Circular No. 46/96-Cus.
dated 30/8/96
F.No. B. 40/8/96-TRU
Government of India
Ministry of Finance, Department of Revenue
Tax Research Unit, New Delhi

Subject : Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996

 I am directed to say that the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 which shall come into effect on 1st September, 1996 have been modified slightly vide Notification No. 43/ 96-Customs (N.T.) dated 30th August, 1996.

2.    the modifications made are –

(a)    It has been provided that these rules shall apply only to such of the exemption notifications issued under section 25(1) of the Customs Act, which specifically provide for their applicability;

(b)  The importer – manufacturer shall be required to execute a bond without surety or security;

(c)  A provision for intimation to the jurisdictional Superintendent of Central Excise regarding the receipt of the imported goods in the factory of the importer- manufacturer has been made.

3.  consequently, notification No. 61/96-Customs and 62/96- Customs, both dated 30th August, 1996 have been issued amending the relevant notifications in respect of which it is intended that the benefit of exemption or concession in customs duty shall be subject to the observance of the procedure under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996. Both these notifications take effect from 1st September, 1996. For ready reference, a list of exemption where the said rules shall apply is enclosed as Annex I.

4. It may be noted that in the case of Alatheon and copper wire for the manufacture of Copper – T Contraceptives (S.No. 77 of Not. No. 36/96- Cus), the certificate from the Ministry of Health and Family Welfare has been dispensed with. In the the case of Not. Nos. 63/95-Cus and 64/95-Cus, the rules have been made applicable to goods imported under both list A and B.

5. For the sake of uniformity, standard from of registration certificate, etc. have been designed which may be followed by the Commissionerates. These standard forms are :

(a) registration certificate (Annex II);

(b) Manufacturer’s application and Assistant Commissioner of Central Excise’s countersignature (Annex III);

(c)  bond to be executed by manufacturer (Annex IV);

(d)  information of the receipt of imported goods (Annex V)

6. As far as the registration certificate (Annex II) is concerned, the original should be for the holder and duplicate for the Range Superintendent. The triplication may be the Assistant Commissioner of Central Excise’s office copy. The importer- manufacturer may request for the registration certificate by way of a simple letter, on his letter head, giving the necessary details which are to be incorporated in the registration certicate.

7.  It may be mentioned that the importer manufacturer would have to make an application (Annex III) every time he wishes to make the import. The application may be filled by the holder of the registration certificate in quadruplicate and submitted to the Range Superintendent who shall forward them after verification to the Assistant Commissioner of Central Excise. After the Assistant Commissioner of Central Excise endorses the necessary details thereon, the original should be sent to Assistant Commissioner of Customs, duplicate to range Superintendent,  triplicate may be retained by Assistant Commissioner of Central Excise as office copy and quadruplicate may be returned to registration certificate holder. The Assistant Commissioners of Central Excise and Superintendents of Central Excise may be instructed to deal with the applications submitted by the importer manufacturer expeditiously and to ensure that the necessary endorsements for availing the exemption are issued without any delay. They should be asked to deal with and dispose of the applications the same day it is received in their office.

8.The bond amount 9 Annex IV) should be for the differential duty (total customs duties but for the concession less the total duties in terms of the concession). A running bond account could be maintained in case the importer- manufacturer desires. In such cases, the bond amount can be arrived at for estimated imports over a period of an year.

9. The aforesaid rules provide for a simple account (bill of entry wise) to be maintained by the importer- manufacturer. The basic features of this account are mentioned in rule 7. No specific format of such account is being prescribed. The accounts may be checked quarterly and the Assistant Commissioner of Central excise should satisfy himself through this and other records that the imported goods have been appropriately used. In case of recovery of any duty of customs on account of mis-use of the concession or for any other reason, necessary action to recover the customs duty and to adjudicate the cases has to be taken by the Assistant Commissioner of Central Excise in his capacity as the Assistant Commissioner of Customs.

10. While the importer manufacturer has to inform the Range Superintendent of the receipt of the imported goods within 2 days of the receipt (excluding holidays), occasional failure to do so in exactly  2 days should alone not be a cause of issuing show cause notices to the manufacturer. Once the intimation has been received, the Central Excise officers may physically verify the receipt but only selectively. It may be borne in mind the in case there is a short receipt at the factory vis-a-vis the quantity assessed / cleared under the Bill of Entry, necessary action to recover the duty should invariably be taken.

11.  The officers at the port import, where clearance of the imported goods shall be made, shall also ensure that the relevant documents and particulars required to b forwarded by them under rule 5(2), have actually been received by the Assistant Commissioner of Central Excise concerned. There should not be any delay on this account.

12. The above changes may be given wide publicity through issue of public/ trade notices, at the Customs Houses and in the Central Excise Commissionerates, so that the trade and industry are informed of these changes in order that there is a smooth transition. Public/ trade notices may be issued immediately on receipt of these instructions.

