Revised Ftp

8/3/2019 Revised Ftp

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Policy inRetrospect

4

Policy in Retrospect

This being the annual updation of Foreign Trade Policy 2009 14

(which was announced on 27th August, 2009) one cannot expect too

many changes.

The recession is said to be over and therefore additional fiscal

support by way of incentives would be for those sectors only which

are still lacking behind.

Exports have increased compared to 2008 2009 and 2009 2010.

But, the growth is moderate compared to earlier years, 2002 2007.

The excise duties have been increased from 8% to 10% in the last

Budget and the revenue receipts for the year 2010 2011 as

presented in the Union Budget 2011, read as under


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5

Revenue Receipt(Rs. in Crore)

534094465103474218Net Tax Revenue

208997164832164361Less States' Share

356031602500Less - NCCD transferred to theNational Calamity Contingency Fund

/ National Disaster response fund

165116101602Taxes of the Union Territories

680005800065000Service Tax

132000102000106477Union Excise Duties

1150008447798000Customs

603511425Other taxes and Duties

128066131421112850Income tax

301331255076256725Corporation tax

746651633095641079Gross Tax Revenue

1. Tax Revenue

REVENUE RECEIPTS

2010-2011

BudgetEstimates

2009-2010

RevisedEstimates

2009-2010

BudgetEstimates

6

Revenue Foregone in financial years 2008-09 and

2009-10(Rs. in crore)

79.54%50229968.59%414099Grand Total

6.01%379707.36%44417Less Export credit related

85.56%54026975.95%458516Total

39.43%24902137.39%225752Customs duty

27.04%17076521.25%128293Excise Duty

6.48%409296.22%37570Personal Income-tax

12.60%7955411.08%66901Corporate Income-tax

Revenue

Foregone

as a per

cent of

Aggregate

Tax

Collection

in 2009-10

Revenue

Foregone

in 2009-

10

Revenue

Foregone

as a per

cent of

Aggregate

Tax

Collection

in 2008-09

Revenue

Foregone

in 2008-09


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7

Not es: Aggregate Tax Collection refers to the aggregate of net direct

and indirect tax collected by the Central Government.

The figure of Aggregate Tax collection for 2008-09 is at actuals

and that for 200910 is based on revised estimates.

To conclude, the amount of revenue foregone continues toincrease year after year. As a percentage of aggregate tax

collection, revenue foregone remains high and shows an increasing

trend as far as Corporate Income-tax is considered for the financial

year 2008-09. In case of indirect taxes the trend shows a significant

increase for the financial year 2009-10 due to reduction in customs

and excise duties. Therefore, to reverse this trend expansion in thetax base is called for.

8

Revenue Foregone on Account of Export Promotion

Concessions(Rs. in crore)

38862059Vishesh Krishi and Gram Udyog Yojana

(VKGUY)10

2651220Target Plus Scheme9

206418Duty Free Entitlement Credit Certificate8

16461268Duty Free Import Authorization Scheme7

43111DFRC6

32042324SEZ5

88067092DEPB Scheme4

55747833EPCG3

801513401EOU/EHTP/STP2

1068212389Advance License Scheme1

2009-10(Estimated)

2008-09(Provisional)

Name of the SchemeSr.No.


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9

Revenue Foregone on Account of Export Promotion

Concessions (Rs. in crore)

3797044417

Revenue Foregone on account of input

tax neutralization or exemption schemes

to be reduced from Gross Revenue

Foregone on account of Customs Duty

15

56524636

Less Revenue Foregone on account of

incentive schemes mentioned at sl. nos. 8

to 12

14

4362249053Total13

769408Focus Market Scheme12

526531Served from India Scheme11

2009-10

(Estimated)

2008-09

(Provisional)Name of the Scheme

Sr.

No.

10

N.B.:

These aforesaid estimates of revenue foregone do not include revenue

foregone on account of adhoc exemption orders issued under section 25

(2)* of Customs Act, 1962, that relates to circumstances of an

exceptional nature.

*Section 25 (2) reads as under:

If the Central Government is satisfied that it is necessary in the public

interest so to do, it may, by special order in each case, exempt from

the payment of duty, under circumstances of an exceptional nature to

be stated in such order, any goods on which duty is leviable.


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11

Revenue & Exports

1.5900.4603886VKGUY10

0.1080.031265Target Plus Scheme9

0.0840.024206DFCE Certificate80.6730.1951646DFIA Scheme7

0.0180.00543DFRC6

1.3110.3793204SEZ5

3.6021.0428806DEPB Scheme4

2.2800.6595574EPCG3

3.2780.9488015EOU/EHTP/STP2

4.3691.26310682Advance License

Scheme

1

% of indirect tax

collection

[Cus.+ C.Ex.+

Service Tax=

Rs.244477/-

crore]

% of total

exports

Rs.

845506/-

crore

Revenue forgone

amount for the

year 2009-10

(Estimated)

[In Rs. Crore]

Name of the SchemeS.

No.

12

15.5314.49137970Revenue Foregone on account of

input tax neutralization or

exemption schemes to be reduced

from Gross Revenue Foregone on

account of Customs Duty

15

2.3120.6685652Less Revenue Foregone on account

of incentive schemes mentioned at

sl. nos. 8 to 12

14

17.8435.15943622Total13

0.3150.091769Focus Market Scheme12

0.2150.062526Served from India Scheme11

To conclude:

The provisions made by finance ministry for release of funds towards export

promotion would ultimately decide the future of all promotional schemes.

Hence, one should not expect too much on actual incentives.


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UnderstandingPolicy

14

Export Promotion Schemes for

import/procurement of Inputs

DutyExemption

Duty

Neutralisation /

Remission

Rewards/Incentives

by way of DutyCredit


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15

Adv. Autho.

Import DomesticProcurement

All Import dutiesincluding Anti-

dumping duty andsafeguard duty are

exempted.

Excise Duty isexempted and

domesticmanufacturergets Deemed

Exports benefits

Import

Basic Customs

Duty exempted

[CVD is payable,

however,importer can get

Cenvat Credit]

Duty Exemption

EOUTransferable

DFIA

16

Drawback

If CenvatCredit

is availed

If CenvatCredit

is not availed

Drawback islimited to

customs duty

only

Drawback is

available for

Customs +

Excise dutiespaid

Duty Neutralisation / Remission

Exemption and Neutralisation / Remission

are mutually exclusive

DEPB

Neutralisation of BCD

on inputs as perSION. It can be

debited for payment

of any Customs Dutyon permissible

imports


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Served

from India

Scheme

[SFIS]

Vishesh

Krishi and

Gram Udyog

Yojana

[VKGUY]

Focus

Market

Scheme

[FMS]

Duty Credit

Scrip of 10%

Duty Credit

Scrip of 5%

Duty Credit

Scrip of 3%

Focus Product

Scheme [FPS]/

Market Linked

Focus Products

Scrips [MLFPS]

Duty Credit

Scrip of 2%

Rewards/Incentive Schemes

administered by DGFT

Duty credit scrips are Transferable, they can besold and premium can be earned [except SFIS]

18

Schemes specifically for

import/procurement of Capital Goods

EPCGScheme

EOUScheme

Status Holder

Incentive

Scrip

Zero DutyEPCG

Scheme

for

specified

sectors

3% EPCGScheme

for all

sectors

Works as

zero duty.

