Circular No. 87/87/94-CX
dated 26/12/94

F. No. 209/18/93-CX.6 (Pt.)
Government of India
Ministry of Revenue
Department of Revenue
Central Board of Excise & Customs, New Delhi

Subject: Exports without payment of Central Excise Duty in bond under Rule 13(1)(a)- Procedure regarding.

1.1  Attention of Collectors is invited to Board”s telex F.No. 209/18/93 dt. 26.09.94 & 27.09.94 communicating the issue of fresh rules and notification relating to exports.

1.2 The new Central Excise Rule 13(1) (a) has been framed to permit exports of excisable products without payment of Central excise Duty. The Rule 13(1) corresponds to the earlier Rule 13(1) of the Central Excise Rules. The fresh Notification No. 48/94-dt. 22nd Sept. 1994 [read with Corrigendum dt. 6th and 26th Oct, 1994] has been issued under the new Rule 13(1)(a) which permits export of all excisable goods outside India Nepal and Bhutan, without payment of Central Excise Duty. 

2. the salient features of the new Rules and Notification issued thereunder are briefly summarized below:-

2.1  Self Removal Procedure

Now the exporters are being allowed to take clearances for export without the presence and examination of export goods by the Central Excise Officer. However this facility shall not be available to export of excisable commodities under physical control.

2.2  AR4 and AR4A are merged

The existing AR4 and AR4A forms have been merged. Now only one single type of AR4 is required to be filed by exporters in all the situations namely:-

–  Export Clearances on their own without examination by the Central Excise Officer whether under claim for rebate or under bond.

–  Export Clearances under Central excise seal whether under claim for rebate or under bond.

2.3 Option of executing bond either with Maritime Collector or Jurisdictional  Assistant Collector of Central Excise

(a) The number of Maritime Collectors has been presently reduced to seven

(b) Even where the export is from any of the port, airport or post office falling within the jurisdiction of Maritime Collector of Central Excise, the option is available to execute the bond before such Maritime Collector of Central Excise or the Jurisdictional Assistant Collector of Central Excise. Accordingly exporters are required to clearly indicate on the AR4 the complete postal address of the authority before whom the bond is executed and to whom the documents are to be submitted/ transmitted for admission of proof of export;

(c) Where the export is made from a Port/ Airport/ Post Office, other than the Port/ Airport / Post Office falling within the jurisdiction of the Maritime Collector of Central Excise specified in the Rule/ Notification, the exporter shall be required to execute the bond for export without payment of duty before the jurisdictional Assistant Collector of Central Excise.

3. The following consolidated instructions are issued with regard to export under bond without payment of Central Excise Duty on excisable goods exported to countries other than Nepal and Bhutan [For exports to Nepal and Bhutan separate instructions are being issued]. The earlier instructions, on the subject which are inconsistent with these instructions, the new rules and the notifications issued thereunder may be treated as withdrawn.

BOND

4.0  The first step that is required to be taken for clearance of excisable goods, without payment of Excise Duty for export from the factory or the warehouse or any other premises as approved is the execution of the bond for due despatch of goods. The bond can be executed either by the manufacturer or the merchant exporter. Where the export is from any of the port, airport or post office falling within the jurisdiction of Maritime Collector of Central Excise, option is available to execute the bond before Assistant Collector of Central Excise having jurisdiction over the factory of manufacture of excisable goods. For this purpose exporters are required to clearly indicate on the AR4 complete postal address of the authority before whom bond is executed.

4.1  Types of Bonds:    There are six types of bonds available for purpose of due despatch of goods or exports. These are

–  B 1 (Surety)

–  B 1 (Security)

–  B 1 (General Surety)

–  B 1 (General Security)

–  B 16 (General Surety)

–  B 16 (General Security)

Exporters have option to execute general bond (B 1 general) or bond (B 1) to cover particular consignment. In case of particular B-1 bond, amount of bond should be equal at least to the duty chargeable on the goods to be exported. In case of general B-1 bond amount of the bond would be equal to the full duty on the exporters estimate of the maximum quantity of the excisable goods likely to be in transit during the period between clearance from the factory and acceptance of proof of export. In case of B-1 general bond a running bond account in proforma of Annexure-I shall be maintained by the authority before whom the bond is executed. The manufacturer exporters who have executed B-16 bond are not required to execute separate bond to cover duty on goods exported without payment of Duty.

