Home India Ministry of Commerce and Industry Amendments of para 449g under Chapter 4 of the Handbook of P...
Date: 23-Aug-2024 Category: Extra Ordinary State: Union Government Country: India

Amendments of para 449g under Chapter 4 of the Handbook of Procedures 2023 to reduce Compliance Burden and enhance Ease of doing Business reg

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

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Executive Summary & Key Takeaways

Description of the Gazette Notification

  • This public notice, issued by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, on August 22, 2024, amends paragraph 4.49(g) of Chapter 4 of the Handbook of Procedures, 2023. The amendment aims to reduce compliance burden and enhance ease of doing business by simplifying the procedures related to the handling of unutilized imported quantities under Advance Authorisations.

Key Changes

  • Amendment to Para 4.49(g)(i): Previously, authorization holders were required to submit documents showing consumption of imported quantities and, in case of shortfall, provide a self-declaration, chartered accountant's certificate, and affidavit-cum-indemnity bond for the destruction of unutilized duty-free imported material or proof of re-export to the same supplier. The amendment now allows for all types of shipping bills in lieu of the destruction certificate, simplifying the process.
  • Amendment to Para 4.49(g)(ii): Previously, exports of unutilized drugs after the Export Obligation period were only accepted in lieu of a destruction certificate if re-exported to the same supplier. The amendment now accepts such exports regardless of the supplier, provided the drug description and characteristics match the Advance Authorisation. However, applicable customs duty and interest remain payable on the unutilized quantity.

Impact Analysis

Impact on Authorization Holders

  • Potential cost implications: While paperwork is reduced, customs duties and interest remain payable on unutilized quantities even with the simplified re-export option.

Impact on Government

  • Potential revenue implications: While the amendment simplifies processes, it might lead to a slight decrease in revenue if more unutilized quantities are re-exported instead of being destroyed. However, this is offset by improved ease of doing business and potential increase in exports.

Suggested Action Items

  • Monitor the impact of the amendments on compliance burden and government revenue.

Key Entities Referenced

Directorate General of Foreign Trade (DGFT): The issuing authority of the public notice, responsible for regulating foreign trade in India. Ministry of Commerce and Industry: The parent ministry under which DGFT operates. Handbook of Procedures, 2023: The document amended by this public notice, outlining procedures for foreign trade. Foreign Trade Policy, 2023: The overarching policy under which the Handbook of Procedures operates. Advance Authorisation: A type of import license mentioned in the gazette, allowing duty-free import of goods for export production.
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रजिस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. 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F. No. 01/94/180/043/AM25/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 Chapter 4 of the Handbook of Procedures, 2023 with immediate effect:[भाग I—खण् ड 1] भारत का रािपत्र : असाधारण 3 S. No. Para Existing Provision Revised Provision No. 1 4.49 The Authorisation holder shall submit The Authorisation holder shall submit g (i) documents showing consumption of full documents showing consumption of full imported quantity as per norms. In case, there is imported quantity as per norms. In case, there is shortfall in fulfilment of Export Obligation and shortfall in fulfilment of Export Obligation and unutilized imported quantity remains with the unutilized imported quantity remains with the authorisation holder, the Authorisation holder authorisation holder, the Authorisation holder shall submit a self declaration along with the shall submit a self declaration along with the Charted Accountant’s certificate regarding Charted Accountant’s certificate regarding destruction of the unutilized duty free imported destruction of the unutilized duty free imported material accompanied by an affidavit-cum- material accompanied by an affidavit-cum- indemnity bond indemnifying the Government indemnity bond indemnifying the Government for any harm or loss occurring due to diversion for any harm or loss occurring due to diversion of such imported material from unregistered of such imported material from unregistered sources into domestic market that may be sources into domestic market that may be detected in future by any authority, or proof of detected in future by any authority, or proof of re-export of the same to the same supplier in re-export of the same in terms of Para 4.42 of terms of Para 4.42 of HBP. HBP. 2 4.49 Exports made under free shipping bills/under Exports made under any shipping bills /under g (ii) same authorisation after expiry of Export the same authorisation after expiry of Export Obligation period using unutilized quantity of Obligation period using unutilized quantity of drugs shall also be accepted in-lieu of drugs shall also be accepted in-lieu of submission of destruction certificate as stated in submission of destruction certificate as stated in para (i) above, provided the exact description para (i) above, provided the exact description and technical characteristics of the drug and technical characteristics of the drug exported matches with that of export item exported matches with that of export item described in the Advance Authorisation. described in the Advance Authorisation. However, the Authorisation holder shall pay However, the Authorisation holder shall pay customs duty with applicable interest to the customs duty with applicable interest to the Custom Authority on unutilized quantity Custom Authority on unutilized quantity imported under Advance Authorisation. The imported under Advance Authorisation. Such exports made outside Export Obligation period exports shall only be considered for waiver of shall only be considered for waiver of destruction certificate and not for waiver of destruction certificate and not for waiver of liability of applicable duties and interest. liability of applicable duties and interest. Effect of the Public Notice: Para 4.49 (g) (i) and Para 4.49 (g) (ii) of Chapter 4 of the Handbook of Procedures 2023, have been amended by inclusion of all types of Shipping Bills in lieu of Destruction Certificate and simplified provision for re-export of un-utilized drugs removing the need to re-export to the same supplier, for ease of doing business and reduction of compliance burden. SANTOSH KUMAR SARANGI, Director General of Foreign Trade Ex-officio Addl. Secy. 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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