 |
OFFICE OF THE
COMMISSIONER OF CUSTOMS, |
PUBLIC NOTICE No. 01 /2001
Sub:
Duty Free Replenishment Certificate (DFRC) Scheme introduced vide Para 7.4 of the Exim
Policy announced on 31.03.2000
Attention
of all Importers and Exporters, CHA’s and all other concerned is invited to Public
Notice no. 175/2000. For proper functioning of the Scheme,
following detailed guidelines are issued for information of the trade
2.
SCHEME:
2.1 Under the Duty Free
Replenishment Certificate (DFRC) Scheme exporters are eligible for import of inputs used
in the manufacture of goods without payment of Basic Customs Duty, Surcharge and Special
Additional duty, but import goods will be leviable to additional Customs duty equal to
Central Excise Duty and Anti dumming duty/ Safeguard duty, wherever applicable. The exports under this Scheme are
permissible in respect of only those export products, which are covered under Standard
Input-Output Norms as notified by DGFT in Volume II of the Hand Book of Procedures. However, goods for which Standard Input
– Output Norms are fixed with Actual User Condition, benefit under DFRC Scheme, shall
not be available. The exporters are
therefore requested to ensure that while exporting under DFRC Scheme the goods are covered
under SION fixed by DGFT and such norms are not with Actual User Condition.
2.2 As per General Note 2
of the Customs Notification No.41/2000 Cus(NT). dated 01.06.2000, issued to notify All
Industry Rates of Drawback goods exported under DFRC Scheme are eligible for Central
Excise portion of All Industry Rates of Drawback subject to the condition that no CENVAT
is availed on the export goods. All Industry Rates of Drawback are fixed giving two rates
when CENVAT not availed and other and when CENVAT has been availed. In category, where CENVAT has not been
availed, both Customs and Central Excise portion of All Industry Rates of Drawback are
admissible and when CENVAT availed, only Customs portion of All Industry Rates of Drawback
is admissible. Thus, if exports are
being made by not availing the CENVAT facility, the exporters will be eligible to only
Central Excise portion of All Industry Rates of Drawback.
However, if exports are being made by availing CENVAT facility, the exporters will
not be eligible for any drawback because he is eligible for only Central Excise portion
which is NIL.
It may thus be ensured that Central Excise portion of All Industry Rates of
Drawback is claimed only if the exporter has not availed the CENVAT on the export goods. The exporters in token of the fact that
CENVAT facility has not been availed would be required to produce a copy of AR4 or a
certificate from the concerned Central Excise Office to prove their claim.
2.3 The exporters
operating DFRC Scheme shall give declaration on all the copies of the shipping bill
indicating Sl.No. & Product Group of the
export product as per SION of Hand Book of Procedures Vol II. The said shipping bill (s) shall also
contain declaration regarding the quality, technical characteristics of the inputs used in
the export product as is being done in respect of DEEC Shipping Bills.
2.4 The DFRC shall be
issued for import of inputs as per Standard Input-Output Norms having same quality,
technical characteristics as of those
inputs used in the export products and is indicated in the shipping bill, in order to
avoid any disputes at the time of Imports, the exporters are advised to mention SION No.
on each Shipping Bill. The list of all
inputs and technical characteristics of each input shall be mentioned on the Shipping bill
along with the quantity used.
2.5 As an illustrative
example, say an exporter intends to export ready-made garments and Duty Free Input is
Fabric. The following details in respect of
fabrics are necessary: -
(i)
Composition
of fabrics i.e. percentage of various fibres and in case of sythetic fabrics whether
fabric is made of spun yarn or filament and whether made of textured filament or not.
(ii)
Whether
the fabric is dyed, printed or yarn dyed with multi-colour
yarn.
(iii)
GSM
of the fabrics used and denier of yarn used.
(iv)
Whether
woven fabrics knitted fabrics and in case of knitted fabrics, whether the same is pile
fabrics or looped piled fabrics etc. ; The
composition of knitted fabrics shall be mentioned.
2.6 Similarly, in respect
of exports of plastic items the exporters shall declare type of plastics used in the
export product and grade of the Polymer. The
exporters of Engineering goods shall declare type of steel used and composition of the
goods exported so that import of similar goods may be allowed without any dispute. In case the technical characteristic cannot
be declared on the body of shipping bill, same Amy is declared on separate sheet, which
shall be attached with each copy of shipping bill.
2.7 The DFRC Scheme is
available only if exports are made in freely convertible currency. If exports are being made in Rupee Currency
the benefit under DFRC Scheme shall not be available.
3.
