G.S.R. (E). In exercise of the powers conferred by sub-rule (3) of rule 19 of the Central Excise (No.2) Rules, 2001, the Board hereby specifies the conditions, safeguards and procedures for export of all excisable goods without payment of excise duty from the factory of production or manufacture, warehouse or any other premises as may be approved by the Commissioner of Central Excise, namely: -

1. Conditions and safeguards: -

1. Export under bond to Bhutan [OLD-  Nepal or Bhutan ]where payment is in freely convertible currency. –

Export under bond to Bhutan [OLD- Nepal or Bhutan ] where payment is in freely convertible currency, shall be subject to following conditions, namely: -

i. the importer in Bhutan [OLD- Nepal or Bhutan], as the case may be, shall make full payment for the goods as evidenced by furnishing Foreign Inward Remittance Certificate from any bank authorized to deal with foreign exchange by Reserve Bank of India or shall open an irrevocable letter of credit in favour of the exporter in India, before the export takes place;.

(Above clause i. has been substituted vide Ntf. No. 20/2002-CE-(NT), Dt. 14/05/2002)

[OLD - i. the importer in  Bhutan [OLD- Nepal or Bhutan ] , as the case may be, shall open an irrevocable letterof credit in favour of the exporter in India, before the export takes place;]

ii. condition (i) shall not apply if the excisable goods other than consumer goods, butexcluding motor vehicles, are exported without payment of duty as:-

a. supplies to projects financed by any United Nations agency, the InternationalBank for Reconstruction and Development, International DevelopmentAssociation, the Asian Development Bank or any other multilateral agency oflike nature;

b. to all diplomatic missions in Bhutan [OLD-  Nepal or Bhutan] provided the Indian Embassy orthe Ministry of External Affairs certifies that the import is for the personnel ofthe diplomatic community;

iii. the exporter shall furnish a bond in Form specified in Annexure-I before the AssistantCommissioner of Central Excise or the Deputy Commissioner of Central Excisehaving jurisdiction over the factory, warehouse, or the approved premises or suchother officer as authorised by the Board on this behalf, from where the goods are removed for export to Bhutan [OLD-  the goods are removed for export to Nepal, as the case may be, or Bhutan];

iv. when the export is against an irrevocable letter of credit, the exporter shall furnish a certificate in Form as specified in Annexure-II from theReserve Bank of India or any other bank authorised to deal in foreign exchange by theReserve Bank of India, showing that full payment for the goods has been dulyreceived in freely convertible currency. On receipt of such a certificate and on thesatisfaction that the goods have been exported in terms of the bond referred to in sub-condition (iii), the Assistant Commissioner of Central Excise or the DeputyCommissioner of Central Excise or the such other officer as authorised by the Boardon this behalf shall discharge the exporter of his liabilities under the bond;

(In clause (iv) the bold line has been inserted vide Ntf. No. 20/2002-CE-(NT), Dt. 14/05/2002)

Explanation I : ‘Freely convertible currency’ means Australian Dollars, Australian Schillings, Bahrain Dinars, Belgian Francs, Canadian Dollars, Danish Kroners, Deutsche Marks, European Currency Units (Euros), French Francs, Hongkong Dollars, Italian Lire, Japanese Yen, Kuwaiti Dinars, Malaysian Dollars, Netherlands Guilders, Norwegian Kroners, Pounds Sterling, Singapore Dollars, Swedish Kroners, Swiss Francs and U.S.A. sDollars (and includes Indian Rupees bought by the Asian Development Bank by payment to the Reserve Bank of India in foreign exchange).

(In above sub-paragraph (1) the word "Bhutan"  & "the goods are removed for export to Bhutan" has been substituted vide NTF. NO. 29/2011-CE (NT), DT. 05/12/2011 )

(Above Explanation has been substituted vide Notification No.15/2002-Central Excise (N.T)., Dt. 22/03/2002)

Explanation II: For export of goods to Bhutan, payment for the goods may be received in Indian Rupees and such payment shall be deemed to be in freely convertible currency.

(Above Explanation re numbered & Explanation II has been inserted  vide NTF. NO. 25/2017-CE (NT), DT. 16/08/2017)

[OLD- Explanation. - "Freely convertible currency" means Australian Dollars, Austrian Schillings, Baharin Dinars, Belgian Francs, Canadian Dollars, Danish Kroners, Deutsche Marks, French Francs, Hongkong Dollars, Italian Lire, Japanese Yen, Kuwaiti Dinars, Malaysian Dollars, Netherlands Guilders, Norwegian Kroners, Pounds Sterling, Singapore Dollars, SwedishKroners, Swiss Francs and U.S.A. Dollars (and includes Indian Rupees bought by the AsianDevelopment Bank by payment to the Reserve Bank of India in foreign exchange).]

