated therein will not be available in case the licence holder has been penalized under the provisions of Customs Act,1962, the Central Excise Act,1944, the Foreign Exchange Management Act (FEMA),1999 or the Foreign Trade (Development and Regulation) Act, 1992 during the previous three Financial years.
After noting that the Board had relaxed the criteria for accreditation of importers under the Accredited Clients Programme (ACP) vide Circular No.29/2010-Cus. dt.20.8.2010 which stipulated that the importer for availing the facility under ACP should not have any cases of Customs, Central Excise or Service Tax, booked against them in the previous three financial years, the Board vide Circular 6/2011-Cus dated 18.01.2011 sought to adopt the same and modified paragraph 3.2(c) of the earlier Circular 58/2004 to the said extent.
The cases referred were -
(a) Cases of duty evasion involving mis-declaration / mis-statement/collusion / willful suppression / fraudulent intent whether or not extended period for issue of Show Cause Notice (SCN) has been invoked.
(b) Cases of mis-declaration and/or clandestine/unauthorized removal of excisable / import / export goods warranting confiscation of said goods.
(c) Cases of mis-declaration / mis-statement / collusion / willful suppression / fraudulent intent aimed at availing CENVAT credit, rebate, refund, drawback, benefits under export promotion/reward schemes.
(d) Cases wherein Customs/Excise duties and Service Tax has been collected but not deposited with the exchequer.
(e) Cases of non-registration with the Department with intent to evade payment of duty / tax.
Inasmuch as it was decided by the Board that offences, other than those stipulated above, would not result in denial of the benefit of Circular No.58/2004-Cus.
The Circular 6/2011-Cus also requisitioned taking an affidavit from the license holder stating whether any case(s) for certain offences, regarded as other than technical offences, had been booked during the previous three financial years and it was prescribed that, in case such violation(s) were revealed, the benefit of exemption from bank guarantee should not be extended.
It has been brought to the notice of the Board by exporters, trade associations and the field formations that with this amendment the benefit of availing of exemption from bank guarantee will be denied even before the show cause notice proposing imposition of penalty has been adjudicated.
So, the Board has reviewed the matter and is of the view that the position of not having been penalized should be restored.
Accordingly, thepara3.2 (c) of Circular 58/2004-Cus is now again modified to read as follows:
"(c) The License holder should not have been penalized during the previous three financial years in cases booked against him related to Customs, Central Excise or Service Tax under the provisions of the Customs Act, 1962, the Central Excise Act, 1944,the Finance Act, 1994 (for Service Tax), as detailed below:
(a) Cases of duty evasion involvingmis-declaration /mis-statement/collusion / willful suppression / fraudulent intent whether or not extended period for issue of show cause notice has been invoked.
(b) Cases ofmis-declaration and/or clandestine/unauthorized removal of excisable / import / export goods warranting confiscation of said goods.
(c) Cases ofmis-declaration /mis-statement / collusion / willful suppression / fraudulent intent aimed at availing CENVAT credit, rebate, refund, drawback, benefits under export promotion/reward schemes.
(d) Cases wherein Customs/Excise duties and Service Tax has been collected but not deposited with the exchequer.
(e)Cases of non-registration with the Department with intent to evade payment of duty / tax.
or in cases booked against him under the Foreign Exchange Management Act (FEMA), 1999 or the Foreign Trade (Development and Regulation) Act, 1992.In order to ascertain/verify whether the License/Authorization holder meets this criterion he may be asked to furnish an affidavit. The Commissioners shall ensure that some of the affidavits furnished are cross checked randomly with the field formations for their veracity."
Now the condition in para 3.2(c) is a blend of what was originally existing in Circular 58/2004 and the modification that was made by Circular 6/2011.
With so many conditions, only God knows who will be getting this exemption from Bank Guarantee!
CBEC CircularNo.08/2013-Cus Dated: March 04, 2013