DGFT Minutes

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Minutes of the Policy Relaxation Committee Meeting held under the Chairmanship of DGFT, Shri Anup Wadhawan, IAS on 05.10.2015 Meeting No. 09/AM16 held on 05.10.2015 at 11:30 AM.

List of officers present in the meeting is given below:

Shri D. K. Singh

Addl. DGFT 2. Shri L.B. Singhal

Addl. DGFT 3. Shri K.C. Rout Addl. DGFT 4. Shri Jaikant Singh
Addl. DGFT 5. Shri Darshan Singh

Jt. DGFT 6. Shri S.K.Samal

Jt. DGFT 7. Shri Jay Karan Singh

Jt. DGFT 8. Shri S.P. Roy

Jt. DGFT 9. Dr. S.K. Bansal Jt. DGFT 10. Shri S.K. Mohapatra

Dy. DGFT 11. Smt Nivedita Roy Choudhury FTDO

Following cases were discussed. The decision taken on the individual cases are as under:-

Case No. 1: M/s. Sona Biscuits Ltd., Kolkata.

F.No. 01/60/162/563/AM15/ EFGC (PRC) PRC Meeting No. 09/AM16 dated 05.10.2015

Subject: - Request for Revalidation of DFIA No. 0210187046 dt.04.03.2013

Decision:

The Committee noted that endorsement of transferability/waiver of bond is a facility available with DFIA scheme. It does not prevent the Authorisation holder from importing of goods within the validity of the DFIA. The applicant should have imported goods within its initial as well as extended validity granted by RA. The total period of imports available was 18 months from the date of issue of Authorisation. Since, there was no delay in transmission of data, as per EDI report and RA has allowed one revalidation for six months, the Committee did not accede to the request for further revalidation.

Case No. 2: M/s. Sona Biscuits Ltd., Kolkata.

F.No. 01/60/162/562/AM15/ EFGC(PRC)

Subject: - Request for Revalidation of DFIA No. 0210187050 dt.04.03.2013

Decision:

The Committee noted that endorsement of transferability/waiver of bond is a facility available with DFIA scheme. It does not prevent the Authorisation holder from importing of goods within the validity of the DFIA. The applicant should have imported goods within its initial as well as extended validity granted by RA. The total period of imports available was 18 months from the date of issue of Authorisation Since, there was no delay in transmission of data, as per EDI

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report and RA has allowed one revalidation for six months, the Committee did not accede to the request for further revalidation.

Case No. 3: M/s. Mittal Pigments Pvt. Ltd., Kota (Raj.).

F.No. 01/60/162/30/AM16/ EFGC(PRC)

Subject: - Request for Revalidation of DFIA No. 1310040014 dt.13.06.2012

Decision:

The Committee noted that the applicant had mistakenly opted wrong port of registration i.e. Kota Revtha Road ICD (INRDT6), which was non operative, while submitting online application for DFIA. Taking into consideration the fact that imports cannot me made from “Kota Ravtha Road ICD (INRDT6)” as opted and DFIA issued, the committee decided the following: (i) RA shall issue manually a fresh DFIA having validity of 6 months after cancellation of old DFIA . (ii) Port of registration shall be the port from which shipments were affected. (iii) An endorsement on the face of DFIA shall be made by RA that Customs shall verify the genuineness of shipments against which DFIA is issued before clearance of imported goods.

(Action: RA, Kota)

Case No. 4: M/s. Mauria Udyog Ltd., New Delhi.

F.No. 01/60/162/178/AM16/ EFGC(PRC)

Subject: - Request for Revalidation of DFIA No. 0510329173 dt.10.07.2012

Decision:

The Committee observed that the applicant has already been granted one revalidation for six months by the Regional Authority. Despite the fact that the applicant had a total validity period of 26 months, including the extended validity, to complete its imports, the applicant has failed to utilize the Authorization. The Authorisation was valid for a month even after endorsement of transferability. Therefore, the Committee did not accede to the request.

Case No.5:M/s. Polynova Industries Ltd., Mumbai.