4.2  Special facility to Certain categories of exporters:    Following categories of exporters need not furnish any Bank Guarantee or Cash Guarantee or Cash Security for the export bond. Bond with Surety would suffice in these cases.

–  Super Star Trading Houses

–  Star Trading Houses

–  Trading Houses

–  Export Houses

–  Registered Exporters (registered with relevant Export Promotion Council)

4.3  Extent of Security or Bank Guarantee:    Other manufacturer exporters may execute B-1/ B-16 bond with 10% security/ bank guarantee. Merchant exporters [other than those falling under para 4.2 above] shall execute B-1 bond with 25% security/ bank guarantee.

4.4  Bond to be executed by Manufacturer Exporters

4.4.1  Manufacturers who are exporting on their own account (Manufacturer Exporters) who manufacture dutiable excisable goods and desiring to export without payment of Excise Duty (under bond) can execute either a particular B-1 bond [to cover the particular consignment] or a consolidated B-1 general bond [to cover a series of export from his factory], or B-16 (General Security or General Surety) with the jurisdictional Assistant Collector of Central Excise.

4.4.2 the export is from any of the port, airport or post office falling within the jurisdiction of Maritime Collector of Central Excise, the option is available to the Manufacturer Exporter to execute the particular bond or the consolidated bond before such Maritime Collector of Central Excise. In case where B-1 bond is executed for a specific consignment before the Maritime Collector of Central Excise, the Manufacturer Exporter should obtain an attested photo copy of the Bond executed before the Maritime Collector of Central Excise and produce the same at the time of presentation of AR4 to the Superintendent of Central Excise. Where a Consolidated B-1 general bond is executed before the Maritime Collector of Central Excise, the Manufacturer Exporter shall inform him of intention to export the goods and obtain a Certificate of provisional debit in the Running Bond Account (maintained in proforma at Annexure 1) by him. This certificate will have to be produced by the manufacturer exporter before Superintendent of Central Excise at the time of presentation of AR4 for signature.

4.4.3  Export by Merchant Exporters under Bond Eecuted by manufacturers

Merchant exporters are also permitted to export excisable goods under Bonds executed by manufacturers. In such circumstances, for purposes of complying with Central Excise Law and Procedures the manufacturer who has executed the Bond would be responsible for discharging all the liabilities under the said provisions. In such circumstances, the application in Form AR4 will be in the name of the manufacturer who executes the Bond. All other procedures for admission of the proof of export would be the same as in the case of manufacturer exporters. It should be brought to the notice of manufacturers that once they permit the Bond executed by them for exports by merchant exporters, it would be the manufacturer”s responsibility for accountal of the export goods.

4.5  Bonds to be executed by Merchant Exporters

4.5.1  With jurisdictional Assistant Collector:  Where a merchant exporter desires to export excisable goods manufactured in a factory or number of factories, he can execute a B-1 bond to cover a particular consignment or a consolidated B-1 general bond, to cover series of export consignments from the same factory, before the Assistant Collector of Central Excise having jurisdiction over the factory.

With the Maritime Collector of Central Excise

4.5.2  Where the export is from one of the port, airport or post office falling within the jurisdiction of Maritime Collector of Central Excise, the option is available to the Merchant Exporter to execute the particular bond or the consolidated bond before concerned Maritime Collector of Central Excise. In case of a particular B-1 bond, the Merchant Exporter should obtain an attested photo copy of the Bond executed before the Maritime Collector of Central Excise and produce the same at the time of presentation of AR4 to the Superintendent of Central Excise. Where a Consolidated B-1 general bond is executed, the Manufacturer Exporter shall inform the Maritime Collector of his intention to export the goods and obtain a Certificate of provisional debit in the Running Bond Account (in proforma of Annexure 1) maintained by him. This certificate will have to be produced by the Merchant Exporter before Superintendent of Central Excise at the time of presentation of AR4 for signature. In above situations the exports are expected to go through the port of the Maritime Collector of Central Excise before whom the bond is executed.