REGISTRATION:
-
Any
exporter (merchant exporter or manufacturer exporter) desirous of operating under DFRC
Scheme through Chennai Customs (Sea port) shall first obtain registration number before
presenting his first shipping bill for export under the Scheme. This will be a one time unique ten digit
registration number for each exporter. The
first 3 digits of Registration number will denote port code number is 601 for Chennai
and subsequent 5 digits denote serial number of registration during the year 2000. For obtaining the registration number, the
exporter shall furnish his profile (in duplicate) as per Annexure IA of HB of procedures
– Vol I (1997-2002) in Group –VII of this Custom House, which will be verified
by the designated Officer and thereafter the registration number, as aforesaid shall,
after feeding in the profile data in computer, be generated on the computer system. The number so generated shall be endorsed on both
the copies of exporter’s profile and thereafter duplicate copy of the Profile shall
be given back to the exporter whereas the Original Profile copy shall be retained in the
department for record.
DOCUMENTATION
AND PROCEDURES FOR EXPORT
4.1 (i) the
exporters exporting goods under DFRC Schemes without claiming
drawback shall file a
‘shipping bill for export of dutiable goods’
(where export duties are leviable or “ shipping bill for export of duty free
goods (White shipping bill)” (where no
export duties are leviable). On the top
of the shipping bill they should write “Export
Under DFRC Scheme” on each copy. The
exporters will file the said shipping bill in quadruplicate, original to be retained in
the Custom House, duplicate for recording examination order and to be retained by Custom
House in docks. The triplicate shall be
Export Promotion Copy and on the top of it “E.P. Copy” shall be mentioned. Quadruplicate shall be DFRC copy on which the
examination report shall be recorded. On
quadruplicate it shall be specifically mentioned “DFRC Copy” and shall be
retained by the exporters.
4.1 (ii) The exporters intending to claim Drawbacks as
well as benefit under DFRC shall file
“Green Shipping Bill for export of goods under claim for Duty Drawback”, in
quintuplicate. On each copy exporter shall
write "Shipping Bill for export of goods under claim for duty drawback and
DFRC”. The original copy will be
retained by the Customs Department, Duplicate for recording examination report and to be
retained by Custom House Docks. Triplicate
copy shall be Export promotion copy, Quadruplicate copy shall be Drawback Copy and
Quintuplicate shall be DFRC copy to be retained by the exporter. Examination Report will be recorded on duplicate,
triplicate, quadruplicate and quintuplicate copies. The
Drawback shall be claimed on the strength of Drawback Copy.
4.1. (iii) all the
columns of the shipping bill shall be properly filled in (either by typewriting or by
computer printing) either by the exporter or his authorised Custom House Agent. All the relevant informations like FOB value,
Gross Weight, Net Weight, Units being exported shall be written in numbers as well as
letters.
The Exporter shall prominently mention on the
shipping bill, DFRC section computer registration number for exports under DFRC Scheme. As stated above the exporter shall obtain this
number from the Computer Cell of the DFRC Section before he presents his first shipping
bill for export, under the Scheme. Thereafter,
this number shall invariably be inscribed on the succeeding shipping bill (s).
4.1 (iv) At the
bottom of the shipping bill, there shall be following declarations:
(e) I / We am/are
exporting these goods under DFRC Scheme in terms of Para 7.4 of the EXIM Policy
(1997-2002).
(f) I / We shall not claim any benefit
under Advance licence of Duty Entitlement Pass Book Scheme in respect of export made
against this shipping bill.
(g) The goods are covered by SION S.No. ........
of Product Group Code
No......... Of
HB of procedure vol.II.
(h) I / We declare that all particulars given
herein are true and correct.
4.1 (v) The reverse side of the duplicate shipping
bill will be the same as shipping bill for export of duty free goods, in case no Drawback
is being claimed and in case Drawback is being claimed, reverse side of the duplicate
shipping bill will be the same as shipping bill under claim for Drawback.
4.1 (vi) the
triplicate copy in case of duty free/dutiable DFRC.Shipping Bills shall be used as Export
Promotion Copy.
4.1 (vii) The
Quadruplicate copy of shipping bill in case of duty free/dutiable goods and quintupicate
copy of shipping bill, in case of claim for drawback will be called as DFRC copy, the
reverse side of this copy as well as duplicate copy shall bear the (examination) order and
examination report along with Customs Let-Export Order.