[OMITTED - 2. Export to Nepal in bond against payment in Indian rupee. – Notwithstanding anythingcontained in condition (1) above, export of capital goods under a bond directly from the factory of manufacture to Nepal against any global tender invited by His Majesty's Government of Nepal without payment of duty, for which payment is received in Indian currency, shall be subject to the following further conditions, namely: -

i. the exporter shall furnish a bond in Form as specified in Annexure-I before theAssistant Commissioner of Central Excise or the Deputy Commissioner of CentralExcise or such other officer as authorised by the Board on this behalf; and

ii. the exporter shall furnish a certificate in the Form specified in Annexure-II dulysigned by the concerned bank in India showing that full payment for the goods hasbeen duly received in Indian currency by the said bank;

(In above sub-paragraph (2) relating to “Export to Nepal in bond against payment in Indian rupee” has been omitted vide NTF. NO. 29/2011-CE (NT), DT. 05/12/2011 )

2. On receipt of the certificate referred to in sub-condition (ii) and on the satisfaction that the goods have been exported in terms of bond referred to in sub-condition (i), the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise or such other officer as authorised by the Board on this behalf shall discharge the exporter of his liabilities under the bond.

Explanation. - The “capital goods” means the goods, that is to say, all items of machinery including prime movers, instruments, apparatus and appliances, control gear and transmission equipment as well as auxiliary equipment (including those required for research and development purpose, testing and quality control), required by an investor for production of goods or for rendering services, including those for replacement or expansion.

3. Export in bond of petroleum oil, liquified petroleum gas and lubricant products to Nepal. – Notwithstanding anything contained in condition (1) above, the export in bond without payment of duty of excise of petroleum oil, liquified petroleum gas and lubricant products to Nepal, through the agency of Nepal Oil Corporation from calibrated stocks of M/s Indian Oil Corporation registered as a warehouse in accordance with the provisions rule 20 the Central Excise (No.2) Rules, 2001, and situated at places notified for the purpose, from time to time, or purchased without payment of duty from tanks of other Oil Companies or Undertakings is permitted provided that the Indian Oil Corporation shall execute a bond in the form specified in Annexure-I, to cover removals of petroleum oil, liquified petroleum gas and lubricant products to be exported for such amount and in such manner as may be determined by the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise having jurisdiction over
the installation from which the petroleum oil, liquified petroleum gas and lubricant products are to be exported.

(In sub para (3) bold words has been substituted vide Ntf. No. 03/2003-CE(NT), Dt. 30/01/2003)

4. Export in bond for supplies to Government of India Aided Projects in Nepal and the Embassy Cooperative Store and Embassy Petrol Pump located in Nepal for the bonafide useof officers and staff of the Embassy in Nepal. – Export in bond for supplies to Government of India Aided Projects in Nepal and the Embassy Cooperative Store and Embassy Petrol Pump located in Nepal for the bonafide use of officers and staff of the Embassy in Nepal shall be subject to the following conditions, namely: -

i. the exporter shall furnish a bond in Form as specified in Annexure-I before theAssistant Commissioner of Central Excise or the Deputy Commissioner of CentralExcise or such other officer as authorised by the Board on this behalf; and

ii. the First Secretary (Economic), Embassy of India, Nepal, certifies the signature andstamp or seal of the person authorised to place the order for supply of excisablegoods to the specified Government of India Aided Projects in Nepal;

5. Export of all excisable goods without payment of duty to Kurichu Hydro Electric Project, Tala Hydro Electric Project, Punatsangechhu-I Hydro Electric Project, Punatsangchhu-II Hydro-Electric Project, Mangdechhu Hydro-Electric Project and Kholongchhu Hydro Electric Project  [OLD- Kurichu Hydro Electric Project, Tala Hydro Electric Project, Punatsangchhu- I Hydro Electric Project, Punatsangchhu-II Hydro Electric Project, Mangdechhu Hydro Electric Project and Kholongchhu Hydro Electric Project ]in Bhutan;

[OLD- Export of all excisable goods without payment of duty to Kurichu Hydro Electric Project, Tala Hydro Electric Project, Punatsangechhu-I Hydro Electric Project, Punatsangchhu-II Hydro-Electric Project and Mangdechhu Hydro-Electric Project ] [OLD-Kurichu Hydro Electric Project, Tala Hydro Electric Project and Punatsangechhu-I Hydro Electric Project] [OLD-Kurichu Hydro Electric Project and Tala Hydro Electric Project in Bhutan.] –.