4.5.3  Where the Merchant Exporter has executed the consolidated B-1 general bond with the Maritime Collector of Port “X” but the export are to be made through the port “Y” or “Z” falling under jurisdiction of other Maritime Collector of port “X” and obtain a block transfer of the Credit in the Running Bond Account maintained by the Maritime Collector of port “X” against the B-1 general bond. The block transfer shall be made in favour of the Maritime Collector of Central Excise of port “Y” or “Z”. The Maritime Collector of Central Excise of port “X” shall also intimate the fact of block transfer to both the Maritime Collector of Central Excise of port “Y” or “Z”. The Maritime Collector of Central Excise of Port “X” shall also intimate the fact of block transfer to both the Maritime Collector of Central Excise of port “Y” or “Z” and the Superintendent of Central Excise having the jurisdiction over the factory/ warehouse. On receipt of intimation of Block Transfer, the Maritime Collector of Central excise of port “Y” or “Z” shall treat the same as Bond executed before him and shall be responsible for monitoring the proof of export. However where it becomes necessary to recover duties, the action for recovery will have to be taken by the Maritime Collector of Central Excise of port “X”.

4.5.4. Where the Merchant Exporter has executed the consolidated B-1 general bond with the Maritime collector of port “X” but the exports are to be made through the port “A” or “B” not falling under jurisdiction of any of the Maritime Collector of Central Excise, the Merchant Exporter shall approach Maritime Collector of Port “X” and obtain a block transfer of the Credit in the Running Bond Account maintained by him against the B-1 general bond. The block transfer shall be made in favour of the Assistant Collector of Central Excise having jurisdiction over the factory/ warehouse and suitable intimation sent to him by the Maritime Collector of Central Excise of port “X”. On receipt of intimation of Block Transfer, the Assistant Collector of Central Excise having jurisdiction over the factory shall treat the same as Bond executed before him and shall be responsible for monitoring the proof of export. However where it becomes necessary to recover duties, the action for recovery will have to bee taken by the Maritime Collector of Central Excise before whom the bond is executed.

4.5.5  Where bond is executed by the merchant exporter, it shall be necessary that the AR4 is signed by both the merchant exporter and the manufacturer.

4.6  Running Bond Account

Every Central Excise Authority before whom a consolidated B-1 general bond has been executed shall maintain a running bond account in the proforma of Annexure 1. Whenever any block transfer are made in favour to other Central Excise authority, debit shall be made in the account. Suitable debit shall also be made wherever exports are allowed against the bond. On acceptance of the proof of export the bond account shall be credited  to the extent the debit was made while permitting the exports. The running bond account shall also be credited after the Block Transfer is returned by the other authority. However where it becomes necessary to taken action for recovery of duties, such action shall be taken by the authority before whom the bond is executed in consultation with the Assistant Collector of Central Excise having  jurisdiction of the factory and / or the other Maritime Collector of Central Excise.

5.0 The removal of goods without payment of Central Excise Duty from a factory or warehouse without examination by the Central Excise Officers.

5.1.1 The exporters are now allowed to remove the goods for export on their own without getting the bonds examined by the Central Excise officers in respect of all commodities other than those covered under physical control. The AR4 in such cases would be prepared in sixtuplicate, giving all particulars and declarations. The exporter shall deliver triplicate, quadruplicate, quintuplicate and sixtuplicate copies of AR4, to the Superintendent of Central Excise having jurisdiction over the factory or the warehouse, within twenty four hours of the removal of the consignment and would retain the original and duplicate copies for presenting alongwith the consignment to the Customs Officer at the point of export. However the exporters may ensure before clearances that the necessary bond as as detailed in para 4 has been executed for this purpose.

5.1.2. Exporters, whether manufacturer exporter or merchant exporter may be cautioned that unless they execute the necessary bond before the Competent Authority they should not clear the goods under the relaxed procedure. They should without fail indicate the Bond Number and the authority before whom the relevant bond is executed in the relevant columns provided in Form AR4. Exporters should be suitable advised in the Trade Notice that if it is found that the goods are being removed without execution of bond for export or the particulars of bond furnished in the AR4 in not correct and proper, the exporters will be liable for penal action as if the goods have removed without authority of law.

