'Advance permit a must for duty-free import'

CHAT ROOM

We obtained an advance authorisation with three inputs. We have fully utilised the authorisation, but the export obligation has been fulfilled only partly. We want to utilise the duty-free inputs for manufacture of another product and export. For manufacture of that other product, we need two more raw materials to be imported duty-free. How can we go about it?
I suggest you take another advance authorisation for the second product, seeking import of all the five inputs duty-free.

You may not use the second authorisation for the stock of duty-free raw materials that you already have, but use the authorisation only for duty-free import of the two additional raw materials. After fulfilling the export obligation against the second authorisation, you may seek to club the two authorisations as per DGFT Policy Circular no. 29/2007 dated 6th February 2007, which says that the clubbing facility is available for clubbing of more than one authorisation, provided the imported inputs are properly accounted for as per norms.

It further clarifies that as long as imported inputs (for which clubbing has been sought) are the same, the facility of clubbing would be available for closure of the authorisations, irrespective of the fact that the export products are different.

You could still face difficulties at the Regional Authority level on the grounds that the second authorisation has two more inputs, but I am of the view that such difficulties can be overcome at the higher levels on the basis of evidence that inputs are duly accounted for.

We are a 100 per cent export-oriented unit (EOU). We get most of our local raw materials duty-free against CT3, but in some cases we have bought from registered dealers and taken Cenvat Credit. We have also accumulated Credit because of service tax that we pay. Can we get refund of the accumulated Credit?
Refund of unutilised Credit on account of export under bond/UT1 is covered under Rule 5 of Cenvat Credit Rules, 2004. In the case of GTN Exports [2009 (236) ELT 110 (Tri. Chennai)], the Tribunal has held that here is no prohibition from claiming and obtaining refund of accumulated Cenvat credit by an EOU under Rule 5 of Cenvat Credit Rules, 2004 and that an EOU can claim such a refund every month in terms of Notification No. 5/2006-C.E. (N.T.) dated 14th March 2006.

We are manufacturing dutiable as well as exempted products. We maintain separate records as per Rule 6(2) of Cenvat Credit Rules, 2004. The audit party has now objected that the accounts are not proper. Is there any prescribed format for maintaining the records?
There is no prescribed format for maintaining accounts, but the accounts maintained should disclose the receipt, consumption and inventory of the inputs used in the manufacture of the dutiable products separately from those used in the exempted products.

In this connection, you may refer to the case of Shreyans Industries Ltd. vs. CCE, Jalandhar [2010 (249) ELT 301 (Tri. Del.)]