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Introduction: The Government of India, under the Ministry of Finance, Department of Revenue, has introduced an Amnesty Scheme for the one-time settlement of default in export obligation by Advance License and EPCG authorization holders. This initiative aims to provide a pathway for regularization and resolution for pending cases of default.

Detailed Analysis:

1. Amendment Notification (No.32/2023-Customs): The Ministry issued Notification No.32/2023-Customs on 26.04.2023, amending 13 customs notifications related to Advance Authorization and EPCG Schemes. The objective is to implement DGFT’s Public Notice No. 02/2023 dated 01.04.2023, allowing regularization of bona fide defaults.

2. Procedure for Regularization: Authorization holders can regularize pending cases by paying applicable customs duty corresponding to the export obligation shortfall. Interest is capped at a maximum of 100% of duties exempted, with no interest on Additional Customs Duty and Special Additional Customs Duty. The process must be completed by 31.03.2024, as per DGFT’s Public Notice No. 20/2023.

3. Interest Payment in Default Cases: The amendments specify that when duty on goods is paid to regularize export obligation defaults, interest is payable as specified in Public Notice No.02/2023 dated 01.04.2023 by DGFT. No additional changes are involved in this process.

4. Exclusions and Limitations: The scheme excludes cases under investigation or adjudication for fraud, mis-declaration, or unauthorized diversion of material and/or capital goods. Authorization holders cannot claim CENVAT Credit or Refund on duties paid under this scheme. Cases involving calculation mistakes will be considered on merit.

5. Mandatory Duty Payments: Authorization holders opting for the Amnesty scheme must make mandatory duty payments, including applicable interest, and submit the TR6 Challan, Bill of Entries, and Deficiency Letter (if any) from DGFT, adhering to the timelines mentioned in Public Notice 02/2023.

Amnesty Scheme for Export Obligation Default Settlement

6. Consequences of Non-Adherence: Failure to adhere to the conditions of the Amnesty scheme renders authorization holders ineligible, and actions will be initiated as per the conditions of the license and relevant customs notifications.

Conclusion: The Amnesty Scheme by the Government of India provides a crucial opportunity for Advance License and EPCG authorization holders to settle default cases. While offering a pathway to regularization, it comes with specific conditions and deadlines that participants must strictly adhere to. All concerned parties are urged to take note of this initiative, and any difficulties in implementation can be communicated to the authorities for resolution. The scheme’s success depends on the active cooperation of stakeholders and adherence to the stipulated procedures.

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Government of India
Ministry of Finance
Department of Revenue

Telephone : 22560406
Fax: 2261445
Email: pcommr7acc-cuschn@gov.in

OFFICE OF THE PRINCIPAL COMMISSIONER CUSTOMS (AIR CARGO)
NEW CUSTOM HOUSE, CHENNAI-VII COMMISSINERATE
AIR CARGO COMPLEX, MEENAMBAKKAM, CHENNAI 600 016

File No. CUS/EPCG/MISC/107/2024-EODC

Public Notice No. 04/2024-JNCH | Dated: 05.03.2024

Sub: Amnesty Scheme for one time settlement of default in export obligation by Advance License and EPCG authorization holders as per Public Notice No.02/2023 dated 01.04.2023, as amended, from time to time-Reg.

Ref: Notification No.32/2023-Customs dated 26.04.2023, read with Board’s Circular No. 11/2023-Customs dated 17.05.2023 issued vide F.No-605/06/2023-DBK

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1. The Ministry has issued Notification No.32/2023-Customs dated 26.04.2023 to amend 13 customs notification pertaining to Advance Authorization (AA) and Export Promotion Capital Goods (EPCG) Schemes. This is to implement Public Notice No. 02/2023 dated 01.04.2023 notified by DGFT that has provided a procedure, under category of regularization of bona fide defaults, in which all pending cases of the default in meeting export obligation (EO) may be regularized by the authorization holders on payment of applicable customs duty corresponding to the shortfall of EO. Interest payable is capped at maximum of 100% of such duties exempted on which interest is payable as specified in the said Public Notice dated the 01.04.2023. However, no interest is payable on the portion of Additional Customs Duty and Special Additional Customs Duty. The authorization holder choosing to avail this procedure must complete the process of payment on or before 31.03.2024 as per Public Notice No. 20/2023 dated 30.06.2023 issued by DGFT.

2. The amendments made by the Notification No.32/2023-Customs dated 26.04.2023 provide that in a case of default in export obligation, when the duty on the goods is paid to regularize the default in term of Public Notice No.02/2023 dated 01.04.2023 notified by DGFT, the amount of interest to be paid by the importer shall be payable as specified in the said Public Notice dated 01.04.2023. No other change is involved.

3. It may be noted that the cases under any investigation or adjudicated for involving fraud, mis-declaration or un-authorized diversion of material and /or capital goods are not covered in the scheme. Authorization holder shall not claim CENVAT Credit or Refund, under any provision of law, of any amount on duties paid under this scheme. However, there may be cases of calculation mistakes which are to be dealt on merits. Also, the DGFT Public Notice No.02/2023 dated 01.04.2023 specifies the necessary procedures which would be required to be followed.

In this regard, Authorization holders who have opted for Amnesty scheme are directed to make the mandatory duty payments along with applicable interest and submit the TR6 Challan, copy of all Bill of Entries pertaining to above mentioned Licenses and Deficiency Letter (if any) from DGFT as per the timelines mentioned in the Public Notice No.02/2023 dated 01.04.2023 as amended from time to time.

If the Authorization holders fail to adhere to the conditions of the said Amnesty scheme, they will not be eligible under the same and action will be initiated as per the conditions of license mentioned above, bond executed u/s 143 of Customs Act, 1962 read with relevant customs notification.

4. All Trade/Customs broker associations are requested to take note and publicize the contents of this Public Notice among their member/constituents.

5. This Public Notice should be considered as Standing Order for the purpose of Officers/Staff of Chennai VII (Air Cargo) Commissionerate, Chennai.

6. Difficulties, if any faced by the Trade/Importers/Customs Brokers in implementation of the above may be brought to notice of the undersigned through email:

eodcacc@gmail.com or pcommr7acc-cuschn@gov.in

Manayathara Mathew Jolly 
Date: 05-03-2024 11:23:51
(M Mathew Jolly)
Principal Commissioner of Customs, Chennai-VII

To
All concerned.

Copy to:

1. The Chief Commissioner of Customs, Chennai Zone for kind information.

2. All the Pr. Commissioners/Commissioners of Customs, Chennai Zone.

3. All the ADC/JC/Dy/Assistant Commissioners of Customs, Chennai-VII

4. All RA of DGFT Chennai, Coimbatore, Madurai, Kochi, Vizag.

5. Deputy Commissioner (EDI) for uploading on Chennai Customs website & Air Cargo website (Chennai-VII).

6. CHS- for displaying Notice Board.

7. Master file.

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