Electronics Body Irked By New Excise Rules

Elcina president N Ramachandran said in a press release that the countrys electronic components industry would have to face unnecessary financial burden and delay in release of materials as a result of the new excise procedures.

This would lead to levying of demurrage charges on import materials at the customs.

Elaborating on the working of the new procedure, the chairman said that for the import of raw materials going into electronic components, an importer must first apply to the Central Excise for a registration certificate.

After this the importer has to submit an endorsement application to the assisstant commissioner of Central Excise each time he wants to clear a consignment of raw materials from the customs.

In addition, the Central Excise has to be provided with a bond for the differential duty and the importer has to maintain a running bond account with the mentioned authorities for a year.

The importer of materials is also required to intimate the Central Excise within two days of the arrival of the imported consignment.

The new excise rules will create an additional burden on manufacturing units as most of the raw materials required by the electronic components industry are not manufactured in India and have to be imported, Ramachandran said.

The industry, he added, already suffers from a crisis because of large imports and this would further affect its competitiveness.

In contrast, the import of finished electronic components has been made relatively trouble-free and requires an import duty of only 20 per cent for clearance.

In a letter to the finace minister, Elcina has warned that the lack of a level playing field could force the closure of several manufacturing units in the country.