APPENDIX - 42
GUIDELINES FOR SALE OF GOODS IN THE DOMESTIC TARIFF AREA(DTA)BY EOU/EPZ/EHTP/STP UNITS:
NOTE: Please see
Paragraphs 9.9, 9.10, and
9.20 of the Policy and
paragraphs
9.22, 9.23,
9.24, 9.25 and
9.30 of the Handbook of Procedures.
- DTA SALE ENTITLEMENT FOR EOU/EPZ UNITS :
Paragraphs 9.9 of the Export and Import Policy and 9.23 - 9.24 of the Handbook
of Procedures provide for sale in DTA by EOU/EPZ/EHTP/STP units. Such sales in the
DTA will be governed by the following guidelines:-
- The sale of goods in DTA will be subject to the payment of
applicable duties as notified from time to time by the Department of
Revenue, Ministry of Finance, Government of India.
- DTA sale entitlement will be applicable only to those goods and
services that are approved for manufacture and export in the Letter of
Permission/Letter of Intent. No DTA sale will be permissible if such
sale is specifically prohibited in the Exim Policy or the Letter of
Permission/Letter of Intent.
- Units may opt for DTA sales on a quarterly, half yearly or annual basis
by intimation to the Development Commissioner of the EPZ concerned.
- The DTA sales entitlement shall be availed of within three year of the
accrual of entitlement.
- An application for sale of goods, rejects, waste, scrap and remnants in
DTA as per para 9.9 and 9.20 of the Policy by the EOUs shall be
submitted to the Development commissioner of the EPZ concerned in the
form given at Annexure-A. The application shall be certified by an
independent Cost/Chartered /Cost and Works Accountant and endorsed by
the Bond Officer of Customs/Central Excise having jurisdiction over the
unit. The Development Commissioner of the EPZ concerned will
determine the extent of the DTA sale admissible and issue a goods
removal authorization in terms of value . An EPZ unit may effect sale in
DTA on the basis of records maintained by it with prior intimation to
Customs Authorities.
- DTA sale entitlement shall accrue only after the goods are physically
exported during the relevant period as indicated under sub-para (c)
above except as provided in sub-para (j) below. However, this requirement may
be waived in the case of such goods which, in the
opinion of the Development Commissioner of the EPZ concerned, require
trial production in order to produce goods of exportable quality.
- Advance DTA sale permission in respect of trial production shall not
exceed the entitlement accruable on the exports envisaged in the first
year and such sale shall be adjusted against the subsequent
entitlements. However, drugs and pharmaceuticals units can make advance
DTA sale of trial production on the exports envisaged in the first two
years adjustable against subsequent entitlements. The Unit shall be
required to execute a bond with the Assistant Commissioner
Customs/Central Excise concerned to cover the difference between the
amount of duties paid on the advance DTA sale and the full duties
applicable on such goods.
- Advance DTA sales permission would also be admissible in respect of
trial production in cases of capacity expansion/ product
diversification. In such cases, the unit would be entitled to advance
DTA sales linked to the expanded capacity created by establishment
of new production streams or installation of balancing equipment or
through product diversification . However, no advance DTA sale would be
admissible to a DTA unit converted into EOU except in respect of new
production stream or trial production as a result of change of
technology.
- The DTA sale entitlement would accrue if the NFEP achieved by the unit
is not less than the minimum stipulated level in the Appendix-I of the
Policy .
- EOUs engaged in the manufacture of perishable items like floriculture,
horticulture, pisciculture can also avail the facility of simultaneous
sale in DTA of such perishable items on quarterly basis, while earning
DTA entitlement on exports made during the said quarter. Such
permission can be granted in advance by the DC concerned subject to the
condition that the unit has achieved positive NFE upto the previous
quarter.
- DTA sale of instant tea will be allowed upto 20% of FOB value of exports in the form of tea bags or bulk
- SALE OF GEM & JEWELLERY PRODUCTS:
- DTA sale of Gem & Jewellery items will be permitted on annual basis by
the Development Commissioners upto 10% of FOB value of exports during
the preceding year subject to following conditions:
- The application will be submitted to DC of EPZ concerned on yearly basis
(licensing-year)giving the details of production and exports made during
the preceding licensing year duly certified by a Chartered Accountant
and endorsed by the jurisdictional Custom Authority. However an EPZ unit
may effect sale in DTA on the basis of records maintained by it with
prior intimation to Customs authorities.