(Above marginal heading at sub-paragraph(5) has been substituted vide NTF. NO. 03/2016-CE (NT), DT. 03/02/2016)

Export of all excisable goods without payment of duty to Kurichu Hydro Electric Project and Tala Hydro Electric Project in Bhutan shall be subject to the following conditions, namely: -

(In above sub-paragraph (5) the words "Kurichu Hydro Electric Project, Tala Hydro Electric Project, Punatsangechhu-I Hydro Electric Project, Punatsangchhu-II Hydro-Electric Project and Mangdechhu Hydro-Electric Project" has been substituted vide NTF. NO. 02/2011-CE(N.T.), DT. 18/02/2011)

(In above sub-paragraph (5) the words "Kurichu Hydro Electric Project, Tala Hydro Electric Project and Punatsangechhu-I Hydro Electric Project" has been substituted vide NTF. NO. 08/2008-CE(N.T.), DT. 11/02/2008)

i. the exporter shall furnish a bond in Form as specified in Annexure-I before the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise or such other officer as authorised by the Board on this behalf;

ii. the goods are supplied against one or more specified contract which have beenregistered with the Directorate General of Inspection, Customs and Central Excise inthe manner specified in Annexure III;

iii.the goods are covered by a release order issued by an officer authorised by theGeneral Manager of the concerned project authority;

iv. the exporter furnishes a bond in the Form specified in Annexure-I to the AssistantCommissioner of Central Excise or the Deputy Commissioner of Central Excisehaving jurisdiction over the factory or warehouse or the approved premises or fromwhere the goods are removed for export to the specified project or such other officeras authorised by the Board on this behalf.

2. Procedure: -

1. Procedure at the place of despatch. -

(i) Six copies of invoice in the Form specified under Annexure-IV shall be presented to the Superintendent or Inspector of Central Excise having jurisdiction over the factory, warehouse or any other approved premises along with the export goods;

(ii) in case of export for supplies to Government of India Aided Projects in Nepal and the Embassy Cooperative Store and Embassy Petrol Pump located in Nepal for the bonafide use of officers and staff of the Embassy in Nepal, the order from Project Implementation Authority shall also be presented;

(iii) the Superintendent or Inspector of Central Excise having jurisdiction over the factory, warehouse or any other approved premises shall verify the identity of goods with reference to description mentioned in the invoice and the particulars of the duty payable but for export, and if found in order, he shall seal the consignment, tank or container with Central Excise seal or in such other the manner as may be specified by the Commissioner of Central Excise and endorse each copy of the export invoice in token of having such verification and examination done by him;

(Please refer Cir. No. 741/57/2003-CX, Dt. 02/09/2003 Self-sealing of Export Goods - related to above clause (iii))

(iv) the goods shall be delivered to the exporter or his agent, together with the original copy of the invoice, duly completed and registered. The said officer will also give duplicate, triplicate and quadruplicate copies of invoice in a sealed cover, to the exporter or his agent for delivery to the Customs officer in-charge of the Land Customs Station through which the goods are intended to be exported and will obtain acknowledgement to this effect.

(iii) the exporter or his agent shall then be free to remove the goods for export to Nepal through the Land Customs Station indicated on the respective invoices;

[OMITTED -
(iv) where the goods are exported by land, the export shall take place through any of the following land customs stations, namely, Sukhiapokhri, Panitanki, Jogbani, Jayanagar, Bairgania, Bhimnagar, Bitamore (Sursand), Raxaul, Sonauli, Barhni, Nepalganj Road, Shohratgar (Khunwa), Jarwa, Katarniaghat, Gauriphanta, Banbasa, Jhulaghat, Dharchula, Naxalbari, Galgalia, Kunauli, Sonabarsa, Tikonia, or such other check-post as may be specified by the Board; ]

(Above paragraph 2, sub-paragraph (1), item (iv) has been omitted vide NTF. NO. 29/2011-CE (NT), DT. 05/12/2011 )

(v) the quintuplicate copy shall be forwarded to the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise who has accepted the bond; and

(vi) the said Superintendent or Inspector of Central Excise shall retain the sixtuplicate copy of the invoice.