4.2 The DFRC
shipping bill in quadruplicate/quintuplicate, as the case may be, as stated above, after
obtaining a one time DFRC Section Registration Number (as mentioned in the previous para)
will be presented in the computer cell, where Thoka Number will be assigned to the
shipping bill. Thereafter, the shipping bill
along with relevant GR Forms will be presented for assessment in Group VII. The assessment will be done by the Appraising
Officer and will be counter signed by the Dy.Commissioner/Asst.Commissioner. The examination order will be endorsed on the both
duplicate as well as triplicate copy of
the shipping bill.
4.3 Samples under DFRC scheme will
be drawn for test only where testing is necessary with reference to a
specification/content of inputs or technical characteristic etc. In such cases, the samples of the first
consignment shall necessarily be sent for test. The
subsequent samples shall be sent for test on the basis of one out of ten consignments to
be drawn at random and with an element of surprise. However,
in case of manufacturer exporters who have in-house testing facilities, samples may not be
drawn and in-house test results shall be relied upon., provided the in-house testing
facility of the manufacturer exporter has been recognised as follows:
(a)
The
manufacturer exporter has been awarded GMP (Good Manufacturing Practices) certificate by
the concerned Drug Controller; or
(b)
The
in-house testing facilities are approved by ISI/CSIR/Ministry of Science and Technology or
the nodal Ministry; or
(c)
The
Manufacturer exporter has been awarded ISO Certification.
In such cases, the exporter would have to enclose a copy of the in-house Test
Certificate with the Shipping Bill. The above
facilities are for expeditious clearance. The
Customs, however, will have the right to draw samples by surprise and go for a detailed
verification/testing etc.
4.4.
On
account of declared FOB or classification of goods under a particular SION , drawal of
samples or for other reasons where it is not possible to assess the shipping bill finally,
the shipping bill shall be assessed provisionally and all copies of such shipping bills
shall be prominently stamped with the endorsement “Assessed Provisionally
pending......... not entitled for DFRC before assessment is finalised.
4.5 After assessment by
the Appraising Officers and counter signature by the Asst./Deputy Commr., the shipping
bills (s) particularly, shipping no and date, CHA, description of goods, quantity, Net
wt/Gross Wt, FOB Value, Product group, SION Sl.No. Etc., shall be entered into “
credit module” of computer system.
The entries in the credit module should be made with reference to DFRC Section,
registration no of the exporter. A
separate site shall be allocated for each registration no.
The running serial number of the corresponding entry against which particulars of
the shipping bills have been entered in the computer shall be termed as credit Account
serial number and be prominently stamped on all the copies of the shipping bill. A said credit module will also
have columns for DFRC Licence Number and date and
place of issue, which will be entered at the time of the verification. After entering the details in the
credit module, ten digit security number shall be generated in the computer system and the
same shall be endorsed in all copies of the shipping bill as well as GR forms. Thereafter, the original
shipping bill and the original GR copy will be retained in the computer cell and the
remaining copies of the shipping bills and GR will be handed over to the exporters. Original copies of finally assessed shipping
bill shall be forwarded to MCD on daily basis as per the practice. Original copies of the provisionally
assessed shipping bills however, will be retained in a separate lot till their final
assessment.
4.6
DFRC
will be issued by the Licencing Authority on submission of the finally assessed EP copy of
the shipping bill and other documents within a period of 90 days from the last date of
realization in respect of shipping for which DFRC is being claimed or 180 days from the
last date of realization in respect of shipments for which DFRC is being claimed or 180
days from the date of export against irrevocable Letter of Credit as provided in the
Export-Import Policy and Hand Book of Procedure Vol.1.
In case of provisional assessment exporter(s) will have to get their shipping bills
finally assessed on the basis of the test reports or other required documents before
applying for DFRC to the DGFT. In such
cases application for DFRC shall be filed within 180 days from the date of final
assessment (or release) of shipping bill. In
case of short shipment, exporters will have to furnish EP copy along with short shipment
certificate while applying DFRC to the Licencing Authority.
The extent of short shipment shall be prominently stamped on all copies of the
shipping bills by the officer giving out of charge in the Docks indicating the extent of
short collection in Quantity and value terms.
4.7
All
shipping bills assessed provisionally as per P.N.No.49/2000 dated 24.04.2000 shall be
finalized in view of the instructions contained in this Standing Order.
4.8
In
additional to what is stated above, all other existing instructions for assessment and
examination of export goods shall apply mutatis, mutandis.
5.
Examination of Export: -
5.1
The
export goods shall be examined with reference to the description and technical
specification of the export goods as well as inputs.
As the exporter will be eligible for import of inputs declared in the shipping
bills, due care shall be taken to ensure that the declared inputs have been used in the
export goods so that exporter(s) do not face ay difficulty at the time of Import. Wherever the description of inputs cannot be
ascertained by visual inspection, samples may be drawn with clear instructions of test
requirements.
