Fast track clearance for EOUs – DGFT notifies procedure
THE Foreign Trade Policy 2004-09 had announced a fast track clearance policy for EOUs having status holder certificates. Paras 6.39.1 to 6.39.13 of the Handbook detailed the scheme. Obviously the Finance Ministry was not very happy with the Commerce ministry’s largesse. In para 21 of the Circular No 54/2004 – cus dated 13.10.2004, CBEC informed the world that Paras 6.39.1 to 6.39.13 of the HOP relating to Fast Track clearances for EOUs, are under review and its implementation may be deferred till a final view is communicated by this Ministry. What the Commerce ministry announced as the policy of the country, the Finance ministry put on hold. Obviously the Commerce ministry had been asked to amend these paras, which they have now done. The entire scheme has been rewritten. The new paras allow the following facilities.
1. Eligibility: EOUs having a status holder certificate are eligible for the Fast Track Clearance Procedure.
2. No examination of import cargo at the Port of import. The jurisdictional Commissioner of Customs / Central Excise may, however, examine consignments at the unit’s place on random basis;
3. Pre- authenticated procurement certificates: The units having physical export turnover of Rs. 15 crores and above in the preceding financial year shall be allowed to import goods without payment of duty on the basis of pre-authenticated procurement certificate issued by the jurisdictional Customs/ Central Excise Authority.
4. Fax and computer outside: EOUs may install one fax machine and two computers in their administrative / registered office outside the bonded premises under prior intimation to the jurisdictional Asst / Deputy Commissioner of Customs or Central Excise.
5. DG sets: Procurement of DG set of capacity commensurate with the actual requirement of the unit shall be permitted under intimation to the Development Commissioner and the jurisdictional Central excise Authority.
6. Removal of capital goods for repair: The units may remove their capital goods or parts thereof for repairs under prior intimation to the jurisdictional Asstt. / Deputy Commissioner of Customs or Central Excise.
7. Priority for DTA clearance of rejects. Request for permission for DTA clearance of rejects shall be considered by the jurisdictional Excise authority on priority basis.
8. Personal carriage of samples of Gems & Jewellery by status holder EOUs are allowed subject to the limit fixed in Para 6.24 without a need for prior permission from Development Commissioner/ Customs / Central Excise.
9. No permission required for
i. DTA sale of finished products
ii. Participation in exhibition
iii. Personal carriage of Gems & Jewellery for export promotion tours
Let us have a look at the facilities originally announced in the Policy and those missing now.
1. facility can be availed on the basis of self certification. It is not clear how to avail the facility now.
2. No security or surety for B-17 bonds. This provision does not find a place now. Should they provide surety/security?
3. clearance of goods on the basis of self certification. This also is absent now. Will Customs supervise clearances?
4. For the purpose of examination of both import and export cargo at Gateway port, the procedures applicable to SEZ units shall apply. Now no examination at the ports, but the officers can verify at the units.
5. clearance of waste and scrap without any permission. Now permission will be given on top priority.
6. No examination of import cargo at port of import and at the unit's premises. Now unit’s premises are not that free.
7. All the domestic procurements/imports duty free shall be made by the units on the strength of self issued
CT3/Procurement Certificates. Certificates will now be issued by the department.
8. Export of samples, return of rejected imported/indigenous material will be made by the unit without seeking any permission. This has gone missing from the new paras; go and seek permission.
9. Procurement of DG set shall be permitted without the permission from Development Commissioner and the jurisdictional Dy. Commissioner, Central Excise. Now no permission is required, but please intimate.
10. The status holder units shall be eligible for factory stuffing without any permission. This is absent in the new scheme. Is it disallowed now?
11. The clearance of samples and temporary removal of Capital Goods and parts for repair shall be allowed on self-certification basis. This is also missing.
12. Sub-contracting shall be based on prior intimation of the process and the details of the sub contractor on annual basis to the jurisdictional Assistant Commissioner/Deputy Commissioner of Central Excise. This too is missing.
13. No prior permission required for:
(i) import of capital goods - missing
(ii) installation of fax machine – now intimation is required
(iii) laptop from outside the approved premises- missing
(iv) DTA Sale of finished products – allowed now also
(v) Inter Unit Transfer - missing
(vi) Sub-contracting - missing
(vii) Participation in Exhibitions- retained
(viii) Personal carriage of Gems & jewellery for export promotion tours -retained
(ix) Replacement/repair of imported indigenous goods - missing
(x) Supply of sale of samples - missing
(xi) Sale of unutilized material .- missing
Obviously,. CBEC was not prepared to give all that freedom to the EOUs. But it appears that the CBEC and DGFT are not on talking terms! Why couldn’t they discuss all these issues before putting it in the policy?. What is this policy if the Commerce Minister tells the world that this is his policy and after a few days, the CBEC says it does not like the policy and so put it on hold and then after three months DGFT says its all changed?.
Now CBEC will take its own time to issue circulars/ notifications to give effect to this policy and may cause quite a lot of confusion. One thing is clear- CBEC is not prepared to release its leash. An expert told me that the so called remote interface is a remote possibility.
Is it fair to have two agencies, the DGFT and the CBEC to confuse our exporters, can’t we centralise the source of confusion to one agency?
DGFT PUBLIC NOTICE NO 50/2004-2009, dated, January 24, 2005