13. In order that during first two weeks of the implementation of these rules there is no dislocation of import plans and manufacturing, Commissioners may ensure that the non-fulfilment of procedural aspects alone like non-submission of application in standard form (Annexure III) on part of the concerned importer manufacturers do not come in the way of the availment of the duty concessions.

14.  In case any procedural problems are faced by the Assistant Commissioner in implementing these rules, guidance may be given by the Commissioners. If necessary, a reference may be made to the Board for any clarification.

Sd/-
(Rajiv Talwar)
Under Secretary (TRU)

   Annex I
 Broad description of the exemption

Notification No. 36/96-Cus

1.    Petroleum oils, bitumen, asphalt, etc. for the manufacture of fertilisers. Ref: S.No. 32 of Notfn.

2.  Silver powder suspension, silicone resin and silicon rubber for the manufacturer of solar cells of solar cell modules. Ref: S.No. 66 of Notfn.

3. Alatheon and copper wire, for manufacture of copper – T Contraceptives. Ref: S.No. 77 of Notfn.

4.  Wood pulp for manufacture of newsprint. Ref: S.No. 80 of Notfn.

5. Glass fibre sewing thread and glass fibre filter cloth for manufacture of goods intended for pollution control purposes. Ref: S.No. 103 of Notfn.

6. Horological raw materials for manufacture of mechanical or quartz analog wrist watches. Ref: S.No. 122 of Notfn.

7.  Silicon for manufacture of undiffused silicon wafers, undiffused silicon wafers for manufacture of solar cells or solar cells modules, modules and photo voltaic systems for the manufacture of photo voltaic application.Ref: S.No. 152 of Notfn.

8.  Specified parts for manufacture of LCVs of pay load upto 4000 kg. S.No. 172 of Notfn.

9.  Raw materials for manufacture of telecom grade cables. Ref: S.No. 182 of Notfn.

10. Optical fiber for manufacture of telecom grade optical fibre cable. Ref: S.No. 183 of Notfn.

11. Parts for manufacture of hearing aids. S.No. 192 of Notfn.

12. Parts for manufacture of Braille watches. Ref: S.No. 198 of Notfn.

13.  Components for manufacture of wrist watches. Ref: S.No. 199 of Notfn.

14. components for manufacture of electronic modules of wrist watches. Ref: S.No. 200 of Notfn.

  Notification No. 63/95-cus

    15.    Raw materials, parts and components for manufacture of specified items of the electronic industry. (List A and B)

Notification No. 64/95-cus

    16.    Raw materials, parts and components for manufacture of specified items of the electron industry. (List A and B)

Annexure II
Registration Certificate under the Customs
(Import of Goods at Concessional Rate of Duty for
Manufacture of Excisable Goods) Rules, 1996
S.No…………of 19 ………..

F.No.
Division
Commissionerate

1. …………. of …………….. having undertaken to observe all the provisions of the Customs Act, 1962 (52 of 1962) and rules and regulations made thereunder, the Central Excise and Salt Act, 1944 (1 of 1944) and rules and regulations made thereunder and relevant notifications issued under section 25(1) of the Customs Act, is hereby certified to have been registered with the Central Excise and Customs Department for the purpose of the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996.

2. This certificate is valid only for the premises and the purposes specified in the Schedule below; it is not transferable and it shall remain valid till the holder carries on the activity for the purpose of which this certificate has been issued or till the holder surrenders this certificate, whichever is earlier.

Schedule

1. Name and address of the importer manufacture to whom the registration certificate is granted.

2. Nature and description of the imported goods normally used in the manufacture of excisable goods.

3.  Nature and description of the excisable goods manufactured from the imported goods.

<tdclass=”wtd30p”> Place

Signature of Assistant Commissioner with
Date date, name, stamp and seal
Copy to; Range Superintendent
Place Signature of Assistant Commissioner with
Date date, name, stamp and seal

Annex III
Application under the Customs (Import of Goods at Concessional Rate of
Duty for manufacture of Excisable Goods) Rules, 1996

(To be filled by the holder of the registration certificate. Original with 3 copies to be submitted through the Range Superintendent)

To

   Assistant Commissioner of Central Excise ………………

 We M/s …………………… (name and address of the factory) ………………. are registered under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 vide registration certificate S.No…………. of 19 ………… dated ………….. issued under F.No………..

 Vides No. …………. of notification No……….. Customs, dated the ……….. issued under section 25(1) of the Customs Act, 1992 read with the relevant provisions of the Customs Act, 1962 the Customs Tariff Act, 1975 (51 of 1975) and other laws for the time being in force the goods namely ………….. imported for the manufacture of ………………. attract the following Customs duty (ies) (specify rates)

  Basic duty            Special duty            Additional duty (ies)            Other Customs Duty (ies)

We undertake of follow the customs (Import of goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 as required by the above notification. The estimated quantity and value of such imported goods we wish to obtain for the manufacture of the aforesaid goods is………. (Specified quantity and value) and we intend to import them at …………. (specify port of Import) for uses at our factory premises at ……………………..