F.No. 01/60/162/146/AM16/ EFGC (PRC)

Subject: - Request for revalidation of Advance Authorization No. 0310675923 dated

11.01.2012

Decision:

The Committee observed that the since the Authorisation had been issued on 11.01.2012, hence the original validity period available with the applicant was 24

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months and the Regional Authority had extended the validity period by 6 months, thus, the total validity period available with the applicant was 30 months which was sufficient to affect their imports. The applicant has already completed 100% imports against 4 items out of 7 items permitted in the Authorisation. Further, the Authorisation has already been redeemed. Hence, the Committee did not find any merit in the case for granting further revalidation.

Case No.6: M/s. Polynova Industries Ltd., Mumbai.

F.No. 01/60/162/147/AM16/ EFGC(PRC)

Subject: - Request for revalidation of Advance Authorization No. 0310702273 dated

18.07.2012

Decision:

The Committee observed that the RA has already allowed one revalidation for six months and the applicant had completed imports almost 100% against 4 items out of 7 items permitted for imports in the Authorisation. No cogent reason have been given for not importing goods against remaining 3 items within its extended validity. The Authorisation has already been redeemed. Hence, the Committee did not accede to the request.

Case No.7: M/s. BalmerLawrie – Van Leer Ltd., Mumbai.

F.No. 01/60/162/129/AM16/ EFGC(PRC)

Subject: - Request for revalidation of Advance Authorization No. 0310705054 dated

13.08.2012

Decision:

The Committee observed that the applicant has already been granted one revalidation for six months by RA and the applicant has completed 100% imports against one item leaving only 2.64% against second item. So the applicant should had imported balance goods too within the validity period. An entity is placed under DEL if it fails to complete the stipulated export obligation and/or in submitting the prescribed documents towards discharge of export obligation. It is an action for the failure on the part of the Authorisation holder to deny further benefits until compliance is made. Therefore onus of such failure cannot be shifted on others. The Committee, therefore, did not accede to the request.

Case No.8: M/s. Emcure Pharmaceuticals Ltd., Pune

F.No. 01/60/162/898/AM14/ EFGC(PRC)

Subject: - Request for deletion of applicability of Policy Circular No. 9 dt.30.6.2003

against 7 Advance Authorizations (1) No.3110039723 dt.26.08.2009, (2) No 3110044134 dt. 29.07.2010, (3) No 3110045645 dt. 26.11.2010, (4) No 3110052462 dt. 17.01.2012, (5) No 3110054408 dt. 22.05.2012, (6) No 3110056925 dt. 24.01.2013

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and (7) No 3110063481 dt. 11.04.2014 for registration condition being Indian Origin drug OR allow EOP extension and grant waiver from the destruction and consumption certificate for regularization purpose.

Decision:

The case was discussed in the PRC meeting No 07/AM16 dated 13.08.2015 and was deferred for seeking status of export obligation completion report against each Authorisation from the applicant. Now the applicant has submitted statement of E.O. for each Authorisation. On perusal of said statement, it was observed that except against Authorization No. 3110039723 dt. 26.08.2009, export obligation period was 12 months from the date of import of first consignment and the applicant has exported also within 12 months only. However, Authorisation No. 3110039723 dt. 26.08.2009 was issued prior to PN 2 dated 27.08.2009 which allows 6 months obligation period for exports from import of first consignment. The date of first import was 31.12.2009 under the said Authorisation and accordingly the export obligation period was upto 30.06.2010. The firm has fulfilled more than 50% of its stipulated export during the initial export obligation period against the said Authorisation.

cordingly the export obligation period was upto 30.06.2010. The firm has fulfilled more than 50% of its stipulated export during the initial export obligation period against the said Authorisation. Taking all these facts into consideration, the Committee decided the following:

I. No extension in EOP is required against Authorisations appearing at Sl No 2 to 7 above. II. Export obligation period be extended by six months i.e. upto 31.12.2010 from the date of first import consignment in the Advance Authorization No. 3110039723 dt. 26.08.2009. III. This is subject to payment of a composition fee @ 0.5% of FOB value of exports made after initial obligation period. IV. The applicant has to pay duty plus interest on inputs consumed and exported after 12 months from the date of first import against Authorization No. 3110039723 dated. 26.08.2009. V. This is only for accounting and regularization of exports already effected. VI. The minimum value addition of 15% as prescribed under Para 4.09 of FTP (2015-2020) shall be maintained. VII. The applicant has paid customs duty with interest on excess import of 45.52kgs unaccounted raw materials imported against remaining 6 Authorisations. Hence, PC-18 condition stands waived to the extent of requirement of destruction certificate/re-export against all seven Advance Authorisations mentioned above.