5.2
If
exporter is claiming Central Excise Portion of All industry Rate of Drawback on the export
goods, the required certificate for non-availment of CENVAT shall be verified at the time
of export. The same instructions shall
be applicable in this regard as in case of normal drawback exports.
5.3
If
an exporter also claims Drawback in respect of those duty paid inputs which are not
covered under SION and whose import is not permitted against DFRC Licence. Officers examining the export consignments
shall ensure that such inputs has been declared and no CENVAT has been availed on such
inputs.
5.4
In
addition to above all, all other existing instructions for examination of export goods
shall apply mutalis mutandis.
6.
PORT
OF REGISTRATION: -
As per the revised HB
of Procedures Vol.1 the applicant may file one or more applications of DFRC subject to the
condition that each application shall contain not more than 25 shipping bills. All the shipping bills in any one
application must relate to exports made from one Custom House only. The application for DFRC against exports
made through Chennai Custom House should therefore, be made separately and should DFRC
shall be issued with single port of registration, which will be the port from where the
exports have been effected.
7.
VERIFICATION:-
DFRC issued by
Licencsing Authority against exports made through, Chennai Custom House, will be verified
by the DFRC Section of Group-VII with respect of DFRC copies of the Shipping Bills
presented by the party and the computer records maintained for this purpose. The Dy.Commr./Asst.Commr will nominate
Appraising Officer and other staff for verification of DFRC Licences. Separate DFRC Licence files contained copy
of DFRC Licence, DFRC copies of shipping bill, Bank certificate of export and realization,
calculation, chart, and other required documents would be maintained in serial order. After the due verification of the
particulars mentioned in DFRC Licence with those in the records maintained in the computer
system and with DFRC copy of the shipping bill and other documents presented by the
exporter, the DFRC Licence shall be endorsed with a stamp “Verified by Customs”
and signed in full with dated signature by the Dy Commr/ Asst. Commr. of Customs, Group-7, bearing a stamp of his name
and designation in Block letters. At
the time of verification DFRC copies of shipping bills will also be endorsed/stamped with
corresponding DFRC Licence number and date. The
details of DFRC Licence No. And date, its value and place of issue shall also be entered
in the credit module against respective shipping bills.
8.
REGISTRATION
OF DFRC.
8.1 Imports and exports
under DFRC Scheme have to be from any one of the specified ports/airports/ICDs etc. In other words, DFRC issued for a particular
port of registration is not valid for import of export through any other port, airport or
ICD. However, Chennai seaport, Air
cargo complex, Chennai shall be considered as a single port for the purpose of DFRC. Therefore, DFRC holder(s) having
DFRC(s) with port of registration “Chennai Seaport”. (for export through any of said two shipping
points) will be allowed to utilize DFRC for
import of payment of duty on eligible items imported at any one of the two ports. i.e. Chennai Seaport and Air Cargo Complex,
Chennai. However, the registration and
subsequent utilization at any of the said two ports shall be allowed only after
verification of DFRC by Customs at the point of exports.
In case DFRC is issued having shipping bill from Air Cargo Complex, Chennai,
verification shall be got done from respective ports for export(s) before registration at
any of the ports. DFRC holder desirous
of utilizing DFRC at Chennai Seaport shall get respective DFRC registered in the Computer
Section after DFRC is verified. The
registration No. Shall be endorsed on the left side top corner of reverse side of DFRC No.
debits against DFRC shall not be permitted unless it is registered in computer section. Registration of DFRC shall be made in debit
module of the system.
8.2
DFRC
holders registered at any of the following seaport(s) airports ICDs are also allowed to
import at any of the following seaports/airports/ICDs:
(i)
Seaports
at Mumbai. Calcutta, Cochin, Kandla,
Mangalore, Chennai, Nhava-Sheva & Visakhapatnam.
(ii)
Airport
Ahmedabad, Bangalore, Mumbai, Calcutta, Delhi, Hyderabad and Chennai.
(iii)
ICD
at Bangalore & Delhi.
8.3
The
aforesaid facility will be operated by issue of Telegraphic Release Advice (TRA) from the
port of registration to the Customs House at which the goods are being imported. The format of TRA will be as per annexure
‘B’ to this Standing Order.
8.4 Where the imports at
Chennai are against TRA issued by any of the above seaports/airport/ICD, the TRA, before
its utilization for payment of duty, will have to be registered in debit module of the
computer information related to name of the Custom station from where the TRA is issued
with their reference file number shall also be maintained in the system. At the time of registration and
assessment original DFRC shall also be required to be presented along with TRA. The other procedure for clearance against
TRA shall be the same as given herein under for DFRC except that debits will be made on
the reverse of TRA instead of DFRC.