Applicableonly for status

holders of

specified

sectors

Zero duty

for EOU/

EHTP/

STP/BTP units


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Issues listed byTask Force with

respect to FTP

20

EDI system should be developed for issuance of ARO /

Invalidation under Advance/EPCG Licenses

Status of redemption of licenses should be available on

DGFT server

Message exchange with Customs should be implementedfor other variants of Advance License i.e. Annual

Advance License and DFIA

Message exchange with Customs should be implemented

for Chapter 3 FTP schemes

Offline software facility should be provided for filingapplications on DGFT server

Online application facility should be provided for status

holder certification

EDI and other IT-related issues with DGFT should be

resolved

2.

Application fee for export promotion-related licenses

(e.g., DEPB, Advance Authorization, EPCG) should not

be charged on ad-valorem basis

1.

Whether

implemented ()or pending ()

Issues listed by Task ForceSr.

No.


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Import of spares should be permitted without restriction,

with a corresponding export obligation

10.

Requirement of submission of hard copies of DEPB EDI

shipping bills should be done away with

9.

Priority treatment should be given to Status Holders while

processing applications in DGFT and Customs

8.

Requirement of separate Legal Undertakings for each

license and each organization may be should be done away

with

7.

Requirement of submission of export order for issue of

export license may be done away with

6.

Requirement of submission of Proforma Invoice for issue of

import license for restricted items may be done away with

5.

Adhoc norms should apply to all cases for the same exportproduct upto one year in retrospect4.

Requirement of submission of Chartered EngineerCertificate with Para 4.7 applications may be removed

3.

22

SION for fashion related goods need to be revised at regular intervals

and self-certification should be allowed for para 4.7 cases

20.

The norms for calculating average export obligation value under

EPCG scheme need to be revised

19.

An annual EPCG license scheme should be devised, specially for theservice sector

18.

Requirement of submission of Chartered Engineer Certificate for

issuance of EPCG licenses may be removed

17.

Passport copy of the applicant should be accepted for issuance of IEC16.

The monthly exchange rate notified by Customs may be allowed to

be used for converting shipping bills into FFE, in the EPCG scheme

15.

Duplicate verification of documents by Customs after redemption of

licenses to be done away with

14.

Time taken for redemption of Advance Authorization / EPCG licenses

should be reduced through better monitoring and self-certification

13.

MDA assistance should be company-specific and not individual-

specific

12.

Time for submission of installation certificate by EPCG holders

should be relaxed in case of delays by Central Excise

11.


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23

Suggest ions by Sudhakar Kast ure as amember of Task Force

DEPB Rate Schedule to be aligned to ITC HS

Classification for Export & Import Items

24.

Simplification of Invalidation of Authorisations

Invalidation process should be made simpler. Instead

of issuing ARO etc., a simple endorsement should be

done on the body of authorization.

23.

Para 3.12.8 of FTP: Procurement from Domestic

Sources - Local procurement is allowed under the

Served from India Scheme [SFIS]. It was recommended

to extend such facility for other Duty Credit Scrips

viz. FMS, FPS and VKGUY as well.

22.

DEPB application should be modified to include

FMS/FPS percentage also. Fees for DEPB to be

abolished.

21.

24

Clubbing of Advance Authorisation:

As per Para 4.1.3 of FTP there are no separate categories for

Advance Authorisation any more.

However, operationally, RAs treat Advance Authorisations issued

for intermediate supply and Deemed Exports separately and this

leads to unnecessary trouble and confusion.

Even in guidelines for applicants given in the application format

for clubbing, ANF 4D, prescribes that clubbing of Advance

Authorisation and Annual Advance Authorisation is not

permitted. This seems to be anomaly, as the basic provisions of

Clubbing [Para 4.20 of HBPv1] do not contain such provision.

It was therefore recommended that -

A clause should be included in clubbing provisions as well as

Export obligation provisions that Export or Deemed Export will

qualify for discharge of export obligation against any

authorisation howsoever, issued subject to time limit of 36

months for exports, and 30 months for imports.

Also the condition mentioned in ANF 4D for clubbing of Advance

Authorisation and Annual Advance Authorisation should be

deleted.

25.


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Para by Para Studyof Foreign Trade

Policy &

Procedures

Chapter 1B-FTP

Special Focus

Initiatives


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27

PARA 1B.1 - Special Focus

(ii) Technological Upgradation:

At the end of sub-point (a) following sentence is added, which is as

under:

This scheme is being expanded to cover more export product groups

including marine products, sports goods, toys, rubber & rubber products,

additional chemicals / allied products and additional engineering

products. The scheme is also being extended upto 31.3.2012.

Remarks:

Addit ion of more products.

New point at sr.no.(c) is added, which is as under;

(c) The facility of EPCG Scheme for Annual Requirement is beingintroduced to reduce documentation and transaction time.

Remarks:

Good pr ovision.

28

(iii) Support to status holders

In the para, Bold sentence is added.

The Government recognized Status Holders contribute approx.

60% of Indias goods exports. To incentivise and encourage the

status holders, as well as to encourage Technological upgradation of

export production, additional duty credit scrip @ 1% of the FOB

value of past export shall be granted for specified product groups

including leather, specific sub-sectors in engineering, textiles,

plastics, handicrafts and jute. This duty credit scrip can be used for

import of capital goods by these status holders. The imported

capital goods shall be subject to actual user condition. The status

holder incentive scrip scheme is being expanded to cover more

export product groups including marine products, sports goods,

toys, specified chemicals and allied products and additionalengineering products. The scheme is also being extended upto

31.3.2012.

Remarks:Welcome provi sion.


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(iv) Agriculture and Village Industry

Sub-point (f) of Agriculture and Village Industry is

substituted as under:

Substituted point (f) Additional flexibility for agri-infra scrip by way oflimited transferability to other status holders and theunits in Food Parks allowed.

Old point (f) Certain specified flowers, fruits & vegetables areentitled to a special duty credit scrip, in addition to thenormal benefit under VKGUY.

Remarks:Transferabil it y expanded t o Food Park unit s.

30

(v) Handlooms

Following new sub point is added(a) 2% bonus benefits under focus product scheme.

Bold sentence is added(c) Duty free import entitlement of specifiedtrimmings and embellishments is 5% of FOB value ofexports during previous financial year. Handloommade-ups have also been included for theentitlement.

(vi) Handicrafts

New sub point (h) is added, which is as under:

(h) In addition to above, 2% bonus benefits underFocus Product Scheme for Handicraft exports.


