We refer to the RBI Master Circular dated 1st July 2011 on Export of Goods and Services. As per Para C.20 of the Circular, banks can consider extending the period of realisation of export proceeds beyond 12 months from the date of export, up to a period of six months at a time, irrespective of the invoice value of the export, provided the total outstanding of the exporter does not exceed one million dollars or 10 per cent of the average export realisations during the preceding three financial years, whichever is higher. Our bankers say that for calculating our outstanding, we should consider even the bills that are not yet due for payment. This seems harsh as we have heavy exports this year and if even exports that are not due for payment are taken into account, we will exceed the 10 per cent limit. Is there any way to consider only those bills that are outstanding beyond the one-year period allowed for realisation?
The RBI Master Circular is quite categorical that the total outstanding should not exceed the 10 per cent limit. So, while I agree with you on the harshness of the provisions, your bankers are quite right in insisting that you must take into account all the bills that are outstanding at the time of seeking extension, whether due for payment or not.
In your column Exim Matters dated 19th December 2011, you have mentioned that from 1.3.2012, under notification 21/2004-CE(NT) dated 6.9.2004, inputs can be procured under rebate claim for manufacture of goods for exports to Nepal. We do not find the amending notification and do not understand why it has been left out. Please clarify.
The Central Excise non-tariff notifications 24 to 29 all dated 5.12.2011 do not amend notification no. 21/2004-CE(NT) dated 6.9.2004. So, I clarify that you cannot procure inputs under rebate claim under the notification, unless an amendment comes forth. I have no idea why this notification has been left out when the notifications 43-CE(NT) dated 26.6.2001 and other similar notifications relating to Nepal have been amended. The notification to amending 21/2004-CE(NT) dated 6.9.2004 may be issued soon.
We have an order from a merchant exporter, who says that he cannot issue CT-1, as he is not registered with Central Excise. If there is any other way to clear the goods for export without excise duty payment, can you give the references?
A merchant exporter need not have Central Excise registration to issue CT-1. If he is registered with the concerned Export Promotion Council, he can execute a bond without any bank guarantee and issue CT-1. In that case, he will be responsible for furnishing proof of exports. Alternately, you can also execute a bond with your Central Excise authorities and clear the goods without duty payment. In this case, you will be responsible for furnishing the proof of exports. You may refer to Chapter 7 Part-II of the Central Excise Manual available in the CBEC website cbec.gov.in for details.
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