5.2  The jurisdictional Superintendent of Central Excise shall examine the information contained in AR4 and verify the fact of execution of bond (as per para 4 above) and other certificates/ declarations made by the exporter. After he is satisfied that the information contained in the AR4 is true, he will sign at appropriate places in the four copies of AR4 submitted to him and put his stamp with his name and designation below his signature. He would then dispose of the triplicate, quadruplicate, quintuplicate and sixtuplicate copies of AR4 as under:-

i)  Triplicate

To the authority before whom the bond is executed and who will accept the proof of export i.e. Maritime Collector of Central excise or the Assistant Collector of Central Excise declared by the exporter on the AR4. This copy on the request of exporter may be sealed and handed over to the exporter/ his authorized agent for presenting to the authority.

ii) Quadruplicate

To the Chief Account Officer in the Collectorate Headquarters.

iii)  Quintuplicate

Office copy to be retained by the Central Excise Officer.

iv)  Sixtuplicate

To be to given the exporter or his authorized agent is sealed cover.

Procedure for exports under Central Excise Seal:

6.1  Where the exporter desires the sealing of the goods by the Central Excise officers so that the export goods may not be examined by the Customs Officers at the Port/ Airport of shipment, he should present an AR4 application in sixtuplicate to the Superintendent of Central excise having jurisdiction over the factory/ warehouse at least twenty four before the intended removal of the export goods from the factory/ warehouse. However, where exporter is unable to give 24 hours advance notice to the Superintendent of Central Excise, his request for shorter notice should normally be accepted. All such relaxations shall be reported to the Assistant Collector of Central Excise for ex-post facto approval. Collector of Central Excise may delegate powers under rule 187 to the Assistant Collector of Central Excise.

6.2 The Superintendent of Central Excise may depute an Inspector of Central Excise or may himself go for sealing and examination of the export consignment. Where the AR4 indicates that the export is in discharge or an export obligation under a Quantity- based Advance License or a Value-based License issued under the Duty Exemption Scheme, in such case the consignment should invariable be examined and sealed by the Superintendent of Central Excise himself.

6.3 The Central Excise Officer examining the consignment would draw samples wherever necessary in triplicate. He would hand over two sets of samples, duly sealed, to the exporter or his authorized agent, for delivering to the Customs Officer at the point of export. He would retain the third set for his records. The instructions and procedure for drawl of samples prescribed by the Collector or the Board should be followed.

6.4  The export consignment should be carefully examined vis a vis the description of goods, their value and other particulars/ declarations on the AR4. The Central Excise Officer shall verify the facts, certificates/ declaration made by the exporter. The value declared on AR4 should be as per Section 4 of Central Excise and Salt Act, 1944. After Central Excise Officer is satisfied that the information contained in the AR4 is true and after verifying that necessary bond (as detailed in para 4 above) has been executed by the exporter, he would allow the clearances and also sign all the six copies of the AR4 at appropriate places and put his stamp with his name and designation below his signature.

The copies of AR4 would be disposed of as under:

To the exporter for presenting to Customs Officer at the point of export along with the export consignment
Triplicate: To the authority competent to accept the proof of exports i.e. Maritime Collector of Central excise or the jurisdictional Assistant Collector of Central Excise, as declared by the exporter on the AR4. The Central Excise Officer may hand over this copy under a sealed cover on exporter”s request.
Quadruplicate: To the Chief Account Officer at his Collectorate Head Quarters
Quintuplicate: To be retained for records
Sixtuplicate: To be given to the exporter or his authorized agent, in a sealed cover, for handing over to Customs Officer.

Markings

7.1  The packages in which the goods are to be exported would be legibly marked in ink or oil color or in such other durable manner with progressive number commencing with no.1 for each calendar year and with the exporter”s name. Under proviso to rule 185(1) or Central Excise Rules, 1944, Collectors are empowered to relax this requirement [Places see Para 15.5].