(Action: RA, Pune)

Case No.9: M/s. Sapphire Lifesciences Pvt. Ltd., Mumbai.

F.No. 01/60/162/77/AM16/ EFGC(PRC)

Subject: - Request for:

(i) Grant of one E.O. extension of six months from the date of expiry of the initial E.O. period against A.A. No.0310129684 dt. 19.03.2002 and
(ii) Consideration of 2 Shipping Bills No.5189497 dt. 29.11.2003 & 2549569 dt. 21.01.2004 which is wrongly exported by mentioning other AA No.0310210775

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dt.27.06.2003 (against which they have already obtained EODC from RA) towards fulfillment of E.O. under this AA.

Decision:

The case was discussed in the PRC meeting No 07/AM16 dated 13.08.2015 and was deferred for seeking report from RA, Mumbai. On perusal of RA report and submissions made by the applicant, it was observed that the RA has allowed one extension for six months, as per the prevalent procedure i.e. upto 30.09.2003. The applicant has fulfilled 70.10% exports within initial obligation period and remaining 38.74% against two shipping bills quoting different Advance Authorisation No which has already been redeemed without taking into account the said two shipments. The Committee, therefore, decided the following:

I. Export obligation period be extended by six months i.e. upto 31.03.2004 against the Advance Authorization No. 0310129684 dt. 19.03.2002.
II. This is only for accounting and regularization of exports already effected. III. This is subject to payment of a composition fee @ 0.5% of FOB value of exports made after initial obligation period. IV. The minimum value addition of 15% as prescribed under Para 4.09 of FTP (2015-2020) shall be maintained. V. Shipping Bill Nos. 5189497 dt.

ue of exports made after initial obligation period. IV. The minimum value addition of 15% as prescribed under Para 4.09 of FTP (2015-2020) shall be maintained. V. Shipping Bill Nos. 5189497 dt. 29.11.2003 & 2549569 dt. 21.01.2004, where exports are affected by mentioning Advance Authorization No. 0310210775 dt.27.06.2003, be allowed to be accounted against the Authorization No. 0310129684 dt. 19.03.2002 subject to payment of Rs.200/- per Shipping bill. VI. RA shall ensure that shipments which are accounted in the Authorization No. 0310129684 dt. 19.03.2002 has not been accounted for and / or shall not be accounted for under any other Authorization for redemption purpose.

(Action: RA, Mumbai)

Case No.10: M/s. Bulkpack Exports Ltd., Indore.

F.No. 01/60/162/169/AM16/ EFGC(PRC)

Subject: - Request for revalidation of Advance Authorization No. 5610001781 dated

04.03.2013.

Decision:

The Committee observed that the applicant has already been granted one revalidation for six months by RA. Despite that the applicant could not utilize the Authorization. Therefore, the Committee did not accede to the request.

Case No.11: M/s. Vivimed Labs Ltd., Hyderabad.

F.No. 01/60/162/175/AM16/ EFGC(PRC)

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Subject: - Request for Clubbing of 4 Advance Authorizations No. 0910039305

dt.16.09.2009; 0910039512 dt. 08.10.2009; 0910045816 dt. 07.03.2011; and 0910050211 dt.14.12.2011.

Decision:

The Committee noted that all Authorisations proposed to be clubbed have been issued within 36 months period from the Advance Authorization No.
0910039305 dt.16.09.2009. Hence, the Committee decided the following:

I. Export obligation period against Authorisation No. 0910039305 dt.16.09.2009 be extended upto 48 months i.e. upto 30.09.2013.
II. Clubbing of the all 4 Advance Authorisations be allowed. However, exports effected upto 30.09.2013 shall only be accounted for. III. This is only for accounting and regularization of exports already effected. IV. The applicant has to pay a composition fee @ 0.5% of FOB value of exports made after 36th months but upto 42nd months i.e. upto 30/03/2013 and @ 0.5% per month of FOB value of exports made after 42nd months and up to 48th months i.e. upto 30/09/2013.
V. The minimum value addition of 15% as prescribed under Para 4.09 of FTP (2015-2020) shall be maintained. VI. The applicant has to pay customs duty plus interest on inputs consumed and exported after 48 months i.e. after 30.09.2013. (Action: RA, Hyderabad)

Case No.12: M/s. Shree Ambica Industries P. Ltd., Surat.