2. Procedure at the Land Customs Station. –

(i) the exporter or his agent shall present the goods to the officer of customs in-charge of the land customs station along with the original copy of the invoice and the sealed cover containing duplicate, triplicate and quadruplicate copies and obtain acknowledgement;

(ii) Where the contents of all the copies of invoices tally and the packages, goods or container are satisfactorily identified with their seals in tact, the officer of customs in-charge of the land customs station shall make necessary entries in the register maintained at the land customs station and allow the goods to cross into the territory of Nepal or Bhutan and certify accordingly on each of the four copies of the invoice and indicate the running serial number in red ink prominently visible and encircled. In case the seals are notfound intact, the officer of customs in charge of the land customs station may re-seal the containers with his own seal after satisfying himself as to the identity of the containers and the goods from the particulars shown on the invoice by opening and examining the goods, if necessary;

(iii) the officer of customs, then deliver the original copy of the invoice duly endorsed to the exporter or his agent alongwith the goods for presentation to the Customs Officer of Nepal or Bhutan. He shall also send, directly the duplicate and triplicate copies of the invoice to the Nepalese or Bhutanese Customs Officer in-charge of the check post through which the goods are to be imported into Nepal or Bhutan, as the case may be;

(iv) the goods are then to be produced before the Nepalese or Bhutanese Customs Officer, as the case may be, at the corresponding border check-post alongwith the original copies of the invoice. The Nepalese or Bhutanese Customs Officer shall deal with the original and triplicate copies of the invoice as directed by His Majesty's Government of Nepal or His Majesty’s Government of Bhutan and return the duplicate copy, after endorsing his certificate of receipt of goods in Nepal or Bhutan, as the case may be, directly to the officer of customs-in-charge of the land customs station in India;

(v) The officer of customs in-charge of the land customs station shall forward the duplicate copy to the Central Excise Officer in charge of the factory or warehouse from which the goods were removed for export without payment of duty. For this purpose, the said officer in charge of the land customs station should keep a note of the return of duplicate copies from the Customs Officer of Nepal or Bhutan and remind the exporter for such copies as have not been received, failing which the exporter may be liable to pay full duty on such consignments;

(vii) the officer of customs officers, at the land customs station shall also maintain a separate record of all such in-bond exports of the goods without payment of duty and shall assign running serial number on the invoice at the time of export as indicated earlier;

3. Procedure for discharge of bond or the duty liability. -

(i) the exporter shall submit the quadruplicate copy duly endorsed by the officer of customs in-charge of land customs station to the Central Excise officer who has accepted the bond alongwith bank, certificate evidencing receipt of payment in freely convertible currency, in case of Bhutan, it is in Indian Rupees,  within six months from the date of removal of the goods. The Central Excise officer will tally the particulars with quintuplicate copy of the invoice received from the Central Excise officer who has allowed clearance from the factory or warehouse or any other approved premises and make suitable entries in Bond Account of the exporter, giving provisional credit or discharging the bond provisionally. On receipt of the duplicate copy of invoice, dulyendorsed by customs officer of Nepal or Bhutan from the customs officer in charge of land customs station, certifying export of the goods and after tallying the particulars with those in quadruplicate copy of the invoice make suitable entries in Bond Account and the obligation under the said bond will then be discharged.

(In above item (i) the words "in case of Bhutan, it is in Indian Rupees," has been inserted  vide NTF. NO. 25/2017-CE (NT), DT. 16/08/2017)

(ii) in case of failure to export within six months from the date of removal from the factory or warehouse or any other approved premises, or shortages noticed, the exporter shall discharge the duty liability on the goods not so exported or shortage noticed along with interest prescribed under section 11AA [OLD - section 11AB] of the Central Excise Act, 1944 thereon [OLD- along with twenty four per cent. interest thereon ] from the date of removal for export without payment of duty till the date of payment of duty in terms of the bond.

(In paragraph 2, in sub-paragraph (3), in clause (ii) the word figures & letters "section 11AA" has been subsituted vide NTF. NO. 14/2012-CE (NT), DT.17/03/2012 ]

(In paragraph 2, sub-paragraph (3) in clause (ii), the words "along with interest prescribed under section 11AB of the Central Excise Act, 1944 thereon" has been substituted vide NTF. NO. 21/2007-CE(N.T.), DT. 19/04/2007)
 

Annexure-I

Signature(s) of obligor(s).


Date:

Place:


Witnesses
 

Date:

Place:


Signature(s) of surety (ies).