8.1 The different copies of AR4 forms should be of different colors indicated below:-

(i) Original – White

(ii) Duplicate – Buff

(iii) Triplicate – Pink

(iv) Quadruplicate – Green

(v) Quintuplicate-Blue

(vi) Sixtuplicate – Yellow

It will be sufficient if the copies of AR4 contain a color based on the tip or right hand corner in accordance with above color scheme.

8.2  Exporters should be advised to take adequate care in filling up the AR4 proforma. The authority before whom the bond is executed or in whose favour BLOCK TRANSFER is obtained [who is also the authority for accepting the proof of export] should be clearly indicated on the AR4 along with its complete postal address at appropriate place in the AR4. The applicable portions should be clearly retained and inapplicable portion struck off. The exporters are now required to give following certificates/ declaration.

“We hereby certify that the above mentioned goods have been manufactured

(a)  availing facility/ without availing facility of Modvat credit under rule 57A of Central Excise Rules, 1944

(b)  availing facility/ without availing facility under Rule 12(1)(b) of Central Excise Rules, 1944.

(c)  availing facility/ without availing facility under Rule 13(1)(b) of Central Excise Rules, 1944.

We hereby declare that the export is in discharge of the export obligation under a Quantity based Advance Licence/ Value based Advance Licence/ Under Claim of Duty Drawback under Customs & Central Excise Duties Drawback Rules, 1971.”

9.1  The original, duplicate and sixtuplicate copies of the AR4 shall be presented by the exporter/ his authorized agent to the Customs Officer at the point of export along with the goods, Shipping bill/ Bill of Export and samples sealed by the Central Excise Officer. The export consignment shall be checked by the Customs Officer to see whether the seals are intact and the marks and number tally and in found in order he may allow exports after ensuring that the No. of the AR 4 has been indicated in the Shipping Bill or the Bill of Export, as the case may be. The samples shall be dealt in accordance with instructions/ standing orders of the Collector of Customs or the Central Board of Excise and Customs. In case goods are removed from the factory without the supervision of Central Excise Officer, Customs Officer shall carry out the usual examination and draw samples as per standing instructions. After the goods have been shipped the proper officer of Customs would make necessary endorsements in the Original, Duplicate and Sixtuplicate copies of the AR4 at appropriate places and put his stamp with his name and designation below his signature. The copies of AR4 shall be disposed off by him in the following manner:-

Original and Sixtuplicate: To be Handed over to the Exporter. Criginal shall be used for filing proof of export for getting the bond discharged. Sixtuplicate copy shall be used for Drawback/ DEEC endorsement. The sixtuplicate copy of AR4 shall be presented by the exporter for claiming Drawback or endorsement of exports in the DEEC. At that stage the same shall be retained by the Customs House for its records.
Duplicate: To be sent to authority before whom the bond is executed and declared on AR4. This copy on a request of exporter may be sealed and handled over to the exporter/his authorized agent for presenting to the authority declared on AR4 [Maritime Collector of Central Excise or the Jurisdictional Assistant Collector of Central Excise].

Filing of Proof and discharge of Bond

10.1  Following documents should be filed by the exporter for proof of due exportation-

–  Original copy of AR4

–  Duplicate copy of AR4 in sealed cover received from Customs Officer [(optional)]

–  Duty attested copy of Bill of Lading

–  Duly attested photocopy of Shipping Bill (Export Promotion Copy)

10.2  With Maritime Collector of Central Excise: Where the export of the goods is from any of the ports, airports or post offices falling within the Jurisdiction of Maritime Collector of Central Excise of Bombay, Calcutta, Madras, Paradeep, Vishakhapatnam, Cochin, Kandla and the exporter had executed the bond before such Maritime Collector of Central excise or has obtained BLOCK TRANSFER in his favour and declared the same on AR4, he will file as proof of due exportation the documents listed in para 10.1 above to Maritime Collector of Central Excise who shall compare the original AR4 received from the exporter with the triplicate copy of the AR4 received from the Central Excise Officer and the duplicate AR4 received from the Customs Officer either direct or from the exporter in Customs seal cover. The Maritime Collector after due scrutiny and verification of the said AR4s, will record the proof of export and discharge the bond and also inform the fact of acceptance of the proof of export to the jurisdictional Superintended of Central Excise. Where the proof of export is admitted against BLOCK TRANSFER, the Maritime Collector shall return the BLOCK TRANSFER to the authority before whom bond is executed and also intimate him the fact of acceptance of proof of export.