F.No. 01/60/162/143/AM16/ EFGC(PRC)

Subject: - Request for revalidation of Two Advance Authorizations No. 5210039243

dt. 06.12.2012 & 5210039545 dt.12.03.2013.

Decision:

The Committee noted that the justification given by the applicant expressing inability to complete their imports within the initial as well as the extended validity granted by the RA, due to fluctuation of exchange rate and high cost of imported goods, cannot be construed as genuine hardship, as the applicant had option to procure the goods without payment of duties from domestic market. Hence, the Committee did not accede to the request.

Case No.13: M/s. Kairav Chemofarbe Industries Ltd., Mumbai..

F.No. 01/60/162/254/AM16/ EFGC(PRC)

Subject: - Request for revalidation of Two Advance Authorizations No. 0310724053

dt. 14.02.2013 & 0310724054 dt.14.02.2013.

Decision:

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The Committee noted the submissions of the applicant that they could not complete balance imports due to blockage of excise duty while procuring the goods from M/s Reliance Industry could not construed as a case of genuine hardship. The applicant had the option to procure the goods from other domestic suppliers or import the same from overseas suppliers. Further, RA has already allowed one revalidation for six months in both the Authorisations. Hence, the Committee did not find any merit in the case for grant of further revalidation.

Case No.14: M/s. Mauria Udyog Ltd., New Delhi.

F.No. 01/60/162/56/AM16/ EFGC(PRC)

Subject: - Request for Revalidation of DFIA No. 0510329700 dt.13.07.2012.

Decision:

The Committee noted that the RA has already allowed one revalidation for six months. The applicant has not furnished any valid reasons for not affecting imports of 3 items though he has completed imports against two items during the initial / extended validity period. Hence, the Committee did not find any merit in the case for grant of further revalidation. Thus, the committee rejected the request.

Case No.15: M/s. BRG Iron & Steel Company Pvt. Ltd., Kolkata.

F.No. 01/60/162/604/AM14/ EFGC(PRC)

Subject: - Request of enhancement of export fulfillment period against 3 Advance

Authorizations (i) No.0210151402 dt. 01.12.2010, (ii) No 0210151745 dt. 08.12.2010 & (iii) No 0210152625 dt.24.12.2010.

Decision:

The Committee observed that the applicant has fulfilled only 24.61%, 0.0% and 4.39% export obligation against Advance Authorizations No.0210151402 dt. 01.12.2010, No.0210151745 dt. 08.12.2010 and No. 0210152625 dt.24.12.2010 respectively within initial 36 months obligation period. Further, the DRI, Delhi Zonal Unit, vide letter dated 01.06.2015 has informed that M/s BRG Iron & Steel Company Pvt. Ltd., Kolkata has imported duty free goods and consumed fully the said goods for manufacturing the semi- finished and finished goods but no records have been given by the company to substantiate their claim that materials lying in their stock pertaining to 3 Advance Authorisations. After investigating the case in details, DRI has concluded that goods imported against three Advance Authorisation were not in the possession of the company. Hence, DRI recommended not to allow further extension in the case. As the committee does not allows extension beyond 48 months from the date of issue of Authorisation and that period has already lapsed, the committee did not accede to the request.

(Action: RA, Kolkata: If the applicant fails to get their cases regularized within a month from the date of publication of these minutes on this Directorate web-site,

accede to the request.

(Action: RA, Kolkata: If the applicant fails to get their cases regularized within a month from the date of publication of these minutes on this Directorate web-site,

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RA shall initiate action as per the provisions of FT(D&R) Act, 1992, as amended and report.)

Case No.16: M/s. Hindustan Platinum Pvt. Ltd., Mumbai.

F.No. 01/60/162/51/AM16/ EFGC(PRC)

Subject: - Request for 2nd Revalidation against Advance Authorization No.

0310716794 dt.10.12.2012.

Decision:

The Committee observed that the RA has already allowed one revalidation for six months thus the applicant had sufficient validity period to affect their balance 47% imports. The justification that they could not complete their imports due to slow down in business, cannot be construed to be a genuine hardship. Hence, the Committee did not accede to the request.

