In an earlier reply, you had mentioned that Status Holder Incentive Scrip (SHIS) can be utilised for regularising cases of default under advance authorization, as allowed under Para 3.17.11 of the Foreign Trade Policy (FTP). However, the Customs are not allowing the same, as they say that SHIS is valid for import of capital goods only. Can you please clarify the correct position?
When I gave that reply, Para 12.1 of Chapter 23 of CBEC Customs Manual 2012 said that Duty Credit Scrips may be used/debited towards payment of Customs Duties in case of export obligation defaults under Authorisations issued under Chapters 4 and 5 of the Foreign Trade Policy (FTP). Subsequently, the CBEC has uploaded its Customs Manual 2013, where a sentence has been added at the same paragraph, stating that the usage of duty credit scrip is in relation to such goods which are allowed to be imported under the respective schemes. This restriction, in my opinion, can be challenged on the grounds that the FTP contains no such stipulation, that the CBEC had no provocation to change its opinion and that the dispensations for import are quite different from special provisions at Para 3.17.11 of FTP. Until you challenge the Customs in the Court and win your case, the Customs field formations are bound to follow the CBEC instructions given in the latest Manual.
For Export Promotion Capital Goods (EPCG) application of stand-alone restaurants, is approval from the Department of Tourism needed?
Hotel and tourism services are covered under the Services Export Promotion Council. In my opinion, if you want to apply for an EPCG licence, you must have a Registration-cum-Membership Certificate issued by the said Council, even if you are only a stand-alone restaurant. In case you want to import any restricted item, the approval of the Exim Facilitation Committee (EFC) will be required. The EFC, in turn, will seek the recommendation of Director General, Tourism, Government of India, before granting approval.
We refer to RBI Circular No. 14 dated July 22, 2013, which reduces the time limit for realisation of export proceeds to nine months, and says that the time limits for exports from SEZ and exports through warehouses abroad remain unchanged. The circular is silent about the position for EOU/EHTP/STP/BTP/BTP units. For them, will the said period be 12 months or nine months, considering the Master Circular no.14/2013-14 dated 1-7-2013, which gives 12 months' time for EOU/EHTP/STP/BTP/BTP units?
My opinion is that the reduced period of nine months will not apply to exports by status holders or EOU/EHTP/STP/BTP/BTP units, and for them the period continues to be 12 months. However, it will help all concerned if RBI clarifies the position.
Are we required to pay service tax on labour charges to a contractor for loading/ unloading, etc., of cargo in the factory?
That service is not covered under the negative list or under any exemption. So, service tax has to be charged, unless the service provider claims exemption as a small service provider.
When I gave that reply, Para 12.1 of Chapter 23 of CBEC Customs Manual 2012 said that Duty Credit Scrips may be used/debited towards payment of Customs Duties in case of export obligation defaults under Authorisations issued under Chapters 4 and 5 of the Foreign Trade Policy (FTP). Subsequently, the CBEC has uploaded its Customs Manual 2013, where a sentence has been added at the same paragraph, stating that the usage of duty credit scrip is in relation to such goods which are allowed to be imported under the respective schemes. This restriction, in my opinion, can be challenged on the grounds that the FTP contains no such stipulation, that the CBEC had no provocation to change its opinion and that the dispensations for import are quite different from special provisions at Para 3.17.11 of FTP. Until you challenge the Customs in the Court and win your case, the Customs field formations are bound to follow the CBEC instructions given in the latest Manual.
For Export Promotion Capital Goods (EPCG) application of stand-alone restaurants, is approval from the Department of Tourism needed?
Hotel and tourism services are covered under the Services Export Promotion Council. In my opinion, if you want to apply for an EPCG licence, you must have a Registration-cum-Membership Certificate issued by the said Council, even if you are only a stand-alone restaurant. In case you want to import any restricted item, the approval of the Exim Facilitation Committee (EFC) will be required. The EFC, in turn, will seek the recommendation of Director General, Tourism, Government of India, before granting approval.
We refer to RBI Circular No. 14 dated July 22, 2013, which reduces the time limit for realisation of export proceeds to nine months, and says that the time limits for exports from SEZ and exports through warehouses abroad remain unchanged. The circular is silent about the position for EOU/EHTP/STP/BTP/BTP units. For them, will the said period be 12 months or nine months, considering the Master Circular no.14/2013-14 dated 1-7-2013, which gives 12 months' time for EOU/EHTP/STP/BTP/BTP units?
My opinion is that the reduced period of nine months will not apply to exports by status holders or EOU/EHTP/STP/BTP/BTP units, and for them the period continues to be 12 months. However, it will help all concerned if RBI clarifies the position.
Are we required to pay service tax on labour charges to a contractor for loading/ unloading, etc., of cargo in the factory?
That service is not covered under the negative list or under any exemption. So, service tax has to be charged, unless the service provider claims exemption as a small service provider.
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You can write to us at smechat@bsmail.in