10.3  With Assistant Collector, Central Excise having jurisdiction over the factory:    Where the exporter has executed the bond before the Assistant Collector having jurisdiction over the factory or warehouse or has obtained BLOCK TRANSFER in his favour, from where the goods were removed for export, he will file as proof of due exportation the documents listed in para 10.1 above before such Assistant Collector. The Assistant Collector of Central Excise, would verify and compare the original copy of AR4 with the duplicate copy of AR4 received from the Customs Officer either direct or in Customs seal cover from the exporter with the triplicate copy of AR4 received from Superintendent, Central Excise Range and after Satisfying himself that the proof is in order admit the proof of export and will discharge the bond. Where the proof of export is admitted against BLOCK TRANSFER, the Assistant Collector shall return the BLOCK TRANSFER to the authority before whom bond is executed and also intimate him the fact of acceptance of proof of export.

10.4  Partial Export:

If the scrutiny of AR4 reveals that only part of the consignment removed in bond for export has actually been exported out of India, the Assistant Collector of Central Excise or the Maritime Collector of Central Excise, as the case may be, shall forthwith call upon the bonder to pay within 10 days the duty leviable on the quantity short-shipped in terms of the bond. Such demands should be made by letter as prescribed in Annexure 2. Where the bond is executed with the Maritime Collector of Central Excise, the assessable value and the rate of duty leviable [see para 15.11 on quantity short shipped shall be worked out by such Maritime Collector and got verified and confirmed by the Assistant collector having jurisdiction over the factory of manufacture/warehouse from where the goods were cleared for exports. Where the bond is executed with the Assistant Collector having jurisdiction over the factory, he will work out the duty recoverable and demand the same from the person who has executed the bond. An endorsement of the recovery of duty on quantity short shipped would be made in all the three copies of the AR4 in the following form:-

“Proof of export admitted to the extent of duty amounting to Rs……. .. in Figs. (……… in words). Duty on goods short-shipped (quantity short shipped ……), amounting to Rs. …….. in figs. (……… in words) demanded under demand No. ……… dated ……….. and recovered vide Challan No ……… dt ………. of ………..(Name of the Bank)”

11. Small Scale Units:

Units which are otherwise eligible for benefit under and of the Central Excise Notification granting partial or full Exemption based on value of clearances for home consumption may be exempted from filing AR4 and Bond. In view of the exemption from filing AR4 and bond, the facility of sealing of the export consignment at place of despatch under rule 187 of Central Excise Rules, 1944 cannot be availed. This shall be extended to only such of the units which export whole of their production either themselves or through merchant exporters. However where exports are by merchant exporters, it will be necessary that the shipping bill/ bill of export contains the name of the units as manufacturer. Units who are availing.

–  facility of Modvat credit under rule 57A of Central Excise Rules, 1944.

–  facility under Rule 12 (1) (b) of Central Excise Rules, 1944

–  facility under Rule 13 (1) (b) of Central Excise Rules, 1944 shall follow regular procedure of AR4 and bond for exports.

12 Diversion of Export Goods for home consumption-

Cancellation of Export documents.

12.1. An exporter intending to divert the excisable goods, cleared for export in bond, for home consumption should send an intimation together with the original, duplicate and sixtuplicate copies of the AR4 to the authority with whom bond is executed and declared as such on the AR4 (i.e. the Maritime Collector of Central Excise or the Assistant Collector of Central Excise having jurisdiction over the factory). Where the bond is executed with the Maritime Collector of Central excise, a copy of the intimation sent to the Maritime Collector shall also be endorsed to the Assistant Collector of Central Excise having jurisdiction over the factory.