Case No.17: M/s. Asian Tire Factory Ltd., Jalandhar.

F.No. 01/60/162/693/AM15/ EFGC(PRC)

Subject: - Request for Revalidation of DFIA Nos. 3010090289 dt. 05.12.2012,

3010093093 dt. 02.04.2013, 3010090950 dt. 04.01.2013 & 3010092044 dt.19.02.2013.

Decision:

The Committee noted that the applicant was well aware off the facts that item no 2 to 9 permitted in the Authorisations were allowed with “Actual User” condition. Therefore, they should have completed their imports within initial /extended validity of Authorisations. RA has allowed one revalidation for six months and endorsed transferability clause on the Authorisation. Revalidation of transferable Authorisation is not allowed unless the Authorisation expires in the custody of Government agencies. Here, that is not the case. Hence, the Committee did not accede to the request.

Case No.18: M/s. Indian Dyestuff & Chemicals Mfg. Co., Mumbai.

F.No. 01/60/162/71/AM16/ EFGC(PRC)

Subject: - Request for Revalidation of Advance Authorization No. 0388048125

dt.07.09.2012.

Decision:

The Committee noted that the justification given by the applicant that they could not complete their import due to non-availability of essential raw materials cannot be a true fact, as the ‘Phthalic Anhydride’ the only balance input in the Authorisation is not such a material which is not available in the international market. Further, no supporting documents were supplied by the applicant to sustain their contention. RA has already allowed one revalidation for six

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months. Hence, the Committee did not find any merit in the case for grant of further revalidation.

Case No.19: M/s. Hindustan Platinum Pvt. Ltd., Mumbai.

F.No. 01/60/162/68/AM16/ EFGC(PRC)

Subject: - Request for 2nd Revalidation against Advance Authorization No.

0310731763 dt.18.04.2013.

Decision:

The Committee noted that the RA has already granted one revalidation for six months against the Authorisation. The applicant has not furnished any cogent and sustainable reasons for not affecting imports during the original / extended validity period. Hence, the committee did not accede to the request.

Case No.20: M/s. Plastene India Ltd., Gujarat.

F.No. 01/60/162/78/AM16/ EFGC(PRC)

Subject: - Request for 2nd Revalidation against Annual Advance Authorization No.

3710001776 dt.13.12.2011.

Decision:

The Committee noted that the RA has already allowed one revalidation for six months and the applicant has imported 79.31 % goods. No cogent and sustainable reasons could be established for not affecting balance 20.69% imports during the initial / extended validity period. If there was uncertainty in the market and fluctuation in the foreign currency then as to how they have completed 79.31% imports? Hence, the Committee did not accede to the request.

Case No.21: M/s. Pithampur Poly Products Ltd., Indore.

F.No. 01/60/162/69/AM16/ EFGC(PRC)

Subject: - Request for Revalidation of Advance Authorization No. 1110021097

dt.29.09.2009.

Decision:

The Committee noted that the applicant has imported 100% against items No one, 95% against item No two and 45% against third item out of 4 items permitted under the Authorisation. Hence global slowdown cannot be construed as a cogent and sustainable ground for not importing remaining one item. He had option of obtaining one more revalidation for six months from RA but did not avail that facility. Hence, the Committee did not find any merit in the case for grant of further revalidation.

Case No.22: M/s. Plastene India Ltd., Gujarat.

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F.No. 01/60/162/49/AM16/ EFGC(PRC)

Subject: - Request for 2nd Revalidation against Two Advance Authorization No.

3710001774 dt. 13.12.2011 & 3710001775 dt.13.12.2011.

Decision:

The Committee noted that the applicant has completed imports and exports almost on prorate basis and RA has allowed one revalidation for six months thus, there is no merit in the case for grant of further revalidation. Hence, the committee did not accede to the request.

Case No.23: M/s. Indo Phyto Chemicals Pvt. Ltd., New Delhi.

F.No. 01/60/162/710/AM15/ EFGC(PRC)

Subject: - Request for Revalidation and extension of E.O. of Advance Authorization

No. 0510336434 dt.04.10.2012.

Decision:

The Committee noted that the applicant has imported one item 99.98% and RA has allowed one revalidation for six months. The applicant had sufficient validity period to affect their balance imports against three items too. The applicant has not furnished any valid reasons for not affecting imports during the initial / extended validity period. Hence, the Committee did not find any merit in the case for grant of further revalidation.