- The DTA sale of plain jewellery shall be permitted on payment of
concessional rate of duty in Indian Rupees as applicable to sale from
nominated agencies. In respect of studded jewellery, duty shall be
payable in Indian Rupees as notified by Customs.
- OTHER SALES IN DTA:
The following guidelines shall apply to the sale of goods in the DTA in respect
of supplies specified in paragraph 9.10 of the Export and Import Policy and
paragraph 9.25 of the Handbook of procedures:
- The unit shall, at the time of application, indicate the quantity and
value of goods sought to be supplied in the DTA. If the sale is
effected against an import license held by the DTA purchaser, the
Customs/Central Excise Officer concerned will allow such sales after
making a suitable entry on the license of the quantity and value of such
sales permitted by the Development Commissioner. The Import license
shall cease to be valid for further imports to the extent of such
supplies effected by units.
- If, the goods proposed to be sold by the units do not require an import
license, the Customs/Central Excise Officer concerned will allow such
supplies from the unit to the DTA.
- Goods supplied under (a) and (b) above will be taken into account for
the purposes of discharging export obligation and achievement of NFEP.
The unit will file a quarterly statement to the Development Commissioner
giving details of the goods cleared in the DTA category wise.
- SALE OF REJECTS
Sale of rejects will be allowed in the DTA, as provided for in para 9.9(a) of
the Export and Import Policy and para 9.22 of the Handbook of Procedures.
- SALE OF BY-PRODUCTS:
The sale of by-products in the DTA may be allowed as per provision of para 9.9
of the Policy without inclusion of the item in LOP/LOI .
ANNEXURE - A
APPLICATION FOR DTA SALE PERMISSION
UNDER PARA 9.9(b) OF THE EXIM POLICY 1997-2000 FOR THE PERIOD
(QUARTERLY/HALF YEARLY/ANNUAL)
I. PROJECT DETAILS:
1. Name & Address of the unit:
2. LOI/LOP/IL No. & Date:
| 3. | Details of the products approved for manufacture and export in the LOP/LOI/IL | Items of manufacture/Services | Present Installed Capacity |
| | | 1.
2.
3. | : |
4. Date of commencement of production:
II DETAILS OF ADVANCE DTA SALE
| 5. | Details of the advance DTA sale permitted if any | Approval No. and Date | Particulars of products/Services Permitted | Value |
| 1) | | | | |
| 2) | | | | |
| 3) | | | | |
| Total | | | | |
DETAILS OF DISPATCH UNDER PARA 9.9 (a), (b), (h) and 9.20
| 6. | Details of advance DTA sale effected (Please indicate the period) | Description of goods/service sold in DTA as advance DTA sale Quantity | Value |
| 1) | | | |
| 2) | | | |
| 3) | | | |
| Total | | | |
III. PRODUCTION DETAILS FOR THE APPLICATION PERIOD
(a) Gross production
| I | Description of goods produced/Manufactured/services | Total Production Including Rejects and waste/scrap |
| | | Quantity | Ex-factory Value |
| | 1. | 2(i) | 2(ii) |
| 1) | | | |
| 2) | | | |
| Total | | | |
IV DETAILS OF PHYSICAL EXPORTS FOR THE APPLICATION PERIOD
| | FOB value of Physical Exports | value of rejected consignment,if any | Net FOB value of Physical Exports |
| | 5(ii) | 5(iii) | 5(iv)=[5(ii)-5(iii)] |
| 1) | | | |
| 2) | | | |
| 3) | | | |
| Total | | | |
V.NET FOREIGN EXCHANGE EARNINGS AS A PERCENTAGE OF EXPORTS(NFEP)
NFEP achieved on exports in the five years or less as applicable (calculation chart enclosed)
VI PARTICULARS OF PROPOSED DTA SALE