12.2 The intimation referred in para above shall contain following minimum information.

i) Description of the goods to be diverted for home consumption.

ii) Identification marks.

iii) No. of packages and complete description of packages.

iv) Quantity.

v) Assessable Value under Section.

vi) Amount of duty due.

vii) Reasons for diversion for home consumption.

viii) Place where the said goods are lying pending for home consumption.

12.3 Where Bond Is Executed With Maritime Collector.

On receipt of intimation referred in para 12.2 above the Maritime Collector of Central Excise would seek verification of the goods including the description of Packages, identification marks etc. from the Superintendent of Central Excise having jurisdiction over the place where the goods are stored pending diversion for home consumption. He will also simultaneously refer the matter to the Assistant Collector of Central Excise having jurisdiction over the factory, for determination of Assessable value [under Section 4 of the Central Excise and Salt Act, 1944] and duty leviable. After receipt of verification report regarding storage from the Superintendent of Central excise and after confirming the duty leviable from the jurisdictional Assistant Collector, the Maritime Collector of central Excise shall recover the duty. After satisfying that the duty has been paid, be would cancel the Original, Duplicate and Sixtuplicate copies of AR4 and note the fact of Cancellation in his records. He will also cancel the bond and inform the Assistant Collector having jurisdiction over the factory.

12.4 Where Bond Is Executed With Jurisdictional Assistant Collector.

On receipt of intimation referred in para 12.2 above, the Assistant Collector of Central Excise having jurisdiction over the factory from where goods were cleared for exports shall seek verification of the goods including the description of packages, identification marks etc. from the Superintendent of Central Excise having jurisdiction over the place where the goods are stored pending diversion for home consumption. After receipt of verification report regarding storage from the Superintendent of Central Excise and after working out the Assessable value [under Section 4 of the Central Excise and Salt Act, 1944] and the duty leviable, he shall recover the duty leviable, he shall recover the duty. After satisfying that the duty has been paid, he would cancel the Original, Duplicate and Sixtuplicate copies of AR4 and note the fact of Cancellation in his records. He will also cancel the bond and inform the Concerned Maritime Collector of Central Excise.

13. Re-entry of the goods, cleared for export under Bond but not actually exported, in the factory of manufacture.

Sub-Rule (1A) of Rule 173M of the Central Excise to allow return of goods cleared for export under bond but not actually exported provided such goods are returned to the factory within one year and the assessee gives intimation of the re-entry of each consignment in Form D-3 within twenty-four hours of such re-entry. Further, such goods are to be stored and accounted for separately.

14. Re-import of exported goods for repairs etc. and subsequently re-exported.

In Rule 173 MM, provision have been made for permitting re-entry of goods that have been re-imported for undertaking repairs, re-conditioning etc. and subsequent re-export therefor. It may, however, be specifically noted that such permission fro re-entry will be granted in those cases where the goods after being subjected to the specified processes, are to be re-exported out the country.

14.1  For return of the exported excisable goods to the factory of manufacture for carrying out (i) repairs, (ii) re-conditioning, (iii) refining, (iv) re-making or subjecting to any process similar to processes, referred to in (i) to above:-

(a) The manufacturer shall make an application in writing well in advance to the Collector, Central Excise having jurisdiction over the factory where the above processes are to be undertaken. The application should contain details of the:-

(i)    Premises including Central Excise Licence Number where the processing operation is to be undertake

(ii) Particulars of the goods re-imported and sought to be returned to the factory.

(iii) Nature of processing along with collateral evidence to show that such processing is absolutely necessary in the case,

(iv) Expected date and time of commencement and completion of the processing, (b)    If permission for such processing is accorded, it would be subject to the following conditions:- (i)    Excise supervision over such processing operation will be required.

(ii) Supervision charges will be recovered as prescribed under para 38.39 of this Guide for rates of such charges.

(iii) On arrival of the excisable goods in the processing factory an intimation in proforma as given in Annexure 49 should be given to the proper Central Excise Officer within 24 hours of their receipt, along with the original documents etc.

(iv) The goods should be stored separately in the factory after receipt and should not be taken for processing etc., before verification by the Central Excise Officer.