Date:

Place:


Witnesses
 

Accepted by me this.............................day of ...........(month).................……..(year)

………………………………..of Central Excise, (Designation)
for and on behalf of the President of India.



Annexure-II

This is to certify that the following Bills covering exports of ………………..to Nepal/Bhutandrawn by M/s.........……………………………have been negotiated and proceeds as given below receivedby us in the approved manner. We also certify that the payments thereof have been received in freely convertible currency.

Signature of Manager/Authorised officer
of the Bank with Official Stamp.

Notes:

1. This certificate should be on the Bank's letterhead and should bear the Official Stamp of the Bank.
    
2. This certificate will be issued only after the full proceeds of the Bill have been realised.

Annexure-III

REGISTRATION OF CONTRACTS

1. Every Project Authority specified in the notification desirous of obtaining supplies under benefits of this notification shall apply in writing to the Director General, Directorate General of Inspection (Customs and Central Excise) [hereinafter referred to as DGICCE], 5 th Floor, Drum Shape Building, I.P. Estate, New Delhi for registration of the contract through Ministry of External Affairs as soon as the contract has been concluded with the suppliers;

2. The application shall be accompanied by the original deed of contract and list of items duly approved by the Ministry of External Affairs;

3. The Project Authority shall also furnish such other documents or other particulars as may be required by the DGICCE in connection with the project.

4. DGICCE, on being satisfied, shall register the contract by entering the particulars in a Register maintained separately for each project and shall assign a number in token of registration and communicate the same to the Project Authority and shall also return to the project authority all original documents which are no longer required. This number shall be indicated on all the invoices and other related documents.

5. A copy of the contract so registered along with the approved list of items shall be forwarded to the Commissioner of Central Excise having jurisdiction over the factory/warehouse to which the contract pertains for extending benefits under this notification and consequent benefits under the Central Excise CENVAT Credit Rules, 2001 to the supplier.

AMENDMENT OF CONTRACT

1. If any contract referred to hereinabove is amended, whether before or after registration, the Project Authority shall make an application for registration of amendments to the said contract to the DGICCE.

2. The application shall be accompanied by the original deed of contract relating to the amendment and a list of items pertaining to amendment, if any, duly approved by the Ministry of External Affairs.

3. On being satisfied that the application is in order the DGICCE shall make note of the amendments in the relevant entries.

4. The DGICCE shall forward copy of the amended contract and the amended list of items, if any, to the concerned Commissioner of Central Excise.

FINALISATION OF CONTRACT

1. Each Project Authority shall submit a statement of supplies received on quarterly basis along with relevant invoices and other documents to the DGICCE within one month from the last date of the quarter.

2. The Commissioner of Central Excise to whom a registered contract has been forwarded shall forward a statement, after all the items covered under the contract have been exported, to the DGICCE.

3. The DGICCE shall, on receipt of the statement, reconcile both and, if satisfied, finalise the contract and close the entry in the register.

Annexure-IV

ORIGINAL
DUPLICATE
TRIPLICATE
QUADRUPLICATE

Invoice No. ______________ Date_____________

Range___________Division________Commissionerate___________from__________(factory/warehouse) by_____________ through the Border Post of._______________

(1) I/We hereby declare that the above-mentioned particulars are true and correctly stated and that the consignment of goods is intended for export to Nepal/ ______(place) and shall not be diverted en route to any other country.

Signature of exporter or his authorised agent.

Place:

Date:

(2) Certified that the above-mentioned packages have been identified by me and sealed with the Central Excise seal under my supervision.

Signature and designation of the Officer of Central Excise.

Running Serial No.

Date:

(3) Certified that the above-mentioned consignment has been duly identified by me and has passed the Border Customs Post.

(Running Serial number of the Border Check Post
to be written in red ink prominently encircled)

Signature and designation of the Indian
Officer-in-charge of the Border Customs Pos tat__________.

(4) Certified that the above-mentioned consignment/packages have been duly identified by me and have been received and accounted for in Nepal.

Signature and designation
(with official seal) of Nepalese/Bhutanese Customs Officer.
Check Post ____________

2. This notification shall come into force on 1 st July, 2001.

F.No.209/18/2001-CX.6



(P.K. Sinha)
Under Secretary to the Government of India

[Note:- see following Parts of Chapters as mentioned in
New Central Excise Manual 2001 (w.e.f. 1/9/2001)
Part I of Ch. 7; Part IV of Ch. 7]