Export Obligation Period For Advance Licences Extended

The government today announced the extension of the export obligation period for advance licences issued after April 1, 1997 by six months. Companies have unfulfilled export obligations worth around Rs 500 crore for the period. Commerce department officials said that the step will help push Indian exports by $100-200 million over the next couple of months.

Advance licences for physical exports issued on or after April 1, 1997 with a stipulated 30-month period for fulfilling the export obligation has expired.

In a public notice issued on Wednesday, the directorate general of foreign trade said that those licenceholders who have not fulfilled their obligation can now seek an extension on submission of a bank guarantee.

The guarantee would cover the customs duty along with a 24 per cent simple interest on the unutilised exempt material for the date of import up to the period for which export obligation is sought.

The guarantee would be forfeited if the obligation is not fulfilled in the extended period.

The extension has to be sought within 60 days and the bank guarantee should be valid for a period of 12 months which expires on May 6, 2002.

The public notice also said that the government would not provide any extension in case of a fraud or misrepresentation or an adjudicating order has already been passed.

In cases where export obligation has been made prior to the government decision but after expiry of the stipulated period for fulfilling export obligation, but a composition fee of 1 per cent or 5 per cent or both has not been paid, the exports during the extended period would be regularised on payment of the amount, DGFT has stipulated.