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(vii) Gems & Jewellery

Bold words are added in sub point (b) under Sector (vii)

Gems & Jewellery, which reads as under:

(b) Duty Free Import Entitlement (based on FOB value

of exports during previous financial year) of

Consumables, Tools and additional items allowed for:

1. Jewellery made out of:

(a) Precious metals (other than Gold & Platinum) 2%

(b) Gold and Platinum 1%

(c ) Rhodium finished Silver 3%

2 . Cut and Polished Diamonds 1%

32

(viii) Leather and FootwearFollowing two new sub points are added

(a) Additional 2% bonus benefits under Focus Product Scheme.

(b) Finished Leather exports to be incentivized under FocusProduct Scheme.

Underlined words are replaced by bold words in sub para (i)

Re-export of unsold hides, skins and semi finished leather shall beallowed from Public Bonded warehouse (OLD- at 50% of theapplicable export duty) without payment of export duty.


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(ix) Marine Products

Sub point (e) is amended as under:New Para (e) Marine products are incentivized at special higher rate underVKGUY scheme.

Old Para (e) Marine products are considered for VKGUY Scheme.

Following new sub point (f) is added:(f) Marine sector included for benefits under zero duty EPCGscheme.

(x) Electronics and IT Hardware Manufacturing IndustriesTwo new sub points are added

(a) Export of electronic goods to be incentivized under FocusProduct Scheme.

(d) Electronics Sector included for benefits under SHIS scheme.

34

(xi) Sports Goods and Toys

Two new sub points are added

(e) In addition to above, 2% bonus benefits under

Focus Product Scheme for Sports Goods & Toys.

(f) Sports goods & Toys included for benefits under zero

duty EPCG and SHIS schemes.

General Remarks for point nos. (v), (vi), (vii), (viii),(ix ), (x) and (xi):Addit ional benefi t s are granted for vari ous sectors.


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Chapter 1-HBPIntroduction

36

PARA 1.1 Notification

Underlined words are replaced by bold words

In pursuance of the provisions of paragraph 2.4 of FTP,the Director General of Foreign Trade (DGFT) herebynotifies the compilations known as HBPv1, HBPv2 andSchedule of DEPB rates. These compilations, as amendedfrom time to time, shall remain in force until 31stMarch, 2014, except DEPB scheme, which shall continueto be operative till 31st, December 2010 or till a

replacement scheme is announced, whichever is earlier30th June, 2011.

Remarks:DEPB scheme ext ended upt o 30t hJune, 2011.


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Chapter 2-HBPGeneral Provisions

Regarding Imports

and Exports

38

PARA 2.49 Application for Grant of Export Licence/ Certificate /

Permission

In the first sentence of para mentioned after Point NO. IV ofprocedure/guidelines for filing/evaluation of applications forentering into an arrangement or understanding for site visits, on-siteverification and access to records /documentation - words forexport of any other item which is not restricted or prohibited forexport are substituted by words for export of items not coveredunder Drugs &Cosmetics Act, 1940, which have usage inhospitals, nursing homes and clinics, for medical and surgicalpurposes and are not prohibited for export..

Substituted words for export of items not covered under Drugs &Cosmetics Act, 1940, which have usage in hospitals, nursing homes

and clinics, for medical and surgical purposes and are not prohibitedfor export were appearing in the FTP earlier, which were replacedby PN No. 64 Dtd. 18.05.2010 and now are reintroduced.

Remarks:Reintroduction of earlier provision.


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PARA 2.70.6 - New EDI Initiatives Deleted

Deleted para reads as under:To further improve quality of services some new EDI

initiatives are being taken by DGFT:

Electronic Message Exchange between Customs and

DGFT in respect of incentive schemes under Chapter 3

will become operational by 31st December, 2009.

Remarks:In pract ice, Cust oms demand cert i f icate ofgenuineness from DGFT, which defeats the purpose of

EDI init iat ives otherwise also.

Chapter 3-FTP

Promotional

Measures


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PARA 3.12.6- Imports Allowed

Second sub-para of para 3.12.6 amended, which reads as under:

Utilization of Duty Credit scrip earned shall be permitted for

payment of duty in case of import of only those vehicles, which are

in the nature of professional equipment to the service provider.

Old para

Utilization of Duty Credit scrip earned shall not be permitted for

payment of duty in case of import of vehicles, even if such vehicles

are freely importable under ITC (HS).

Remarks:

These would be vehicles similar to golf carts, battery operatedvehicles used to carr y equipments in studios et c. (mainly of f t heroad vehicles)

42

PARA 3.13.4 - Agri. Infrastructure

Incentive Scrip

i) In the first para, Para no. 3.7.2 of HBPv1 is replaced by Para no.3.4 of HBPv1.

Remarks:Para 3.4 of HBPv1 deals with refusal/suspension/ cancellationof stat us cert if icate and Para 3.7.2 of HBPv1 is relat ing to Agri .Inf rast ructure Incent ive Scrip .This is an error, wil l be correct ed subsequent ly.

ii) In last sub-para of para 3.13.4 following bold words are added:However, for import of Cold Chain Equipment, this Incentive Scrip

shall be freely transferable amongst Status Holders as well as toUnits (the term Units shall not include Developers) in the FoodParks.

Remarks:Limited additional transferability provided.


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PARA 3.15.2- Entitlement

[Focus Product Scheme (FPS)]

Following sub-para is added at the end of para 3.15.2

New sub-para:

Further, Focus Product(s) / sector(s) that are notifiedunder Table 7 of Appendix 37D shall be grantedadditional Duty Credit Scrip equivalent to 2% of FOBvalue of exports (in free foreign exchange) over andabove the existing rate for that product / sector fromthe admissible date of export / period specified in thepublic notice issued to notify the product / sector.

Remarks:BONUS

44

PARA 3.16.1- (Status Holders Incentive Scrip)

Bold words in first para are added:

With an objective to promote investment inupgradation of technology of some specified sectors aslisted in Para 3.16.4 below, Status Holders shall beentitled to incentive scrip @1% of FOB value of exportsmade during 2009-10, 2010-11 and during 2011-12, ofthese specified sectors, in the form of duty credit.

New sub-para added:

The Status Holders of the additional sectors listed inthe Para 3.10.8 of HBPv1 2009-14 (RE-2010) shall beeligible for this Status Holders Incentive Scrip on exportsmade during 2010-11 and 2011-12.


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PARA 3.16.1- (Status Holders Incentive Scrip)

Remarks:

St at us holder i ncent ive scri p is fur t her extended for

one more year f or 2011 2012 export s.

The benefi t s of t he scheme have been ext ended t oaddit ional sect ors such as Chemical & All ied products,paper, paperboard and articles thereof, ceramicproducts, re-fractories, glass & glassware, rubber &articles thereof, plywood and allied products,

electronics product s, sport s goods and toys and

addit ional engineer ing product s . Such addit ionalsectors shall be entitled for the benefit only on exportsmade duri ng 2010-11 and 2011-12.

