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Date: 16-Jul-2024 Category: Extra Ordinary State: Union Government Country: India

Amendment in Para 449 b of the Handbook of Procedures 2023

Issued by Ministry of Commerce and Industry · Directorate General of Foreign Trade

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Executive Summary & Key Takeaways

Gazette Notification Description

  • This public notice, issued by the Directorate General of Foreign Trade (DGFT), amends paragraph 4.49(b) of the Handbook of Procedures, 2023. The amendment pertains to penalties imposed when export obligations are met in quantity but fall short in value.

Key Changes

  • Paragraph 4.49(b) of the Handbook of Procedures, 2023, has been amended to reduce the penalty for shortfall in export value when the quantity obligation is met.
  • Previously, if the export obligation was fulfilled in quantity but there was a shortfall in value, and value addition fell below the minimum prescribed, a penalty of 3% of the shortfall in FOB value was levied.
  • The amendment reduces this penalty to 1% of the shortfall in FOB value. The penalty is still only applicable if the value addition falls below the minimum prescribed.

Impact Analysis

Impact on Exporters

  • Action Item: Exporters should review the amended paragraph 4.49(b) and update their internal procedures to reflect the changes.

Impact on DGFT

  • Action Item: DGFT should disseminate information about the changes widely to ensure all stakeholders are aware of the updates.

Impact on Government Revenue

  • Action Item: The government may need to consider other revenue-generating mechanisms to offset the potential loss.

Key Entities Referenced

Directorate General of Foreign Trade (DGFT): The issuing authority of the public notice; responsible for regulating foreign trade in India. Handbook of Procedures, 2023: The document amended by the public notice; a key regulatory document for foreign trade in India. Foreign Trade Policy 2023: The overarching policy document under which the DGFT operates and which grants the authority to make the amendment. Ministry of Commerce and Industry: The ministry under which the DGFT functions.
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रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99 सी.जी.-डी.एल.-अ.-17072024-255490 xxxGIDHxxx CG-DL-E-17072024-255490 xxxGIDExxx असाधारण EXTRAORDINARY भाग I—खण्ड 1 PART I—Section 1 प्राजधकार स ेप्रकाजित PUBLISHED BY AUTHORITY स.ं 192] नई दिल्ली, मगं लवार, िुलाई 16, 2024/आषाढ 25, 1946 No. 192] NEW DELHI, TUESDAY, JULY 16, 2024/ASHADHA 25, 1946 ( ) (fons'k O;kikj egkfuns'kky;) ubZ fnYyh] 16 tqykbZ] 2024 —le;≤ ij ;Fkk la'kkfs/kr fon's k O;kikj uhfr 2023 ds iSjk 1-03 vkSj 2-04 ds rgr iznRr 'kfDr;ks a dk iz;kxs djrs gq, egkfun's kd] fon's k O;kikj ,rn~}kjk izfØ;k iqLrd 2023 ds iSjk 4-49 ¼[k½ ds izko/kkuksa es a fuEukuqlkj la'kks/ku djr s gSa% ;fn fu;kZr nkf;Ro ek=k ds vuqlkj iwjk dj fy;k gS ;fn fu;kZr nkf;Ro ek=k ds vuqlkj iwjk dj fy;k gS ysfdu ewY; ds vuqlkj bl es a deh vkxà gS r¨ ysfdu ewY; ds vuqlkj bl es a deh vkxà gS r¨ Ákf/kdkj i= /kkjd ij U;wure fu/kkZfjr ewY; lao/kZu Ákf/kdkj i= /kkjd ij U;wure fu/kkZfjr ewY; lao/kZu ÁkIr dju s ij tqekZuk ugÈ yxk;k tk;sxkA rFkkfi] ÁkIrdjus ij tqekZuk ugÈ yxk;k tk;sxkA rFkkfi] ewY; 4288 GI/2024 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART I—SEC.1] ewY; lao/kZu ;fn fu/kkZfjr U;wure ewY; lao/kZu ls uhps lao/kZu ;fn fu/kkZfjr U;wure ewY; lao/kZu ls uhps vk vk tkrk gS r¨ Ákf/kdkj i= /kkjd dks Mhth,QVh dh tkrk gS r¨ Ákf/kdkj i= /kkjd dk s Mhth,QVh dh ocs lkbV ds ek/;e ls vkWuykbZu ikrs i;ZUr fu%'kqYd ocs lkbV ds ek/;e ls vkWuykbZu ikrs i;ZUr fu%'kqYd ewY; es a deh ds 3 Áfr'kr jkf'k ds cjkcj Òkjrh; ewY; es a deh ds 1 Áfr'kr jkf'k ds cjkcj Òkjrh; #i;s eas tek djuk vifs{kr gksxkA #i;s eas tek djuk vifs{kr gksxkA lark"sk dqekj lkjxa h] egkfuns'kd fons'k O;kikj vkSj insu vij lfpo O;kikj dk s lqxe cukus vkSj vuqikyuksa esa dVkSrh djus grs q lajpuk 'kqYd dks de djds izfØ;k iqLrd] 2023 ds iSjk 4-49¼[k½ dks la'kksf/kr fd;k x;k gSA MINISTRY AND COMMERCE AND INDUSTRY (Department of Commerce) (DIRECTORATE GENERAL OF FOREIGN TRADE) PUBLIC NOTICE New Delhi, the16th July, 2024 No. 14 /2024-25 Subject: Amendment in Para 4.49 (b) of the Handbook of Procedures, 2023 F. No. 01/94/180/082/AM24/PC-4— In exercise of powers conferred under paragraph 1.03 and 2.04 of the Foreign Trade Policy 2023, as amended from time to time, the Director General of Foreign Trade hereby makes the following amendments in the provisions of Para 4.49 (b) of the Handbook of Procedures 2023: Existing para 4.49 (b) Amended para 4.49 (b) If the Export Obligation is fulfilled in quantity but there If the Export Obligation is fulfilled in quantity but there is shortfall in value, no penalty shall be imposed if is shortfall in value, no penalty shall be imposed if Authorisation holder has achieved minimum Value Authorisation holder has achieved minimum Value Addition prescribed. However, if Value Addition falls Addition prescribed. However, if Value Addition falls below the minimum Value Addition prescribed, below the minimum Value Addition prescribed, Authorisation holder shall be required to deposit an Authorisation holder shall be required to deposit an amount equal to 3% of shortfall in FOB value in Indian amount equal to 1% of shortfall in FOB value in Indian Rupee, online through DGFT website. Rupee, online through DGFT website. SANTOSH KUMAR SARANGI, Director General of Foreign Trade Ex-officio Addl. Secy. Effect of the Public Notice: Para 4.49 (b) of the Handbook of Procedures, 2023 has been amended, reducing the composition fee, for ease of doing business and reducing compliances. Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064 and Published by the Controller of Publications, Delhi-110054.

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