Policy Circular No. 17 (RE-2005)/2004-09, dated 15th July 2005, clarifies the requirements for the Duty Free Credit Entitlement (DFCE) under the EXIM Policy for Status Holders (2003-04). The circular addresses concerns raised by trade and industry regarding the certification of export figures, particularly concerning the clause about the growth rate of suppliers. The clause in question mandates that the supplies made or export performance effected by a non-status holder to a status holder should have a 25% incremental growth over the previous year’s export turnover to qualify for DFCE benefits. The circular clarifies that, for certification purposes, Chartered Accountants (CAs), Company Secretaries (CS), or Cost Accountants (ICWA) may accept a supplier’s declaration confirming the 25% growth, rather than requiring direct verification from the supplier. This clarification aims to ease the certification process for trade and industry.
GOVERNMENT OF INDIA
MINISTRY OF COMMERCE & INDUSTRY
DEPARTMENT OF COMMERCE
DIRECTORATE GENERAL OF FOREIGN TRADE
Policy Division
Policy Circular No. 17 (RE-2005)/2004-2009
Dated: 15 July 2005
Subject: DFCE for Status Holders (2003-04) under EXIM Policy, clarification regarding.
Attention is invited to the Public Notice No 15(RE2005)/2004-09 dated 04.06.2005 relating to the DFCE for status holders (2003-04) under EXIM Policy under Foreign Trade Policy (2004-05).
2. In the CA certificate, as prescribed in Appendix 17 D announced on 04.06.2005, at Sr. No. (vii) a list of ineligible exports is given. In Sr. No. 11 therein, the clause relating to growth rate of supplier is mentioned. Representations were received from Trade & Industry regarding practical difficulties in certification of export figures by the CA/CS/ICWA relating to this clause. The clause is reproduced hereunder:
“Supplies made or export performance effected by a non-status holder (Merchant exporter/ Manufacturer with any export performance in 2003-04) to a status holder if the applicant as well as the non status holder have less than 25 per cent incremental growth over their respective previous years direct export turnover.”
3. It is necessary that the supplies made or export performance effected by non-status holder to status holder, the non-status holder has to achieve at least 25 per cent incremental growth over their respective previous years direct export turnover so as to make such supplies eligible for the benefits under the scheme. In light of this, it has been decided that to certify the export figures at Sr. No. 11 of the CA certificate, CA/CS/ICWA may rely on the declaration given by such suppliers (for their supplies made or export performance effected), that they have achieved at least 25% per cent incremental growth over their respective previous years direct export turnover.
This issues with the approval of DGFT
Sd/-
A K Singh
Joint DGFT
To
Trade and Industry
All Licensing Authorities
(F. No: 01/94/180/PolForm/AM05/ PC-IV)
