Remission of duty

CHATROOM

Rule 21 of the Central Excise Rules is applicable when goods are destroyed before removal.

We are a 100 per cent Export Oriented Unit (EOU). We dispatched our goods for exports without duty payment, but due to an accident on the way to the port, the goods were destroyed. We have sought remission of duty. However, the excise department insists on duty payment. This means heavy loss for us. Can you please advice?

Rule 21 of Central Excise Rules, 2002, deals with remission of duty in case the goods are lost or destroyed by natural causes or unavoidable accident or become unfit for consumption or marketing, but only in situations where the loss or destruction occurs anytime before removal of goods. In your case, the loss has occurred after removal. Therefore, the stand of the department denying remission is, in my opinion, quite valid. In this connection, you may refer to the case of Meghmani Industries Ltd [2007 (218) ELT 50 (Tri. Ahmd.).

We are merchant exporters. Our supporting manufacturer says that getting the triplicate copy of ARE1 attested by the Central Excise authorities is taking a long time and this delays our exports. Can you please suggest a way out?

You do not need the triplicate copy of ARE1 to effect exports. Please see Para 2 of CBEC Circular no. 284/118/96-CX dated 31.12.1996, which reads as follows : Para 5 of Board's Circular No. 87/87/94-CX, dated 26-12-1994 provides that exporters, are allowed to remove the goods for export on their own where they do not want examination to be done by the Central Excise Officers. It has been provided only for the sake of verification, that, in such cases they shall, within 24 hours of the removal of the consignment, deliver triplicate copy, quadruplicate copy, quantuplicate copy and sixtuplicate copy of AR4 to the Range Superintendent. Accordingly, it is clarified that the Customs Officers should not withhold such exports for want of triplicate copy from the Range Superintendent. It is, however, clarified that exporters should not clear such goods unless they execute necessary bond in terms of Rule 13 or Rule 14 as the case may be and they should also indicate the bond number and the authority before whom the bond is executed in the relevant column provided in Form AR4. Even when export containers are sealed by excise authorities, the triplicate of ARE1 need not be sent to the port. It is required to be sent by the jurisdictional authorities, after due verification of duty payment, in a tamper-proof seal-cover addressed to the rebate sanctioning authority or bond accepting authority. This is evident from Chapter 8, Part I of Manual of Supplementary Instructions, 2001.

Is there any specific instruction on how we should effect transfer of an import licence, like Duty Free Import Authorisation?

Foreign Trade Policy and Procedures are silent on the issue. I cannot recall any specific instructions on the procedures. The prevalent procedure is to issue a transfer letter, with signature of the transferor duly attested by his bankers.

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