46

PARA 3.16.4

Following sub-para added at the end of para 3.16.4:

The Status Holders of the additional sectors listed in

the Para 3.10.8 of HBPv1 2009-14 (RE-2010) shall be

eligible for this Status Holders Incentive Scrip on exports

made during 2010-11 and 2011-12.

Remarks:The additional sectors shall now enjoy the benefit ofSt at us Holders Incent ive Scri p.


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Chapter 3-HBPPromotional

Measures

48

PARA 3.7.2 (VKGUY)

Third para of Para 3.7.2 of HBPv1 is amended, which reads as

under:

Applications received after the last date shall be summarily

rejected, as Para 9.2 [OLD- Para 9.3] and Para 9.3 [OLD-Para 9.4]

shall not be applicable.

Remarks:Para 9.3 of HBPv1 is related to imposition of late cut, Para 9.4of HBPv1 is relat ed to supplementar y clai ms.

Here also t here is an err or, as Para 9.2 of HBPv1 is aboutDenomination of Import Authorisation / Licence / Certificate /Permissions.


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PARA 3.10 - Procedure for Status

Holders Incentive Scrip

Para 3.10.3 amended to read as under:

Amended Para:

The last date of filing the application shall be 31st March

2011/2012/2013 for SHIS scheme for exports made during 2009-

10/2010-11/2011-12 respectively.

Further, in view of fourth sub-para of Para 5.1A of HBPv1:

a) Para 9.3 of HBPv1 shall not be applicable for SHIS Scheme in

cases where the SHIS application (say for exports made during

2009-10) has been filed after the prescribed date (i.e. after

31st March 2011) and Zero Duty EPCG Authorisation has beenissued to the applicant by any RA during the year 2010-11 (from

1.4.2010 till 31.3.2011).

50

b) Similarly for SHIS Applications for exports made during 2010-11

& 2011-12 filed late (i.e. after the prescribed dates of 31stMarch 2012/2013 respectively), Para 9.3 shall not be applicablein cases where Zero Duty EPCG Authorisation has been issued tothe applicant by any RA during the year 2011-12 (from 1.4.2011till 31.3.2012) or 2012-13 (from 1.4.2012 till 31.3.2013) as thecase may be.

c) In case SHIS Application is filed within the prescribed date(for exports made during 2009-10/2010-11/2011-12 as thecase may be, including any supplementary claim under Para9.4 of HBPv1) and where Zero Duty EPCG Authorisation hasbeen issued to the applicant by any RA during the relevantyear (i.e. during 2010-11/2011-12/2012-13 respectively, asthe case may be), SHIS application shall be summarily

rejected in view of fourth sub-para of Para 5.1A of HBPv1.

Old para 3.10.3:The last date of filing the application shall be 31st March 2011 forSHIS Application on exports made during 2009-10 (and 31st March2012 for SHIS Application on exports made during 2010-11).


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Remarks:

Date of filing of application would be within one yearof t he year of export s eff ect ed.

Duty credit scrip appli cati ons shall not be considered:

In case, it is filed beyond prescribed last date of

application. In case, Zero Dut y EPCG Scheme is avai led in t he

par t icular peri od i .e. 201011, 201112 & 201213.

Provision of late cut is not applicable, which please

not e.

52

PARA 3.10.8 New para added

The following additional sectors shall be eligible for

Status Holders Incentive Scrip on exports made during

2010-11 and 2011-12:

Contd.


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53

Various codes(xi)Misc. Products (Codes 3201, 32029010, 32030010, 3604,

3605, & 38021000)

Various codes(x) Graphite Products (Codes 3801, 85451100 and 85451900) &

Explosives (Codes 3601, 3602 and 3603)

Codes 05061039 and

35030020

(ix) Ossein & Gelatine

Various codes(viii) Animal By-products (Codes 35030030, 05069099,

05079010, 05079020, 05079050, 23011010, 23011090,

96062910 and 96063010)

Chapter 49(vii) Books, Publications & Printings

Chapter 48(vi) Paper, Paper Boards & Paper products

Chapter 69(v) Ceramics / refractories

Chapter 44(iv) Plywood and allied products

Chapter 70(iii) Glass and glassware

3208, 3209, 3210(ii) Paints, Varnishes & Allied Products

4001 to 4010,

4014 to 4017(i) Rubber products,

Chemical & Allied Products (other than Bulk minerals,

Granite/Stones, Processed minerals, Cement, Clinkers and

asbestos)

1

ITC(HS)Products / Product GroupsSl.

No.

Contd

54

(iii) Ferro Alloys

(ii) Pipes and tubes

(i) Iron and Steel

Chapter 72Engineering products for the three groups

indicated below4

Chapter 95 and Codes

420321, 650610

Sports Goods and Toys3

Electronics Products2

Remarks:SHIS is now ext ended t o above ment ioned addi t ional sectors.


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55

PARA 3.11 - Common procedural features for

promotional schemes, applicable to all schemes in

this chapter, unless specifically provided for:

PARA 3.11.8 - Declaration of Intent on Free Shipping Bills

Bold paras are reintroduced which were deleted and replaced videPN.82 dtd.16.07.2010 and other paras are newly introduced:

For export shipments filed under Free Shipping Bill category,for exports of products / to markets eligible under Chapter 3 ofFTP (Appendix 37A, 37C, 37D), the exporter shall state theintention to claim benefits under Chapter 3 of FTP by declaringon the Free Shipping Bills as under:

I/We, hereby, declare that I/We shall claim the benefits, asadmissible, under Chapter 3 of FTP.

This declaration shall not be required for export shipments underany of the schemes of Chapter 4 (including drawback) or Chapter5 of FTP.

Contd

56

Further for products, markets notified during the year, this

declaration shall be necessary for exports under Free ShippingBills, only after a grace period of one month from the date ofrelevant public notice.

Moreover for exports made prior to date of notification ofproducts / markets, such a declaration will not be required, sinceexport shipments under Free Shipping Bills have already takenplace.

Newly i ntr oduced paras are :

For exports made w.e.f 1st January 2011, the above Paragraph shallbe replaced as under:

For products/markets listed in Appendix 37A, 37C, 37D that areeligible for benefit under Chapter 3 of FTP, exporters shall declaretheir intention to claim benefit by stating in all categories ofShipping Bills as under:

I/We, hereby, declare that I/We shall claim the benefits, asadmissible, under Chapter 3 of FTP.

Contd


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57

This declaration shall also be required on export shipments under

any of the Schemes of Chapter 4 or Chapter 5 or Chapter 6 of FTP aswell as on Bills of Exports filed for Supply to SEZ. No claim under

Chapter 3 shall be admissible without this declaration. However,

Schemes names are not required to be mentioned in the declaration

of intent.

Further, for products / markets notified during the year, the

declaration of intent shall be necessary for exports under all

categories of Shipping Bills only after a grace period of one month

from the date of relevant Public Notice which notifies such product

/ market. For exports made prior to date of notification (i.e. the

date of the relevant Public Notice which notified such product /

market), such a declaration will not be required since export

shipments have already taken place.