| Description of the items proposed to be sold in DTA | Value |
| 9(i) | 9(ii) |
| 1) | |
| 2) | |
| 3) | |
| Total | |
DECLARATION
I/We hereby declare that the information given above is true and correct
Signature of the applicant
Name
Designation
Seal of the Company
CHARTERED ACCOUNTANTS CERTIFICATE
We have checked and verified the figures mentioned above from the records and books of account of company
and found them true and correct
Signature
Name
Membership No
Seal
CERTIFICATE BY CENTRAL EXCISE AUTHORITY
Verified from the records and found correct by Inspector / Supdt. Of Central Excise & Customs I/C of the factory
Signature
Name
Seal
Note: Each page may be verified and signed by the Chartered Accountant
CALCULATION CHART (TO BE CERTIFIED BY A CHARTERED ACCOUNTANT SHOWING NFEP
ACHIEVED IN THE LAST FIVE YEARS OR LESS AS APPLICABLE
1. DETAILS OF PHYSICAL EXPORTS:
(Rs. in Lakhs)
| i) | F.O.B. value of physical exports made in the last five years or less as applicable | Rs. |
| ii) | Value of Supplies made under para 9.10 of the exim policy | Rs. |
| iii) | Total | Rs. |
2. DETAILS OF CAPITAL GOODS INCLUDING DG SET AND OTHER OFFICE EQUIPMENTS IMPORTED IN THE LAST FIVE YEARS OR LESS AS APPLICABLE
| (I) CIF VALUE OF IMPORTED CAPITAL GOODS (YEAR WISE) IN THE LAST FIVE
YEARS OR LESS AS APPLICABLE |
| Ist year | IInd year | IIIrd year | IVth year | Vth year | Total |
| | | | | | |
| (II)VALUE OF IMPORTED CG PROCURED FROM ANOTHER EOU/EPZ UNIT OR FROM A LEASING COMPANY
IN THE LAST FIVE YEARS OR LESS AS APPLICABLE |
| Ist year | IInd year | IIIrd year | IVth year | Vth year | VIth year |
| | | | | | |
| 3. | AMORTISED VALUE OF CAPITAL GOODS (Please see Note below for calculation) | Rs. |
| | | |
| 4. | DETAILS OF IMPORTED RAW MATERIAL | |
| (i) | Total CIF value of imported raw
materials, consumables including POL
products and components etc. in the
last five years or less applicable | Rs. |
| (ii) | Value of purchases made under Para
9.10(c), 9.16 of EXIM Policy in the
last five years or less applicable | Rs. |
| (iii) | Value of goods indicated at (i) &
(ii) above held in stock at the end
of the relevant period | Rs. |
| (iv) | Value of raw materials etc. used in
goods produced and cleared from the
unit {[(i) + (ii)]-[(iii)] | Rs. |
|
5. Total value of indigenous raw materials, consumables Rs..________________
components etc, used in goods produced and cleared from the unit in the last
five years or less as applicable
6. OTHER OUTFLOW OF FOREIGN EXCHANGE IN THE LAST FIVE YEARS OR LESS AS APPLICABLE
| (i) | Dividends | Rs. |
| (ii) | Profit | Rs. |
| (iii) | Technical know how fee | Rs. |
| (iv) | Royalty | Rs. |
| (v) | Commission | Rs. |
| (vi) | Foreign travel | Rs. |
| (vii) | Any other outflow in foreign
exchange(Please indicate details) | Rs. |
| Total | | Rs. |
7. NFEP achieved
A - B x 100
A
Where A = FOB value of exports
B = Sum total of value of imported inputs used. Proportionate (amortised) value
of imported capital goods, technical know-how fee and other expenses made in foreign exchange
Note: The proportionate (amortised) value of imported capital goods and technical know-how
fee shall be calculated @ 20% of the CIF value of each year in the last five years or
less as applicable.
(Please refer CUS CIR NO.38/2003 DATE 06/05/2003 for Stock Transfer by an EOUs to DTA, Whether Covered under DTA sale of the EXIM Policy - Clarification regarding)