Customs - Option to close cases of default in Export Obligation - Board Explains
BY Public Notice No. , dated 12.08.2013, the DGFT has provided an option for redemption/regularisation of old cases of default in Export Obligation under (a) Duty Exemption Scheme (b) EPCG Scheme.
All pending cases of the default in meeting Export Obligation (EO) can be regularised by the authorisation holder on payment of applicable customs duty, corresponding to the shortfall in export obligation, along with interest on such customs duty; but the interest component to be so paid shall not exceed the amount of customs duty payable for this default.
While reporting this in 13.08.2013, we had questioned, Will the Customs Department agree? Will they issue a notification/ circular?
The Government by Notification No. 46/2013-Customs dated 26.09.2013 has amended 36 Customs Notifications to insert the words, "In a case of default in export obligation, when the duty on goods is paid to regularise the default, the amount of interest paid by the importer shall not exceed the amount of duty if such regularisation has been dealt in terms of Public Notice of the Government of India in the Ministry of Commerce No. 22 (RE-2013)/2009-2014 dated the 12th August, 2013."
Now, Board has issued that much required Circular. Board clarifies that:
1. The cases where export obligation period is yet to be over, are not covered under the Option.
2. Normally no refund is envisaged to arise on account of choosing the Option. However, there may be cases of calculation mistakes to be dealt on merits.
3. DGFT PN No. 22 (RE-2013)/2009-2014 dated 12.8.13 specifies that necessary procedures would be indicated separately.
Board wants Commissioners to ensure that the cases under the Option are monitored and tracked from the initial stages of exporter approaching for paying the duty, etc. so that there is efficient handling and the subsequent actions, for expeditious closure of these older cases of bona fide EO default, take place seamlessly, if infringement of other conditions is not involved.
Board also wants the Commissioners to put in place suitable mechanism for this and closely supervise it.
CBEC Circular No. 40/2013-Cus., Dated: October 09, 2013