Remarks: Procedural clari f icat ion.

Chapter 4-FTP

Duty Exemption &

Remission Schemes


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59

PARA 4.1.10- Advance Authorisation

for Annual Requirement

Sentence in bold is added in first sub para. Remaining

sub paras remain unchanged.

Advance authorisation can also be issued for annual

requirement. Imports are exempted from payment of

basic customs duty, additional customs duty,

education cess, antidumping duty and safeguard duty,

if any.

Remarks:

This is just compliance, which was otherwise due;since goods impor t ed are not meant for domest icconsumpt ion.

60

GEMS AND JEWELLERY

PARA 4A.1.1

Word in bold is deleted from the sentence

Replenishment authorisation may also be issued for

consumables & tools as per paragraph 4A.28 of HBP v1.

Remarks:

Tools are not input s and hence this delet ion.


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Chapter 4-HBPDuty Exemption &

Remission Schemes

62

PARA 4.7.1 - Entitlement

i) Words in bold are added in the second sub para

However, in cases where NC has already ratified norms

for same export and import products in respect of an

authorization obtained under paragraph 4.7, such norms

shall be valid for a period of one year, both with

retrospectively as well as prospectively, reckoned from

the date of ratification.

Contd


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63

PARA 4.7.1 - Entitlement

ii) Sentence in bold is added at the end of third sub para

In such cases Authorisations shall be issued by RA concerned under

"Adhoc Norms Fixed" category and application copies need not be

forwarded to NC for fixation / ratification of norms. Where the

application has already been forwarded before the ratification of

Norms, the RA shall finalise the case as per the norms

subsequently ratified by NC in a similar case.

Remarks:This would solve the problems of pending cases for redemption

purposes, pr ovided the provision is implemented in tr ue spir it .

64

PARA 4.20 - Facility of Clubbing

Sentence in bold is added at the end of the para

Facility of clubbing shall be available only for redemption/regularisation of cases and no further import or export shall beallowed. For this facility, authorisations are required to havebeen issued under similar Customs notification even pertainingto different financial years. However in case of Authorisationsissued in 2004-09 period and thereafter, Advance Authorisationswith different customs notification can be clubbed. Advanceauthorisation for annual requirement can also be clubbedwith the advance authorisation.

Remarks:Long overdue amendment f inall y approved.


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65

PARA 4.21 - Enhancement/ Reduction in the value ofAuthorisation

Bold words are deleted, in the first sentence of this para

In respect of an Advance Authorisation, RA concerned (as

per their financial powers) may consider a request for

Remarks:Al l enhancement / reduct ion t o be carr ied out byregional authority, only procedural simplification.

66

GEMS AND JEWELLERYPARA 4A.28 - Replenishment Authorisation for Import ofConsumables etc.

Words in bold are added in the first sub para

A replenishment authorization for duty free import ofConsumables, Tools and other items namely, Tags and labels,Security censor on card, Staple wire, Poly bag (as notified byCustoms) for Jewellery made out of precious metals (other thanGold & Platinum) equal to 2% and for Cut and Polished Diamondsand Jewellery made out of Gold and Platinum equal to 1% of FOBvalue of exports of the preceding year, may be issued on productionof Chartered Accountant Certificate indicating the exportperformance. However, in case of Rhodium finished Silverjewellery, entitlement will be 3% of FOB value of exports of suchjewellery. This Authorisation shall be non- transferable and subjectto actual user condition.

Remarks:Good Provision


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Chapter 5-FTPExport Promotion

Capital Goods

Scheme

68

PARA 5.1 Zero duty EPCG Scheme

i) The additional products are added in second sub para.

The added products are marked in bold.

The scheme will be available for exporters of

engineering & electronic products, basic chemicals &

pharmaceuticals, apparels & textiles, plastics,

handicrafts, chemicals & allied products, leather &

leather products, paper & paperboard and articles

thereof, ceramic products, refractories, glass &glassware, rubber & articles thereof, plywood and

allied products, marine products, sports goods and

toys subject to exclusions as provided in HBP Vol. I.

Contd


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ii) In third sub para, the operational period of Zero duty

EPCG Scheme is extended for the further period of one

year. The old and new sentence is as under:

Old sentence of third sub para:

The zero duty EPCG scheme will be in operation till

31.3.2011.

New sentence of third sub para:

The zero duty EPCG scheme will be in operation till

31.3.2012.

Remarks:Zero Dut y EPCG scheme has been ext ended by onemore year till 31.03.2012.

70

PARA 5.2D EPCG Authorization for Annual

Requirement

New para added, which reads as under:

EPCG Authorization can also be issued for annual

requirement to Status Certificate Holders and all other

categories of exporters having past export performance

(in preceding two years), both under zero duty and 3%

duty Schemes. The annual entitlement in terms of duty

saved amount shall be upto 50% of FOB value of Physical

Export and / or FOR value of Deemed Export, inpreceding licensing year.


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71

PARA 5.2D EPCG Authorization for Annual

Requirement

Remarks: Good provision.

Export er shall now have the flexi bili t y t o get a high valueEPCG authorisation by filing application on Annual basis,inst ead of mult iple i ndivi dual appli cat ions.

It wi ll reduce paper work against fi ling of mult ipleapplications and monitoring thereof.

It wi ll also reduce t ransact ion t ime and cost .

It is appli cable only t o t he St atus Holder AND othercategories of exporters having export in atleast precedingtwo years.

The upper li mit of dut y saved amount f or t he purpose ofEPCG authori sati on is li mit ed to 50% of preceding year sexports.

Chapter 5-HBP

Export Promotion

Capital Goods

Scheme


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73

PARA 5.1A Exclusions under Zero

Duty EPCG Scheme

Second and third sub paras are amended. The amended

paras are as under:

Chapters 1, 2, 4 to 24, 25 to 27, 31, 43, 44 (except

plywood and allied products), 45, 47, 68, 71, 81 (metals

in primary and intermediate forms only), 89, 93, 97, 98.

ITC(HS) 4011 to 4013, ITC(HS) 7401 to 7406, 7501 to

7504, 7601 to 7603, 7801,7802, 7901 to 7903, 8001, 8002

and 8401. However, zero duty EPCG Scheme will be

available for handicraft exports under Chapters 5, 68,97.

74

Remarks:

Benef it of t he scheme is expanded to cover paper & paperboard andarticles thereof, ceramic products, refractories, glass & glassware,rubber & art icles t hereof, plywood and alli ed product s, mari ne

product s, sport s goods and t oys and addit ional engineeringproducts.