 The estimated duty leviable on the imported goods but for the exemption under the above notification is Rs…………. only (attach calculation sheet).

 The estimated total duty on the imported goods payable by us at the time of importation under the above notifications in Rs…………. only (attach calculation sheet).

        We also hereby undertake

 (a)  to use the said imported ………….. (specify imported goods) for the manufacture of ……….. (specify excisable goods) and to follow any other condition that the said notification imposes on us; and

(b)  to pay no demand, in the event of failure to comply with (a) above, an amount equal to the difference between the duty leviable on such quantity of the imported goods but for the exemption under the aforesaid notification and the paid by us at time of importation.

  We have also executed the necessary bond dated ………….. (enclose the bond executed) for your acceptance. It is requested that the application may kindly be forwarded, duly endorsed, to the Assistant Commissioner of Customs, Group ……….. (specify the appraising group and port of import).

Date Sing and stamp of authorised
Place    signatory, with name and
      address of the factory

 (Endorsement and countersignature of the ACCE on the application).

  It is hereby certified that M/s ………. having their factory at …………… are registered in this office under the Customs (Import of goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 vide S.No. ………….of 19………… dated …………..in F.No………….. They have executed the bond as required by the said rules for Rs……….. only, which has been accepted on behalf of the President of India by the undersigned and entered at S.No…………. dated …………. of bond registered.

F.No. Signature  of Assistant Commissioner
Place     with date name, stamp and seal
Date

To

        The Assistant Commissioner of Customs,

        Group …………………………………………………….. (Specify appraising group and port of import )


Annex – IV
Bond under the Customs
(Import of Goods at Concessional Rate of duty for manufacture of
Excisable goods) Rules, 1996
(delete words wherever not applicable)

 I / We …………… of  …………… (hereinafter called “the obligator(s)” am/ are held and firmly bound to the President of India (hereinafter called the “President)” in the sum of Rs……….. only to be paid to the President for which payment will and truly to be made, I/We jointly and severally bind myself/ ourselves and my/ our respective heirs executors, administrators, legal representatives/ successors and assigns by these presents.

 Dated this …………… day of  …………….

 Whereas the above bounden obliger having been permitted by the Assistant Commissioner of Central Excise at…………. (hereinafter called “the Assistant Commissioner”) to obtain a quantity of …. ………………. (specify quantity and units) of ………… (specify imported goods) for use in has factory at ……… for use in the manufacture of ………. specify excisable commodity (ies)], and in the manner specified in his application dated ……….. in terms of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No………….. Customs dated ……… (hereinafter referred to as “the notification”).

 The condition of this bond is that if the obliger and his representative shall observe all the provisions of the notification and the Customs (Import of goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules 1996 and relevant provisions of the Customs Act, 1962,(52 of 1962) the Central Excises and Salt Act, 1944 (1 to 1944) and Central Excise Rules, 1944 in respect of the aforesaid permission granted by the ACCE;

And if all, dues (lawful charges) which shall be demandable on the imported goods obtained by the obliger be duly paid into the treasury to the account of the Assistant Commissioner within ten days of the date of demand thereof being made in writing;

 This obligation shall be void, otherwise and on breach or failure in the performance of any part of this condition, the same shall be in full force and virtue;

And the President shall, at his option be competent to make goods all the loss and damages by endorsing his rights under the above written bond;

 I/We further declare that this bond is given under the orders of the Central Government in the performance of an act in which the public are interested;

 In these presents the words imposing singular only shall also include the plural and vice versa if the context so requires;

In witness thereof these presents have been signed the day herein before written by the obligor (s).

Place
Signature and name of obligor
Date

1.
Witness
Address
Occupation
2.
Witness
Address
Occupation

    Accepted for and on behalf of the President of India

Signature and date
Name ……………………
Designation with seal …………………


Annex V
Information regarding receipt of imported goods under the Customs
(Import of Goods at Concessional Rate of Duty for
Manufacture of Excisable Goods) Rules, 1996

To

        The Superintendent of Central Excise

Range …………..

Sir,

        I / We declare that the under mentioned consignment of imported goods cleared from …….. (specify port) Under S.No. ………………. Customs dated the  …………… has been received by us at our factory premises located at ………… on …………. day of ………………… at ………………. hrs.

        This consignment is in pursuance of the Assistant Commissioner of Central Excise endorsement and countersignature vide File No. ………… date …………… (copy attached) made on our application dated ………….

Name and address and reg. No. of importer manufacturer Particulars of Bill of Entry (Copy of B / E to be attached) Description and variety of imported goods. Quantity shown in
Bill of Entry 
Shortage detected on receipt, if any

I / We declare that the imported goods received as above are identifiable with the description given in the Bill of Entry to my/ our entire satisfaction and that I / we have entered the particulars of the imported goods so received in my / our relevant stock register.

Place
Signature of manufacturer – Importer
Date
Name with stamp …………………
Time of sending intimation :
Address of the factory ………….

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