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DGFT Notification, Circulars... Trade Notices TRADE NOTICE NO. 06/1999, DATE 06/08/1999

A new scheme of Annual Advance Licence (A.L.L.) has been notified in the Exim Policy (RE-99) 97-2002. The scheme has come into operation from 1.7.1999. The details of the scheme have already been notified under paragraph 7.4A of the Exim Policy and para 7.54 of the Handbook of Procedure (Vol. I) (Refer Public Notice No.10/97-2002 dated 7.6.99).


The following categories of exporters are eligible for Annual Advance Licence (AAL).

i) Manufacturer exporter with export performance of Rs.1 crore in the preceding year and registered with Excise authorities except for products, which are not excisable for which no registration is required.

ii) Export House, Trading House, Star Trading House and Super Star Trading Houses holding certificates as merchant exporter who are ready to furnish names of supporting manufacturers along with their registration certificates. A copy either of his own manufacturing registration or of his supporting manufacturer in support of his claim shall be required.

In case of excisable product a copy of excise registration certificate of exporter/supporting manufacturer will be required.

iii) The Head office/Registered office of a company can apply for AAL giving full address of the factory/supporting manufacturer where the inputs shall be used in the resultant products an AAL can also be filed to the licensing authority under whose jurisdiction the manufacturing unit is located.


i) Eligible applicants are entitled for AAL upto 125% of the average FOB value of exports in the preceding three licensing years.

ii) One AAL for one export product group shall be issued.

iii) Each AAL shall have one Port of Registration for imports. Exports can take place from any port mentioned in para 7.19 of Handbook of Procedures.

iv) The applicant is entitled to import any input covered under SIO Norms as given in Handbook of Procedures (Vol. I) in respect of export of any product in the product group for which the AAL shall be issued. In addition, he will be eligible to import packaging materials as per SIO norms/general policy for packaging materials given in Handbook of Procedures (Vol. I).

v) The applicant can also procure the materials indigenously through ARO, for which he has to furnish quantity of material, relevant technical characteristics and value and irrevocable option in writing for using the specific indigenous inputs. Once the endorsement of using specific indigenous inputs is allowed against AAL, no amendment thereon shall be allowed.

vi) Imports under Annual Advance Licence shall be exempted from basic customs duty including surcharge, additional customs duty, special additional duty, anti dumping duty and safeguard duty. Since the inputs are exempted from additional customs duty, the applicant is not entitled for the benefit under Rule 12(1)(b) or Rule 13(1)(b) of Central Excise Rules, 1944 in respect of exports made under Annual Advance Licence.

vii) No exports shall be allowed under AAL unless the applicant mentions the specific AAL number and date in the shipping bill.

viii) Exporters who have already availed the benefit of advance licensing for production programme scheme up to 30th June, 1999, shall be required to give the details of production programme licence obtained and their entitlement shall be reduced to that extent while issuing the Annual Advance Licence (AAL) for the remaining period.


No drawback shall be allowed under Annual Advance Licence to exporter except for cases where the applicant for Annual Advance Licence wants to use indigenous inputs and give and irrevocable option in writing for using the specific indigenous inputs. The licensing authority shall make an endorsement in the licence stating that "the licence holder shall not import _________ (specify the indigenous inputs) under this Annual Advance Licence". To enable the applicant to claim drawback as per Drawback Rules no amendments to this endorsement shall be allowed after issuance of the licence.


The Annual Advance Licence is valid for 12 (twelve) months for imports and 18 (eighteen) months for exports from the date of issue. A specific endorsement shall be made by the licensing authority stating that "this licence shall be presented before the licensing authority for giving full account of the inputs in product exported as per Standard Input Output Norms before the expiry of 20 months from the date of issue of the licence. Before expiry of this period, the licence holder shall furnish proof of having fulfilled export obligation by submitting the documents as prescribed in paragraph 7.25 of the Handbook of Procedures (Vol. I). In case of bona fide default, the licence holder can apply for regularisation in terms of paragraph 7.28 of the Handbook of Procedures (Vol. I).


i) Application in the prescribed format with application fee as applicable.

ii) Valid RCMC, IEC, Profile.

iii) In case of Status Holder :
self-attested copies of valid status certificate copies of registration certificates of manufacturing units where the exempt materials are to be used for export production in case of merchant status holder, complete details of supporting manufacturers and their registration certificates with consent letters should be submitted.

iv) In case of manufacturer exporter :
C.A. Certificate regarding average export turnover more than Rs.1 crore in the preceding three licensing years as per App.26 of Handbook of Procedures Registration Certificate with Central Excise

v) In case of export of non-excisable product :
a certificate from the excise authority to the effect that the product is non- excisable and that as such no excise registration is required. Registration Certificate of the manufacturing units (SSI registration /IEM etc.) concerned

vi) A statement of export products proposed to be exported with a total fob covered under one product group and the total cif value of imports.




1. This licence is issued in terms of para 7.4a of export and import policy and para 7.54 of handbook of procedures 1997-2002 as amended from time to time.

2. Licence shall be valid for 12 months for imports and 18 months for exports from the date of its issuance.

3. Exports and imports shall be subject to export import policy in force.

4. The exempted goods imported against this licence shall only be utilised in Accordance with the provisions of export import policy 1997-2002 and custom Notification no. 48/99 dt. 29.4.99 as amended from time to time. The licence and/or Material imported under this licence shall not be transferable even after completion Of export obligation.

5. The licencee shall maintain the nexus between imported inputs and the resultant Product as per sio norms.

6. The licence is subject to all general conditions as applicable and as laid down In the handbook of procedures, 1997-2002, vol.ii (standard input output norms book).

7. The licencee, at the time of imports, shall furnish the details of inputs, Including its specifications and relevant technical characteristics (such as Grades/denier/g.s.m/purity/marks and numbers/active ingredient contents e.t.c) to the Custom authorities for making entries in the deec (import) at the time of exports Technical characteristics shall be declared to establish nexus and entries will be Made accrodingly in the deec (export).

8. The licencee shall maintain a true and proper account of consumption and Utilisation of goods imported against this licence.

9. The licencee is not entitled for the benefit under rule 12(1)b or rule 13(1)(b) Of central excise rules 1984 in respect of exports made under this licence.

10. The licence holder shall not be eligible for drawback against exports made Under this licence unless the input/inputs are procured indigenously.

11. The foreign exchange remittance and realisation against this licence will be Governed by the guidelines issued by the reserve bank of india from time to time.

12. The foreign exchange realisation obligation shall also be governed by the Provisions of the exim policy and handbook of procedures prevalent on the relevant date.

13. This licence shall be presented before the licensing authority for giving full Account of the inputs in product exported as per sion before expiry of twenty months From the date of issue of the licence. Simultaneously, the licence holder shall Furnish proof of having fulfilled the export obligation by submitting the documents as Prescribed in para 7.25 of handbook of procedures, vol. I.

14. If a licence holder fails to discharge the prescribed export obligation and Does not apply for regularisation of bona fide default within the permitted time, the Licensing authority shall initiate action against licence holder as per provisions of The foreign trade (development and regulation) act 1992 as amended from time to time.

15. Necessary bond/bg is to be executed with the customs authorities as per the relevant customs notification before first importation.

16. The licence holder is entitled to import any inputs covered under standard input output norms as given in vol. Ii in respect of the export product falling under the product group specified in the licence in addition, the licence holder can import packing material required for packing of the export product which shall be accounted for, as per sio norms. Where packing materials are not covered under sio norms, the same shall be accounted for as per general policy for packing materials in handbook of procedures, 1997-2002.


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