Since t here is addi t ion and delet ion i n Chapt ers and ITC (HS) codes,

it is necessary t o check t he exclusion li st carefull y before availi ng ofZero Duty EPCG Scheme. (The l ist is given below)

44Chapt er deleted f rom Zero EPCG

Scheme for Handicraft Export s

7201 to 7212, 7218 to 7220, 7224

to 7226

ITC (HS) delet ed f rom exclusion

list

4011 to 4013,ITC (HS) added under exclusion

list

3, 40, 44 (except plywood andalli ed products), 48, 49, 69, 70

Chapt ers delet ed f rom exclusionlist


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75

PARA 5.2A EPCG Authorisation for

Annual Requirement

New para added, which reads as under:

The Authorization for Annual Requirement will be issued subjectto the following conditions in addition to other terms andconditions governing the EPCG scheme:-

Authorizations shall be issued with a specific duty saved amountand corresponding export obligation. The applicant would berequired to indicate export products proposed to be exportedunder the authorization.

The authorization holder shall also be required to submit a NexusCertificate from an independent Chartered Engineer (CEC) inAppendix 32A, to the Customs authorities at the time of clearance

of imported capital goods. A copy of the CEC shall be submitted tothe concerned Regional Authority along with copy of the bill ofentry, within 30 days from the date of import of the CapitalGoods.

Contd.

76

Remarks: Procedural simpli f icat ion.

Now EPCG authori sati on for annual requirement can begrant ed upto 50% (dut y saved value) on FOB value of pr ecedingyears export s.

Detai ls of products proposed t o be export ed should be givenwhile f il i ng initi al applicat ion.

Nexus certificate as per prescribed format is to be submittedat t he time of physical i mport , at Cust oms aut hori t y i nst ead atinitial stage of application with concerned RA. Thereafter,copy of the same should be submitted to RA along with Bill ofEntr y, wit hin 30 days of import . In other words, nexus will bemonit ored by Cust oms inst ead of Regional Authori t y.

This provi sion would be very useful t o lar ge companies whereall details of imports are not finalised in advance. It willreduce the application fees substantially.

Very welcome provision.


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Chapter 8-HBPDeemed Exports

78

PARA 8.3.1 Procedure for claiming Deemed Exports

Drawback & Terminal Excise Duty Refund / Exemption

First point of the para is substituted as under

Words in bold are added

An application in ANF 8 along with prescribed documents, shall bemade by Registered office or Head office or a branch office ormanufacturing unit ofsupplier to RA concerned. Where applicantis branch office or manufacturing unit of a supplier, it shallfurnish self certified copy of valid RCMC. Recipient may also claimbenefits on production of a suitable disclaimer from supplier in theformat given in Annexure III of ANF 8 along with a self declaration

in the format given in Annexure II of ANF 8 regarding non-availmentof CENVAT credit in addition to prescribed documents.

Remarks:Good procedural simpli f icat ion.


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79

NOTE:

There are no practical changes made in the following chapters:

Chapter 1C-FTP - Board of Trade

Chapter 2-FTP - General Provisions Regarding Imports and

Exports

Chapter 6-FTP and HBPv1 - Export Oriented Units (EOUs),

Electronics Hardware Technology Parks (EHTPs), Software

Technology Parks (STPs) and Bio-Technology Parks (BTPs)

Chapter 8-FTP - Deemed Exports

Chapter 9-FTP - Definitions

Chapter 9-HBP - Miscellaneous Matters

Updates on SEZ


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81

Fact Sheet on Indian SEZ

No. of Notified SEZs as on 20.07.2010 358 (out of 575) +

(7 Central Govt. + 12 State/Pvt. SEZs)

No. of valid formal approvals 576

No. of valid in-principle approvals 155

Operational SEZ as on 31.12.2009 114 (Out of these 14 are

multi-product SEZs, remaining are IT/ITES, Engineering,

electronic hardware, textiles, Biotechnology, Gem& Jewellery

SEZs and other sector specific SEZs)

Units approved in SEZs as on 30.06.2010 3,048

Source: www. sezindi a.ni c.i n

82

SEZs-Area Requirement

Area Estimates

[approx]

(in hectares )

SEZ

1,98,992Total Area for proposed SEZs

1,29,668In-principal approvals

69,324Formally approved and notified

SEZs


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83

Fact Sheet on Indian SEZ

2,00,327 personsEmployment in Govt. SEZs

2,89,738 personsEmployment created in

notified SEZs (as on 30th

June 2010)

Rs. 1,49,744.55 crTotal Investment made in

notified SEZs (as on 30th

June 2010)

84

Fact Sheet on Indian SEZExports from the functioning SEZs during the last three years are as

under:

121.40%2,20,711.392009-2010

50%99688.872008-2009

93%666382007-2008

52%346152006-2007

24.71%22,8402005-2006

32%18,3142004-2005

39%13,8542003-2004

Growth Rate of exportsExports (Rs. crores)Year

Exports in 2010-11 as on 30.06.2010 - Rs. 58,685.46 crore


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Changes effectedtill August 2010

86

SEZ Draft Guidelines Dtd.13.11.09 -

Guidelines for Development of SEZs

Draft Guidelines were issued by the Ministry of

Commerce and Industry (MoC&I) on 5th August, 2009 and

were circulated to SEZ Developers. On getting

suggestions from the SEZ developers, revised draft

guidelines are issued by this notification.


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87

S.O. 75 Dtd. 13.01.2010

On 13th January, 2010 following sections of SEZ Act, 2005 have been

operationalised

Sections 20-Agency to inspect Section 21-Single enforcement officer or agency for notified

offences

Section 22-Investigation, inspection and search or seizure.

S.O. 76 Dtd. 13.01.2010

MoC&I specified acts or omissions punishable under the Foreign Trade

(Development and Regulation) Act, 1992 (28 of 2005) as notified

offences for the purposes of the Special Economic Zones Act, 2005.

S.O. 77 Dtd. 13.01.2010

MoC&I authorizes Development Commissioner [DC] to be the

enforcement officer in respect of the notified offences [as given in S.O.

76 Dtd. 13.01.2010] committed in a SEZ.

88

S.O. 78 Dtd. 13.01.2010

Director STPI would no more be In-charge of SEZ particularly IT/ ITES/Software SEZs.

S.O. No. 228 Dtd. 03.03.2010 Very important amendment. SEZs are authorized as deemed

licensee for the purposes of distribution of electricity. Hence notified SEZs (notified under sub-section (1) of section 4 of

the SEZ Act, 2005) need not make application for obtaining licencefor distribution of electricity under clause (b) of Section 14 of theElectricity Act, 2003.

S.O. No. 527 Dtd. 03.03.2010 Clause (u) of section 2 of the Special Economic Zones Act, 2005

(definition of offshore banking unit) would not apply to offsite

Automated Teller Machines [ATM] in the Special Economic Zones,and branches in Special Economic Zones by Banks, not licensed as

Offshore Banking Units; with the prior permission of the ReserveBank of India under section 23 of the Banking Regulation Act,1949.


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89

G.S.R. 501(E) Dtd. 14.06.2010

Amends SEZ Rules, 2006

Rule 3, 5, 6, 8, 9, 11 and 12 are amended and Rule 3A, 6A and 78

are inserted. By this notification, following Forms are also added.

