Chatroom: Customs should not hold up exports due to valuation issues

We are an EOU. We cleared the goods manufactured by us into DTA after reversing the BCD and SWS. Now, the DTA party has rejected the goods. How can we square the transactions and get back the BCD and SWS paid to the government? Under what documents should the DTA party return the goods?
 

Firstly, you can give a credit note to the DTA party and square the transaction. Next, the DTA party can send back the rejected goods under a delivery challan. Third, you can receive the goods and treat the inputs on the goods as duty paid, so that when you reprocess or repair the rejected goods and supply again to the same or another party in DTA, you need not pay any BCD or SWS. Of course, if you export the repaired or reprocessed goods, you can claim drawback of the BCD and SWS paid on the inputs through brand rate.
 

We got our advance authorisation invalidated for direct imports and got an invalidation letter issued in favour of the intermediate supplier. For some reason, that supplier has defaulted and we have not received the goods from him. We don’t know whether an advance authorisation for intermediate supplies against the invalidation letter was issued and if so, whether it was utilised and if so, to what extent. Now, is there any provision whereby we can get the credit back in the advance authorisation so that we can use that amount to make direct imports?
 

I don’t find any provision for such an eventuality. I suggest you approach the policy relaxation committee at the DGFT HQ. You can plead that even if an advance authorisation has been issued against the invalidation letter and it has been utilised, the failure to supply you the intermediates can result in recovery of the duty on the inputs imported by the intermediate supplier and so, giving the re-credit in your advance authorisation need not result in any loss for the government. You may also offer to give any affidavit regarding non-receipt of intermediates from the supplier and indemnity the government against any losses.   Of course, your advance authorisation should be valid for re-credit.
 

We do not have an IEC. We want to export samples to a foreign party who is interested in our goods. If he approves the samples, he will place the order. We know that to export or import, we need an IEC. Do we need an IEC even for sending samples?
 

Para 2.07 of HBP gives the list of categories exempted from IEC number. Export of samples is not covered there.
 

The Customs have held up our export consignment because our export price is nearly twice the price our purchase price. How to convince the Customs to allow export of the goods and investigate later?
 

You can refer the Customs to CBEC Circular no.37/2007-Cus dated 9th October 2007. It says that export consignments should not be held up for valuation enquiries/investigations.

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