(v) Proper accounts of the goods received for repairs, reconditioning etc., should be maintained in the form as shown in Annexure 50. 14.2    After the processing etc. operations are completed, a fresh AR4/AR4A/ Invoice(s) will be issued by the Central Excise Officer, with a suitable endorsement thereon to the effect that no rebate/ drawback in respect of the goods which are being re-exported as well as the goods used in the manufacture thereof is admissible. The disposal of the AR4s shall be as usual, with necessary instructions by the Central Excise Officer to the Officer of original manufacturer.

Miscellaneous

15.1 Rate of Duty:    In terms of sub-rule (3) of rule 9A of the Central Excise Rules, 1944, in case of exports under bond, in absence of proper proof of export, the rate of Central Excise duty leviable is the rate in force on the date on which Central Excise duty is paid. Central Excise Officers dealing with the situations, where it becomes necessary to recover Central Excise duty on goods cleared for export under bond, such as short shipment or diversion of export goods for domestic consumption etc. Should ensure that the Duty liability is calculated with reference to rate of duty in force on the date of actual payment.

15.2 Numbering of AR4:    Every AR4 shall contain a running serial of the Factory starting with 1 every financial year.

15.3 Appointment of Maritime Collectors:    Collectors of Central Excise who are functioning as Maritime Collector of Central Excise shall in the Trade Notice clearly specify the postal Address of the authority designated as Maritime Collector who will sanction the rebate claim and admit proof of exports in case of exports under bond.

15.4 Where the bonds executed by the merchant exporter, both the exporter and the manufacturer shall sign the AR4.

15.5 Collectors may having regard to the nature of goods or trade practice relax any of the conditions regarding marking on the export packages recording the reasons. Necessary trade notice may be issued for this purpose.

Issual of Trade Notice etc.

16.    Collectors may also issue detailed Trade Notice/ s and Standing Order/s in this regard. Copies of all Trade Notices and Standing Orders may be endorsed to Board and DGCCE.

Annexure 1 and 2 are enclosed.

Your faithfully,
Sd/-
(I.P. Lal)

Deputy Secretary to the Government of India


Proforma of Running Bond Account to be Maintained by Assistant

Collector of Central Excise in respect of Consolidated B-1 (General)

Bonds Executed With Them.

1. Name of the Exporter

2. Address of the Exporter

3. Consolidated B-1 Bond No. & Amount of Bond.

4. Whether with Surety of Security.

5. Name of Surety & his complete address.

6. Whether financial soundness of the surety has been verified.

Date Particulars Credit Rs. Debit Rs. Balance Remarks Signature of Asstt. Collr.
Opening Balance Cr……….

Note:-

1. Debit & Credit entries should be entered in separate lines.

2. Opening Balance is the amount of Bond as soon as it is executed and accepted.

3. Debit entry shall be made on Block Transfer, while issuing certificate of Provisional debit or exports.

4. Credit entry shall be made on acceptance of proof of export or return of Block Transfer.


 Annexure 2

Proforma of Demand in respect of Short Shipment of Exports Cleared

Without Payment of Central Excise Duty Under Bond

From

____________________________

____________________________

To

_____________________________

_____________________________

Subject: Demand in respect of short shipment of exports cleared without payment of C. Ex. duty under bond.

Kindly refer to AR4 No. ………….. under which (qty.) of ………….. (description of goods) were taken clearance without payment of Central Excise duty on your execution of Bond No. ………. On scrutiny of the documents submitted by you as proof of export, it is observed that only ……….. Qty. of ………. (Description of goods) have been shipped under S.Bo. No./Bill of export No. ………… dated ………….. from ……….. (Name of port/ airport /ICD/LCS). The quantity short shipped is …………….. (qty.) of ………… (description  of goods) on which Central Excise duty payable works out to be Rs…………. (as detailed in annexure).

You are hereby called upon to deposit the difference within 10 days failing which it should be explained to (Name of officer to be given) as to why action shall not be taken for recovery in terms of the Bond executed and other provisions of Central Excise Law.

(You are further required to state as to why penal actions shall not be taken against you for contravention of C.E. Rules. (Relevant rules to be cited).

Superintendent of Central Excise (Seal)

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