APPLICATION FOR APPROVAL OF AUTHORISED OPERATIONSForm-C7

APPLICATION FORM FOR DENOTIFICATIONForm-C6

APPLICATION FOR DECREASE IN AREAForm-C5

APPLICATION FOR INCREASE IN AREAForm-C4

APPLICATION FOR SEEKING CHANGE IN SECTORForm-C3

APPLICATION FOR EXTENSION OF VALIDITY OF APPROVAL GRANTED

UNDER RULE 6(2)(b)

Form-C2

APPLICATION FOR EXTENSION OF VALIDITY OF APPROVAL GRANTED

UNDER RULE 6(2)(a)

Form-C1

APPLICATION FORM FOR APPROVAL OF CO-DEVELOPERForm-A1

Explanation on each amendment/insertion of rule is provided in

EPCES Cir. No. 113 Dtd. 14.07.2010.

90

G.S.R. 597(E) Dtd. 12.07.2010 Amends

Rule 5 (2) (b) of SEZ Rules, 2006

This notification amends Rule 5 (2) (b) related to sector specific

SEZ. The inserted proviso prescribes minimum built up area for

SEZs located in the cities as categorized under Annexure-IV.

Annexure IV is also inserted by this notification. The minimum built

up area prescribed is as under:

Third Proviso of Rule 5(2) (c) related to FTWZ is also amended. The

proviso says that in SEZ for a specific sector, FTWZ may bepermitted with no minimum area requirement, provided maximum

area of FTWZ should not be more than 20% of processing area. This

criterion under third proviso was applicable to Sector Specific SEZ,

now after amendment, this provision is made applicable to SEZs

having area less than 1000 hectares.

25% of the area specified in Rule 5(2)(b)B2 category cities

50% of the area specified in Rule 5(2)(b)B1 category cities


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91

EPCES Cir. No. 100 Dtd. 08.01.2010

This circular is issued referring A.P. (DIR Srs.) Cir. No. 22Dtd. 29.12.2009. In this circular it was clarified that SEZ

developers are allowed to open, hold and maintain EEFC

account and to credit up to 100% of their foreign exchange

earnings.

EPCES CIRCULAR NO. 104 DATED 2-3-2010 IT/ITES SEZs can also house electronic hardware units in

these SEZs.

For setting up a unit in the SEZ, where Industrial Licence is

required, permission can be given by Board of Approvals.

92

EPCES CIR. NO. 112 DTD. 16.06.2010 - Revised discussion paper on Direct

Tax Code, released by Ministry of Finance on 15-6-2010.

Very important circular relating to revised discussion paper on Direct Tax

Code (DTC) released by Ministry of Finance on 15th June, 2010.

Finance Minister has proposed in Revised DTC paper for discussion, in

Chapter VII that, provision to protect profit linked deductions of units

already operating in SEZs, for the unexpired period, will be incorporated.

However, he has further clarified that since Profit linked deductions are

distortionary in nature as they create an incentive to inflate profit as well

as to transfer profits from a taxable entity to a non-taxable one, it has

been decided not to extend the scope or the period of profit linked

deductions.

This amendment only meets the requirement of SEZ partially, as it protects

only the existing SEZ units. This would practically close the door for new

investment in the SEZ and hence, Dr. L.B. Singhal DG, EPCES, has invited

representations from the Industry upto 30.06.2010.


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93

Instruction No. 37 Dtd. 07.09.2009 Clarification on whetherimport, re-melt, re-make and export of imported finished jewelleryis an authorized activity in SEZIn view of the provisions contained in Section 2(r) of SEZ Act, 2005 readwith Rule 27(1) of SEZ Rules, it is clarified that import of jewellery andits remaking is an authorised manufacturing activity by an SEZ unitholding letter of approval for manufacturing of jewellery. Furtherimport would include re -import of exported jewellery.

Instruction No. 38 Dtd. 11.09.2009 - SEZ Online Project.MoC is executing agreement with NDML for SEZ online project. This isto establish a nationwide integrated e-governance solution for theadministration of SEZ and to facilitate speedy processing oftransactions of SEZ Developers SEZ units.

Instruction No. 39 Dtd. 11.09.2009 - Procedure for consideration ofoperational issues regarding SEZs.

Very important instruction. For approvals or operational issues relatedto SEZ, the matter should be referred to Unit Approval Committee[UAC] or Board of Approval [BoA] and not to the individual Departmentsof Government of India.

94

Instruction No. 40 Dtd. 01.10.2009-Effective implementation of the

Hazardous Waste Rules, 2008For ensuring compliance with Hazardous Waste Rules, 2008, following

recommendations are made by the Ministry of Environment and Forests[MOEF].

Officers of the State Pollution Control Boards [SPCBs] are advised to

attend the meetings of the Approval Committee and assist the

Development Commissioner [DC] in ensuring compliance of the

environmental regulations, especially Hazardous Waste (Management,Handling & Transboundary Movement) Rules, 2008.

SPCBs are also advised to monitor the units which are recycling/

reprocessing imported waste on a regular basis.

Instruction No. 41 Dtd. 13.11.2009 - Clarification on calculation of NFE

as per Rule 53 of the SEZ Rules, 2006NFE is to be calculated in rupee terms only. In cases where SEZ unit

achieves negative NFE due to foreign exchange fluctuations, they can

approach Approval Committee. However, in such cases, SEZ unit will have

to get the computations certified by the Authorised Bank, on a case to

case, basis.


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95

Instruction No. 42 Dtd. 18.11.2009 - Guidelines for consideration of

proposals for authorized operations by the BoA.All requests for carrying out authorized operations, whether covered in

the default list or not, are to be made initially to the concerned

Development Commissioner [DC]. The DCs will send only such

requests/items for consideration by BoA, which are outside their

powers with their recommendations.

Instruction No. 43 Dtd. 23.11.2009 - Procedure for seeking

clarification on policy issues relating to SEZ Act and Rules from

Department of Commerce.

This is to facilitate speedy disposal at the hands of Zonal DC related to

procedure for seeking clarification on policy issues relating to SEZ Act

and Rules from Department of Commerce

96

Instruction No. 44 Dtd. 24.11.2009 - Reports to be furnished by DCsfor review/monitoring of performance of SEZs

DCs are required to submit monthly reports for reviewing/monitoringof performance of SEZs in the prescribed forms A to F, formats ofwhich are given in the Instruction. Further, Zonal DCs are also requiredto submit such reports in the Format G and H. Following is the list ofthese formats.Format of monthly reports to be furnished

By DCsA. Approval of activities under SEZ Rules 17 & SEZ Rules 18,19B. Other PermissionsC. Permissions under Rule 74D. Statement on monthly Data on Export Duty, Import Duty and Duty

ForegoneE. Import and Export DataF. Statement in respect of SEZ Developers coming under the

Jurisdiction of DCI. Information regarding staffing positing in SEZs.