So far as the request for EOP extension is concerned, the Committee noted that the RA has granted one extension of six months and the applicant has fulfilled 81.10% export obligation within 24 months. Hence, the Committee decided the following:

I. Export obligation period be extended further by 6 months i.e. upto 30.04.2015.
II. This is only for accounting and regularization of exports already effected. III. This is subject to payment of a composition fee @ 0.5% per month of FOB value of export made after 24 months.
IV. The minimum value addition of 15% as prescribed under Para 4.09 of FTP (2015-2020) shall be maintained. V. The applicant has to pay customs duty plus interest on inputs consumed and exported after 30 months i.e. after 30.04.2015.

Case No.24: M/s. Brass Copper & Alloy (India) Ltd., Mumbai.

F.No. 01/60/162/50/AM16/ EFGC(PRC)

Subject: - Request for Revalidation of DFIA No. 0310700450 dt.02.07.2012.

Decision:

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The Committee noted that the Regional Authority (RA) has already allowed one revalidation for six months. Even after endorsement of transferability, the Authorisation was remain valid for more than a month to complete imports.
Hence, the Committee did not accede to the request.

Case No.25: M/s. Good-Day Foods Ltd., Thane.

F.No. 01/60/162/457/AM14/EFGC(PRC)

Subject: - Request for EOP extension of Advance Authorization No. 0310518965

dt.07.05.2009. or accounting of ‘Free Shipping Bills’ towards discharge of export obligation.

Decision:

The Committee observed that the Authorisation in question was obtained under

Para 4.7 of FTP, 2009-2014 on self- declaration basis. Accordingly, the applicant

should abide by the decision of the Norms Committee and pay duty plus interest against excess import, if any. The applicant’s plea that they have exported some goods against free shipping bills gives strength to the decision of Norms Committee that wastage claimed by the applicant was on higher side. Therefore, the Norms Committee reduced the wastage norms. Further, exports made against “Free Shipping Bills” cannot be taken into account towards discharge of export obligation, as the same were not assessed by the Customs Authority. The Committee, therefore, did not accede to the request.

Case No.26M/s. Tube Products Incorporate, Vadodara.

F.No. 01/60/162/660/AM13/ EFGC(PRC)

Subject: - Request for revalidation of DEPB No. 3410027862 dt.06.09.2010.

Decision:

The committee noted that request of the applicant and on perusal of report of RA, Vadodara and NIC, it was concluded that DEPB was issued wrongly combining shipments made from EDI and non-EDI ports. Shipments made from non-EDI port cannot be transmitted online to DGFT server. Similarly, DEPB issued against non-EDI Shipping Bills cannot be transmitted online to Customs server. Therefore, the applicant should had made separate two application consisting EDI and Non-EDI shipping bills. RA should had also not processed the request of the applicant on that ground. The committee therefore decided as follows: (1) DEPB No 3410027862 dated 06.09.2010 shall be cancelled. (2) The applicant shall file two separate applications for EDI and Non-EDI port. (3) RA shall issue two separate DEPBs for EDI and Non-EDI port. (4) Delay in filling application is condoned.

Case No.27: Request of Shri Madhava Chandra, former High Commissioner of India

to Papua New Guinea.

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F.No. 01/89/Misc.14/AM-10/PC-II (A)

Subject: - Request of Shri Madhava Chandra, former High Commissioner of India to

Papua New Guinea, for relaxation of policy to import a Mitsubishi Pajero Mini (SUV – 42 D – Automatic), with 660 cc engine capacity of 2012 manufacture .

Decision:

The Committee observed that the tenure of Shri Madhava Chandra, former High Commissioner of India to Papua New Guinea, retired on 30th September, 2015, was from 29th July, 2014 to 30th September, 2015 i.e. 14 months. The aforesaid car was registered in Port Moresby on 02.02.2015. Therefore, the Committee taking into consideration all facts, decided to relax Policy condition 3 (I) (a) of Chapter 87 of ITC (HS), 2012, Schedule – I (Import Policy) for import of a Mitsubishi Pajero Mini (SUV – 42 D – Automatic car), with 660 cc engine capacity of 2012 make for CIF value of US$12,622.

The committee ended with a vote of thanks to the chair.

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