DGFT Minutes

MINUTES OF THE POLICY RELAXATION COMMITTEE MEETING NO.02/AM06 HELD ON 22ND JUNE, 2005

The meet ing was held under t he Chairmanship of DG and t he list of of f icers present in t he meet ing is given in Annexure-I . The decision t aken in each individual case t aken up f or discussion by PRC is det ailed below:
Case No. 1 Firms Name M/s Nectar Lifesciences Ltd., Chandigarh File No. 01/83/171.AM05/DES-IV Subject: E.O. Extension.

The issue concerns request made by t he applicant f or ext ension of EO period in respect of Advance Licence No.0246288 dt.28.3.2001 beyond a period of 36 mont hs. The Commit t ee observed t hat Para 4.22.1 of t he Foreign Trade Policy 2004-09 provides f or ext ension beyond 36 months on the payment of composition fee @2% p.m. of the duty saved amount in proportion to the balance EO that remains to be fulfilled. It was, t heref ore, decided t hat t he RLA concerned should consider t he request of t he applicant in line wit h t he provisions of Para 4.22.1 of the Handbook of Procedures Vol.I 2004-09 updated as on 31.3.2005.
Case No. 2 Firms Name M/s National Organic Chemicals Indus. Ltd., Mumbai File No. 01/83/162/125/AM03/DES-IV Subject: Re-credit of DEPB for rejected goods.

The Commit t ee observed t hat t he case had already been cleared by t he PRC in it s meet ing held on 21.7.2003 f or re-credit of DEPB in respect of t he goods re-export ed against which t he said DEPB had been surrendered t owards payment of cust oms dut ies.

by t he PRC in it s meet ing held on 21.7.2003 f or re-credit of DEPB in respect of t he goods re-export ed against which t he said DEPB had been surrendered t owards payment of cust oms dut ies. I t was further observed t hat t his re-credit does not involve any revenue loss and t heref ore, t he concern expressed by t he Dept t of Revenue is not t enable. Since t he permission f or re-credit of DEPB credit against

2 t he subj ect DEPB has no revenue implicat ions as det ailed above, it was decided t hat t his re-credit may be allowed. That apart , t he DEPB in quest ion may be revalidat ed f or a period of 6 mont hs t o f acilit at e t he said DEPB t o be ut ilized by t he applicant . This revalidat ion of 6 mont hs period will be effective f rom t he dat e of endorsement of said revalidation on the DEPB.
Case No. 3 Firms Name M/s Vishnu Fabrics Pvt. Ltd., T.N. File No. 01/84/162/263/AM05/DES-IV Subject: Waiver of custom duty and penalty.

J DG(SBSR) inf ormed t he Commit t ee t hat t his case had earlier been considered by t he PRC. However, t he det ails t hereof were not available. Accordingly, it was decided that DES-IV Division would first f ind out t he det ails about t he earlier PRC decision in t he case and t he case be brought back bef ore t he Commit t ee wit h all relevant det ails for further view to be taken by the Committee.
Case No. 4 Firms Name M/s Ramsarup Engg. Indus. Ltd. File No. 01/81/162/922/AM05/DES-II Subject: Revalidation of Advance License.

ant det ails for further view to be taken by the Committee.
Case No. 4 Firms Name M/s Ramsarup Engg. Indus. Ltd. File No. 01/81/162/922/AM05/DES-II Subject: Revalidation of Advance License.

The Commit t ee observed t hat denial of f acilit y of import against t he advance licence where export obligat ion st ands f ulf illed amount s t o denial of t he benef it s of t he scheme t o t he export er, irrespect ive of t he f act t hat t he licence holder was not be able t o ut ilize t he licence wit hin t he init ial/ permissible limit of t he said licence.
I t was t heref ore, decided t hat t he licence in quest ion be revalidat ed f or a period of 6 mont hs and t his 6 mont h period will commence f rom t he date of such endorsement on the licence. However, it was also decided t hat t his revalidat ion may be permit t ed subj ect t o t he condit ion t hat penalt y amount equivalent t o 2% of t he un-ut ilized CI F value of t he licence may be imposed as f ee t owards such revalidat ion. I t was also

e permit t ed subj ect t o t he condit ion t hat penalt y amount equivalent t o 2% of t he un-ut ilized CI F value of t he licence may be imposed as f ee t owards such revalidat ion. I t was also

3 decided t hat Policy Division may work out modalit ies t o provide a provision in t he policy t hat allows availing benef it s of DFRC in such cases where export s have been complet ed and no import s have t aken place against an advance licence.
Case No. 5 Firms Name M/s V.V.F. Ltd. File No. 01/83/162/112/AM05/DES-V Subject: To allow partial physical E.O. through deemed export.

