Page 20 - Craftcil April 2017
P. 20

I  impex

             This column is compiled by Consultant [EXIM Policy] of EPCH. It contains recent Public Notices, Notifications and Circulars
                          of DGFT, CBEC and Department of Revenue. If a handicraft exporter has question[s] to ask on
                              Foreign Trade Policy, he/she may please write / e-mail to EPCH at

             Impex # 1           Custom provision relaxed for submission of EODC in EPCG Scheme
           CBEC issues Circular relaxing       Though the EPCG authorisations are issued by DGFT offices, the authorization
           the provisions in Customs        holders are required to give LUT/BG etc. to Customs as per Customs Circular No.
           about submission of EODC in      58/2004 dt. 21-10-2004 (as amended from time to time). This results in dual
           EPCG Scheme to be in line        monitoring of discharge of export obligation by the licensing office & the Customs.
           with provisions in FTP              It has been seen in many cases that the authorisation holders receive SCN
                                            (Show Cause Notice) from Customs for production of EODCs (Export Obligation
           Discharge Certificate) issued by Customs at a time when the authorization holders have already applied to the licensing
           office for issue of EODC but the licensing office has not issued the same. In these situations the exporters have to plead
           to the Customs to keep the SCN in abeyance for adjudication process. However, the proceedings cannot be kept
           pending in 'Call Book' as they do not fulfill the criteria. This leads to confirmation of demand & further litigation. This is
           avoidable if the time period prescribed in Customs notification is aligned with the time period of issuance of EODC as per
           FTP/HBP. To take care of the situation as detailed above, CBEC has issued a Customs Circular No. 16 dt. 02-05-2017. In this
           above circular the SCN as detailed has been replaced by a 'simple notice.' Copy of Customs Circular dt. 02-05-2017
           referred to above is reproduced below:

                                         Copy of CBEC Circular No. 16 dated 2nd May 2017

             I am directed to invite your attention to para 2(d) of Circular No. 5/2010-Cus dated 16.03.2010 directing initiation of
             action to safeguard revenue in case of non-submission of Export Obligation Discharge Certificate within the time
             period stipulated in the relevant Customs notifications. These directions have been reiterated in para 7 (iii) of
             Instruction dated 18th January, 2011.

             2.  Some field formations have expressed difficulty in implementing these instructions stating that when a notice
             issued (as per time lines prescribed in Customs notifications) to exporter for enforcement of Bond/BG is taken up
             for decision, the exporters plead that they have submitted documents to DGFT for issuance of EODC and that
             adjudication process of their SCN may be kept in abeyance till the time EODC is issued to them by DGFT. However,
             the proceedings cannot be kept pending in Call Book as they do not fulfill criteria prescribed in Circular No. 162/73/
             95-CX dated 14.12.1995. This leads to confirmation of demand and further litigation. This is avoidable if the time
             period prescribed in Customs notifications is aligned with time period for issuance of EODC as per FTP/HBP.

             3.  The matter has been examined. It is noted that during the Chief Commissioner’s Conference dated 08-09/01/
             2016, it has been decided that a simple notice will suffice to the licence/authorization holder who does not submit
             the EODC/Redemption letter within the period prescribed in the relevant Customs notifications. In these cases also,
             the principles of natural justice should be followed. Further, this was reiterated during the Chief Commissioner’s
             Conference dated 03.01.2017 wherein it was agreed that in view of time taken by DGFT in issuance of EODC, the
             practice of issuance of SCN at the first stage itself may be replaced by issuance of a simple notice to defaulters.
             4.  In all Advance Authorisation and EPCG notifications, the Deputy/Assistant Commissioners of Customs have
             power to extend the period to submit proof of fulfillment of EO without any limit. Thus there is inherent provision
             in Revenue notifications to keep action of Customs pending till EODC is issued by DGFT. Moreover, the process of
             issuance of EODC by DGFT itself is linked to submission of BRC by the licence holder. The BRC itself can be

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