9.
IMPORTS:
-
9.1 Any item as per DFRC
shall be allowed for import without payment of basic Customs duty, surcharge and special
additional duty. However, additional
duty of Customs is leviable on goods imported against DFRC, anti-dumping duty and
Safeguard duty wherever chargeable shall also be leviable on goods imported against DFRC
licence.
9.2
Imports
effected against DFRC Licence shall not be cleared under Fast Track/Green Channel Scheme
and would be subjected to normal/check examination Scheme.
9.3. Sourcing of inputs from private bonded warehouses:
The facility of
sourcing inputs from private bonded warehouse under para 5.15 of the Exim Policy shall be
available and for this purpose the provisions of Section 68 of the Customs Act, 1962 shall
be applicable except that the clearance of inputs from bond shall be allowed against DFRC
Licence subject to fulfillment of the terms & conditions mentioned in Notification
No.48/2000, Custom dated 25.04.2000.
9.4. Debiting of DFRC Licence:
No clearance shall be
allowed under Customs Notification No.48/2000-Cus dated 25.04.2000 unless a debit entry
had been made in the DFRC Licence for each items allowed to be imported.
9.5
The
normal validity period of DFRC Licence shall be 12 months.
9.6
DGFT
would not be issuing DFRC Licence in respect of SION which are subject to Actual User
Condition in the Hand Book of Procedure Vol.II.
The Customs duty exemption shall not be available to DFRC Licence issued for inputs
of such SION.
9.7
The
DFRC Licence and / or the items imported against it are freely transferable. After noting in computer system, Bill of
Entry along with DFRC(s) (registered with
computer system) shall be presented before concerned Appraising Officer in Group VII. The DFRC Nos and date with each item,
corresponding quantity and value of goods to be debited and duty are corresponding to
debit amount shall clearly be mentioned on all copies of Bill of Entry. DFRC wise value of goods will be debited
(below endorsement regarding DFRC and after debit, Left balance if any, shall also be
endorsed as Closing balance by the Appraising Officer putting his dated signature. There will also be debit sheet to be
attached to DFRC in which debit wise (in serial order) details of Bill of Entry Thoka No.
and date, IGM/item and date, importer’s name and address, description of goods
quantity, CIF value, CHA, duty rate of debit and amount debited will be certified by the
Appraising Officer. The number of
every fresh debit sheet attached (N/s-1, N/s II, N/S-111 etc) shall be indicated on the
reverse of the original DFRC.
9.8
After
assessment of Appraising Officer, the Bill of Entry will be audited by the concurrent
Audit Department of Customs House (Debits made in DFRC) shall also be audited by the Audit
Department and thereafter countersigned by the concerned Asstt. Commissioner of Group
–VII. After the Bill of Entry is
signed by Asstt. Commissioner, it will be
forwarded to comptist for calculation check and pin pointing for duty (and cess, if any)
to be paid in cash. Comptist
shall also check correctness of duty foregone from details on the debit sheet attached to
DFRC and total duty foregone stated on the Bill of Entry.
Thereafter, Bill of Entry will be forwarded to Computer Section where the details
of Bill of Entry will be entered in Bill of Entry Module and the details of DFRC debit
will be entered in ‘debit module’. The
debit module will be with reference to DFRC registration no. (and also original DFRC
holder’s) name and address, DFRC No, and date, authority of issuing DFRC and the
period of validity of the DFRC). After
the entry in the Bill of Entry module and debit module (for all relevant DFRCs), both the
bill of Entry and DFRC (s) will be endorsed with stamp entered in system (with dated
signature of person entering the details). Bill
of Entry will also be endorsed for total amount debited against DFRC(s).
9.9
After
computer entry, Bill of Entry will be sent back to Group –VII, where, after noting
the details of duty foregone, ADF number will be endorsed on Bill of Entry by the ADF
clerk.
9.10
In
addition to what is stated above, all other existing instructions for assessment and
examination of import goods shall apply mutatis mutandis.
Sd/-
(M.V.S.PRASAD)
COMMISSIONER OF
CUSTOMS
F.No.S.Misc.429/2000-Grp.
–7.
Group-7
– (DFRC)
Custom
House, Chennai –1.
Dated:
03.01.2001
//
Attested //
(VASA
SESHAGIRI RAO)
JOINT
COMMISSIONER OF CUSTOMS