The Committee agreed to allow the balance EO to be f ulf illed in the instant case under Deemed Export supply t o 100% EOUs subj ect t o t he condit ion t hat in case CVD exempt ion has been availed f or such imports against the subject advance licence for physical exports and in case t he said CVD benef it s were not available in respect of Advance Licence f or Deemed export s at t hat part icular point of t ime, t he applicant will get the benefit of fulfillment of EO by supplying to 100% EOUs only af t er surrendering t he CVD exempt ion availed plus int erest thereof.
Case No. 6 Firms Name M/s Cosmo Films Ltd., New Delhi File No. 01/87/162/925/AM05/DES-VIII Subject: Extension in E.O. for Annual Advance License.

exempt ion availed plus int erest thereof.
Case No. 6 Firms Name M/s Cosmo Films Ltd., New Delhi File No. 01/87/162/925/AM05/DES-VIII Subject: Extension in E.O. for Annual Advance License.

The Commit t ee agreed t o allow ext ension in t he inst ant case f or regularizat ion purposes f or export s made beyond t he init ial export obligat ion period t o t he ext ent of 3.98% of short f all of EO subj ect t o t he condit ion t hat t hey pay t he composit ion f ee on t he CI F value in proport ion t o t he un-ut ilized quant it y @2% p.m. in respect of export s made beyond the initial EO period till the date of completion of EO.

4

Case No. 7 Firms Name M/s Amalgam Marine Harvests Ltd., Chennai File No. 01/36/218/227/AM02/EPCG-I Subject: Condonation of year-wise fulfillment of EO.

The Commit t ee observed t hat t he t ot al EO in t he inst ant case had been f ulf illed except t hat t he said applicat ion were not f ulf illed on year-wise basis t o t he ext ent of 10%, 20% & 30% in t he 2nd, 3rd & 4th year respect ively. I t was decided t o regularize t he mat t er and t reat the obligation f ulf illed even if t he same has been f ulf illed in t he 5th year in stead of maintaining the requirement of year-wise fulfillment.
Case No. 8 Firms Name M/s Choice Clothing Co. Pvt. Ltd., Gurgaon File No. 01/84/162/350/AM03/DES-V Subject: Extension in EO of Annual Advance License.

e requirement of year-wise fulfillment.
Case No. 8 Firms Name M/s Choice Clothing Co. Pvt. Ltd., Gurgaon File No. 01/84/162/350/AM03/DES-V Subject: Extension in EO of Annual Advance License.

The Commit t ee approved t o allow ext ension in EO period in t he inst ant case upt o 27.3.2005 f or regularizat ion purpose subj ect t o payment of applicable composit ion f ee as per Para 4.22.1 of t he current Handbook of Procedures Vol.I 2004-09 updated as on 31.3.2005.
Case No. 9 Firms Name M/s St. John Freight Systems Ltd., Tuticorin File No. 01/94/162/1391/AM05/PC-IV Subject: Revalidation of DFCE No. 3510011463 dt. 23.1.04.

This case had come up before the Committee earlier and was rejected.
A represent at ion in t his case has come f rom t he applicant against t he said rej ect ion and it has been pleaded t hat against t he DFCE t hey propose t o import equipment f or modernizat ion f or cont ainer freight st at ion at Tut icorin. The Commit t ee observed t hat since Tut icorin port was not operat ional and t heref ore t he plea put f ort h by t he applicant of not having been able t o ut ilize t he DFCE wit hin t he init ial

e Commit t ee observed t hat since Tut icorin port was not operat ional and t heref ore t he plea put f ort h by t he applicant of not having been able t o ut ilize t he DFCE wit hin t he init ial

5 validit y was justified. I t was also observed t hat t he policy now provides 24 mont hs validit y in respect of DFCE issued on or af t er 1.4.2004. Taking bot h t hese f act ors int o considerat ion, t he DFCE in t he inst ant case having been issued on 23.1.2004, it was decided t o allow revalidat ion in t he inst ant case f or a period of 6 mont hs and t his 6 mont hs period will commence f rom t he dat e of such endorsement of revalidation on the DFCE.
Case No. 10 Firms Name M/s K. Shoes Pvt. Ltd.,
File No. 01/92/180/AM05/PC.II Subject: Extension in the validity period of DTA Sale Permission