By Zonal DCsG. INFORMATION on CST claims and drawbackH. [No title is given, however, information relates to built up and land

space]


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97

Instruction No. 46 Dtd. 12.01.2010 - Setting up of small

scale units in Central Government SEZ

Development Commissioners of Central Govt. SEZ should give

preference to small scale units as defined under the Micro,

Small and Medium Enterprises Development Act, 2006.

DCs of the IT/ITES SEZs are required to ensure that the

IT/ITES SEZs are advised to set up incubators of size of

minimum 200 seats and the minimum 10% of the space in the

SEZ may be reserved for SSI IT/ITES units.

All other SEZs should allocate 10% space to SSI units.

98

Instruction No. 47 Dtd. 04.03.2010 - Procurement, Import andExport of Prohibited and Restricted Goods

Following clarifications are provided in respect of procurement, Importand Export of Prohibited and Restricted Goods Export of prohibited items is permitted provided required raw

materials are imported.

Items which are prohibited for import can also be imported by SEZUnits if such imports are made for manufacturing export goods.

In respect of supply of Restricted Items by a DTA unit to SEZDeveloper/Unit, the DTA unit can supply such items to a SEZDeveloper or unit for setting up of infrastructure facility or forsetting up of a unit.

DTA units can also supply restricted raw materials to SEZ unit forundertaking a manufacturing operation except refrigeration,cutting, polishing and blending.

However for all the above activities Prior Approval from Board ofApproval is required.


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99

Instruction No. 49 Dtd. 12.03.2010 - Clarifications on FTWZ issues

Ministry of Commerce & Industry has issued clarification on followingissues related to FTWZs. No approval for procurement of service Rental of immovable

property for office outside the Special Economic Zone/FTWZ canbe given.

Import of prohibited items will be as per Rule 27, Rule 26 andInstruction No.47 Dtd. 04.03.2010.

Diesel is permitted to be procured for authorized operations in theprocessing area including material handling equipment.

There are no limitations on Units set up in FTWZs located in SectorSpecific SEZs to carry out Trading and Warehousing Activities inrespect of any product.

Trading and Warehousing units located within FTWZ can carry outDTA to FTWZ and FTWZ to DTA transactions.

Requests for allowing cutting, polishing, blending etc. as part of

authorised operation of a FTWZ unit can be considered by theApproval Committee on a case to case basis based on the merits ofthe case.

100

Instruction No. 51 Dtd. 25.03.2010 - Declaration of Raw materialcomponents etc. imported by G&J units in respect of goods to be

manufactured by them

Important circular for G&J units in SEZ.

In terms of Rule 17 of the SEZ Rules SEZ units are required to file a

declaration in Form-F while submitting an application for setting

up of a unit. The Approval Committee considers the same before

granting Approval for issue of LOA.

In this connection, procedure prescribed in this instruction should

be followed by all G&J units for bringing in jewellery, broken

jewellery etc. for remaking, remelting, repairing, etc.

Instruction No. 52 Dtd. 20.04.2010 - Clarification on broad- banding

in IT/ITES Sector SEZIt is informed by this instruction that no approval of BoA is required in

case of developers in IT/ITES sector to broad-band their product

profile by including electronic hardware. This is because IT/ITES

includes both Hardware and Software.


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101

Instruction No. 58 Dtd. 21.05.2010 Allowing of authorized

employees of IT/ITES units in SEZ to work from home.

Off-site employees of the IT/ITES units in SEZ are also permitted to

work from home or from place outside the SEZ. It is also stated in theinstruction that IT units in DTA can carry out their job-work in a SEZ

Unit by following procedures mentioned in Rule 43 of SEZ Rules, 2006.

Instruction No. 59 Dtd. 18.06.2010 - Requests for transfer of units

from one SEZ to another SEZ

Board of Approval [BoA] permits shifting of units from one SEZ to

another SEZ, provided all such proposals are placed before the BoA.

Instruction No.60 Dtd. 06.07.2010 Clarification on holding of

goods by units in FTWZ.

Doubt raised by the FTWZ Developers: Whether units in the FTWZ

can hold goods on behalf of Foreign Buyer, DTA Supplier and Buyer.

Clarification provided by Department of Commerce: Subject toprovisions of Rule 18 (5) of SEZ Rules, 2006, FTWZ units can hold

goods on behalf of foreign supplier and buyer and DTA supplier and

buyer.

102

Instruction No. 61 Dtd. 14.07.2010 Withdrawal of Instruction Nos.36, 25, 24 and 16.

Following instructions are withdrawn

Instruction No. 36 Dtd. 03.09.2009 Instructions regarding

proposals to be considered by BoA

Instruction No. 25 Dtd.16.07.2009 Guidelines regarding Putting

up of a boundary wall

Instruction No.24 Dtd.16.07.2009 Guidelines for dealing with

Requests for change in area of SEZs

Instruction No. 16 Dtd. 11.06.2009 - Validity of Formal Approval

This is because issues addressed in these instructions are now

considered and carried out in the SEZ Law, by amending the SEZ Rules,

2006 by G.S.R. No. 501 Dtd. 14.06.2010.


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103

Instruction No. 62 Dtd. 23.07.2010 Procedure for clearance of

State SEZ Bills.

This is regarding faster procedure for clearance of State SEZ Bill. It isdecided that Department of Commerce will create consensus of all

concerned Departments and will send the recommendations and No

Objection of concerned Departments of Government of India to the

Ministry of Home Affairs [MHA] for final approval and MHA would get

the assent of the President on the Bill.

Instruction No. 63 Dtd. 10.08.2010- Procedure regarding removal of

goods to bonded warehouse under Rule 46(13) of SEZ Rules, 2006

Procedure for removal of goods from SEZ unit to the Bonded

Warehouse under Rule 46 (13) of SEZ Rules, 2006 has been prescribed

in this Instruction.

Instruction No. 64 Dtd. 11.08.2010 Role of Zonal DCsThis Instruction is about responsibilities allocated to the Zonal

Development Commissioner [DC].

104

Thought for the Day

T h e b e a u t y o f li fe is , w h i le w e ca n n o t u n d o

w h a t i s d o n e , w e ca n s e e i t , u n d e r s t a n d i t ,

le a r n f r o m it a n d ch a n g e .

S o t h a t ev e r y n e w m o m e n t is s p en t n o t in

re g re t , g u i l t , f e a r o r a n g e r , b u t i n

w is d o m , u n d e r s t a n d i n g a n d l ov e .

- B u d d h a


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105

Mumbai - Head Off.

A-203, Everest Chambers,

Next to Star TV Office,Near Marol Naka, Andheri-Kurla Road,Andheri (East), Mumbai 400 059.Tel: 022-28507615/28507329/65769126Fax: 022-28506419E-mail:

Pune - Branch Off.EPI Centre, Opp. Indsearch,

Law College Road, Pune 411004.Tel: 020-65246159Fax: 020-25465195

Email:[email protected]

Sudhakar Kasture

Revised Ftp

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