The Commit t ee observed t hat t his case had come up bef ore t he PRC on an earlier occasion wit h t he request f or seeking ext ension against t heir DTA Sales Ent it lement . On t he earlier occasion t hey had sought t he ext ension upt o 31.3.2005 and t he applicat ion t o t his ef f ect was made in J une/ August 2004. However, t he case had come up bef ore t he PRC on 14.1.2005 where t he ext ension was allowed upto 31.3.2005 and t he communicat ion t o t his ef f ect was sent t o t he applicant only on 4.2.2005 which provided it only 1 ½ mont hs period t o avail t he DTA Sale Ent it lement .
Taking t hese f act s int o considerat ion, it was decided to allow the period upto 31.12.2005 for DTA Sale.
Case No.

provided it only 1 ½ mont hs period t o avail t he DTA Sale Ent it lement .
Taking t hese f act s int o considerat ion, it was decided to allow the period upto 31.12.2005 for DTA Sale.
Case No. 11 Firms Name M/s Khanapur Taluka Co-Op Spinning Mills Ltd. File No. 01/92/180/66/AM05/PC.II Subject: Grant of DTA Sale Permission retrospectively

The Committee decided to reject the request of the applicant to grant ret rospect ive DTA Sale permission of balance ent it lement proposed t o be adj ust ed against DTA Sale already made wit hout DTA Sale permission.

6 Case No. 12 Firms Name M/s Ralco Exports. Ludhiana File No. 01/83/50/191/AM04/DES-IV Subject: Endorsement of Natural Rubber on Adv. Lic.

This case had come up bef ore t he Commit t ee earlier on and was rejected on the grounds that the applicant had not claimed the benefit of import of natural rubber in the original application submitted by the applicant . However, it was brought t o t he not ice of t he Commit t ee t hat t he f act of t he mat t er was cont rary t o t his and in t he original applicat ion t hey had act ually ment ioned requirement of nat ural rubber as an input but had not specif ied t he CI F et c. against t he same as t he policy did not provide import of nat ural rubber at t hat point of t ime.
Subsequent t o t his Policy Circular No.17 dt .10.2.2003 was issued which permit s endorsement of nat ural rubber on licence in such cases where applicant had init ially ment ioned t his in t he original applicat ion.

Policy Circular No.17 dt .10.2.2003 was issued which permit s endorsement of nat ural rubber on licence in such cases where applicant had init ially ment ioned t his in t he original applicat ion. The Commit t ee t heref ore opined t hat t here is no need t o relax t he policy in t he inst ant case and RLA should endorse t he nat ural rubber entitlement in the licence as per Policy Circular No.17 dt.10.2.2003. It was f urt her decided t o allow t he revalidat ion f or a period of 6 mont hs in t he inst ant case t o f acilit at e such import s by t he licence holder.
This 6 mont hs period will commence f rom t he dat e the said endorsement is made on the licence.
Case No. 13 Firms Name M/s EPSON India Pvt. Ltd. File No. 01/80/162/1565/AM05/DES.I Subject: Revalidation of DEPB Lic.

The Commit t ee t aking int o account t he humanit arian aspect agreed t o the revalidation of the DEPB licence in the instant case for a period of 4 mont hs and t his 4 mont hs period will commence f rom t he dat e of said endorsement is made on the DEPB Credit Certificate.
Case No. 14

the DEPB licence in the instant case for a period of 4 mont hs and t his 4 mont hs period will commence f rom t he dat e of said endorsement is made on the DEPB Credit Certificate.
Case No. 14

7 Firms Name M/s EMCO Ltd.,
File No. 01/80/163/ 3 /AM06/DES.I Subject: Revalidation and Extension in E.O. period

From t he det ails present ed bef ore t he Commit t ee in t he Agenda, it was seen t hat t hey had ut ilized t he licence t o t he ext ent of US$ 2196125 and had f ulf illed t he Export Obligat ion on pro-rata basis.
Theref ore, t here is no reason f or allowing bot h revalidat ion and EO ext ension t o f acilit at e f urt her import s and export s in t he inst ant case particularly when the validity of the licence has expired as also the EO period t hereof . I t was decided t hat t he case be closed under t he policy after working out t he pro-rata EO and in case t he export er int ends t o make f urt her import and export t hey are f ree t o make a fresh application for a new licence.
Case No. 15 Firms Name M/s Apar Indus. Ltd., File No. 01/80/162/1626/AM05/DES.I Subject: Revalidation and Extension in E.O. period

The case was wit hdrawn by DES-I Division as t he validit y of t he licence and EO period f or supply of Turnkey Proj ect s is co-terminus with t he validit y of t he dur at ion of t he cont ract ed proj ect as per Para 4.15(a) of Handbook of Procedures 1997-2002 read with Para 4.22.1 of t he Handbook of Procedures Vol.I 2004-09 updat ed as on 31.3.2005.

of t he dur at ion of t he cont ract ed proj ect as per Para 4.15(a) of Handbook of Procedures 1997-2002 read with Para 4.22.1 of t he Handbook of Procedures Vol.I 2004-09 updat ed as on 31.3.2005.
The issue may be decided by t he concerned division on f ile in line wit h the existing policy.

8

Case No. 16 Firms Name M/s Apar Indus. Ltd., File No. 01/80/162/1627/AM05/DES.I Subject: Revalidation and Extension in E.O. period

The case was wit hdrawn by DES-I Division as t he validit y of t he licence and EO period f or supply of Turnkey Proj ect s is co-terminus wit h t he validit y of t he dur at ion of t he cont ract ed proj ect as per Para 4.15(a) of Handbook of Procedures 1997-2002 read with Para 4.22.1 of t he Handbook of Procedures Vol.I 2004-09 updat ed as on 31.3.2005.
The issue may be decided by t he concerned division on f ile in line wit h the existing policy.
Case No. 17 Firms Name M/ s Marsons Elect rical I ndus. File No. 01/80/162/1471/AM05/DES.I Subject: Extension in EOP for Special Imprest License

The Commit t ee t ook not e of t he ground realit ies in t his case and observed t hat Grid Corporat ion of Orissa to whom supply of transformers is required t o be made is st ill not doing well and therefore deemed export supply in t he inst ant case has got delayed and order cancelled subsequent ly.

Orissa to whom supply of transformers is required t o be made is st ill not doing well and therefore deemed export supply in t he inst ant case has got delayed and order cancelled subsequent ly. I t was decided t o ext end t he EO period in t he inst ant case by a period of 6 mont hs which shall commence f rom t he dat e of endorsement of such EO ext ension and t his balance EO wit hin t his ext ended period of 6 mont hs will be f ulf illed by direct physical export s as request ed by t he applicant .
Taking int o considerat ion t he f act s of t he case, it was also decided that no composition fee shall be charged in this case for EO extension.

9

Case No. 18 Firms Name M/s Kirloskar Ebara Pumps Ltd. File No. 01/80/162/833/AM05/DES.I Subject: Extension in Export Obligation period

The case was wit hdrawn by DES-I Division as t he validit y of t he licence and EO period f or supply of Turnkey Proj ect s is co-terminus wit h t he validity of the duration of the contracted project as per Para 4.15(a) of Handbook of Procedures 1997-2002 read with Para 4.22.1 of t he Handbook of Procedures Vol.I 2004-09 updat ed as on 31.3.2005.
The issue may be decided by t he concerned division on f ile in line wit h the existing policy.
Case No. 19 Firms Name M/s Bajaj Tempo Ltd. File No.

s Vol.I 2004-09 updat ed as on 31.3.2005.
The issue may be decided by t he concerned division on f ile in line wit h the existing policy.
Case No. 19 Firms Name M/s Bajaj Tempo Ltd. File No. 01/80/162/772/AM05/DES.I Subject: Extension in Export Obligation period

The case was wit hdrawn by DES-I Division as t he validit y of t he licence and EO period f or supply of Turnkey Proj ect s is co-terminus wit h t he validit y of t he dur at ion of t he cont ract ed proj ect as per Para 4.15(a) of Handbook of Procedures 1997-2002 read with Para 4.22.1 of t he Handbook of Procedures Vol.I 2004-09 updat ed as on 31.3.2005.
The issue may be decided by t he concerned division on f ile in line wit h the existing policy.
Case No. 20 Firms Name M/s Piem Hotels Ltd. File No. 01/94/180/87/AM06/PC.I Subject: Disposal of TVs imported under EPCG

The Commit t ee agreed t o t he request made by t he applicant in t he inst ant case and decided t o permit t he applicant t o dispose of f / sell 70 Nos. of import ed 21 Philips TVs, import ed under EPCG licence

agreed t o t he request made by t he applicant in t he inst ant case and decided t o permit t he applicant t o dispose of f / sell 70 Nos. of import ed 21 Philips TVs, import ed under EPCG licence

10 wit hout wait ing f or t he complet ion of 5 years period in November 2005 as laid down in para 5.7.6 of t he Handbook of Procedures Vol.I 2004-09 updated as on 31.3.2005.
Case No. 21 Firms Name M/s ALA Chemicals Pvt. Ltd. File No. 01/83/50/972/AM03/DES.IV Subject: Revalidation of Adv. Lic.

The Commit t ee observed t hat denial of f acilit y of import against t he advance licence where export obligat ion st ands f ulf illed amount s t o denial of t he benef it s of t he scheme t o t he export er. The licence holder was not able t o ut ilize t he licence wit hin t he init ial/ permissible limit of t he said licence. I t was t heref ore, decided t hat t he licence in quest ion be revalidat ed f or a period of 6 mont hs and t his 6 mont h period will commence f rom t he dat e of such endorsement on t he licence. However, it was also decided t hat t his revalidat ion may be permit t ed subj ect t o t he condit ion t hat penalt y amount equivalent t o 2% of t he un-ut ilized CI F value of t he licence may be imposed as f ee towards such revalidation.
Case No. 22 Firms Name M/s Savio Texcone (P) Ltd. File No. 01/87/162/907/AM04/DES-VIII Subject: Grant of Duplicate Special Imprest Lic.

e may be imposed as f ee towards such revalidation.
Case No. 22 Firms Name M/s Savio Texcone (P) Ltd. File No. 01/87/162/907/AM04/DES-VIII Subject: Grant of Duplicate Special Imprest Lic.

I t was brought t o t he not ice of t he Commit t ee t hat basically t he applicant had submit t ed t he licence t o t he RLA concerned f or seeking revalidat ion which on t he cont rary was accept ed by t he RLA as unut ilized licence surrendered by t he applicant f or cancellat ion. I t was t heref ore decided t he a duplicat e licence f or t he unut ilized value may be issued in t he inst ant case and t he validit y of t his be ext ended by a period of 6 mont hs subj ect t o payment of penalt y equivalent t o 2% of the unutilized value of the licence as revalidation fee.

11 Case No. 23 Firms Name M/s Brahma Steyr Tractors Ltd. File No. 01/53/8/809/B-21 / AM01 /ILS Subject: Revalidation of Import License

On perusal of the agenda papers, it was seen that the complete details about this case have not been reflected in the Agenda. It was decided t hat a complet e agenda not e giving f act ual posit ion of t he case be put up. This should be put up alongwit h t he st at us f rom t he Cust oms as t o why t her e was a delay of more t han a year f or accept ing t he Bills of Entry, etc. as the same is stated to have been filed on 5.5.2003.
Case No. 24 Firms Name M/s Manor Hotels Pvt. Ltd. File No. 01/93/180/384/AM06/PC-I(B) Subject: Waiver of Homologat ion condit ion f or import of BMW Car.

ted to have been filed on 5.5.2003.
Case No. 24 Firms Name M/s Manor Hotels Pvt. Ltd. File No. 01/93/180/384/AM06/PC-I(B) Subject: Waiver of Homologat ion condit ion f or import of BMW Car.

The Commit t ee agreed t o relax policy t o allow exempt ion f rom homologat ion procedure subj ect t o t he condit ion t hat t he CIF value of t he car import ed is in excess of US$ 40000 and Engine capacit y is 3000 C.C. & above.
The meeting ended with vote of thanks to the Chair.

---

Annexure-I

LIST OF PARTICIPANTS

Shri Surat Singh, Addl. DGFT 2. Shri S.K.Prasad, Addl. DGFT 3. Shri Vipin Saxena, EC 4. Shri Anil Bamba, Jt. DGFT 5. Shri A.K.Singh, Jt. DGFT 6. Shri P.C.Tripathi, Jt. DGFT 7. Shri S.B.S. Reddy, Jt. DGFT 8. Shri Raj Kamal, Jt. DGFT 9. Ms. K. Chandramathi, Jt.DGFT 10. Shri Anil Aggarwal, Jt. DGFT 11. Shri P.K.Santra, Dy. DGFT 12. Smt. Kiran Sehgal, Dy. DGFT 13. Shri H.C. Azad, Dy.DGFT 14. Shri M.K.Parimoo, Dy.DGFT