Chatroom: Extension for exports realisation, RBI should review instructions

Our bank says that they cannot grant the extension for exports realisation beyond one year as our total outstanding exceed 10% of the average realisations in the preceding three financial years. Is that correct?
 

Yes. Para C.20(i)(d) of RBI Master Direction no.2015-16 dated  1st January 2016 (as amended) on Export of Goods and Services says that RBI has permitted the banks to extend the period of realisation of export proceeds up to a period of six months at a time subject to the condition that  ‘while considering extension beyond one year from the date of export, the total outstanding of the exporter does not exceed $1 million or 10 per cent of the average export realisations during the preceding three financial years, whichever is higher’. In this condition, I think the words ‘total outstanding’ should be read as ‘total outstanding beyond the period allowed by RBI for receipt of export proceeds’. Otherwise, the provision makes no sense because mostly, even extending a months’ credit to the buyers will cause the total outstanding to exceed 10 per cent of the previous three years export realisations. That cannot be the intention of the provision. RBI should re-examine the wordings of this provision suitably.
 

We have imported some items on which we paid the duty through RoDTEP scrips. Now, the goods are found to be defective. We have taken up with the seller and he has agreed to take back the goods. Our question is this: When we re-export the goods imported under the RoDTEP scrips, can we get a re-credit in the RoDTEP scrips or get credit in the RoDTEP ledger?
 

In theory, there is no reason for you not to get back 98 per cent of the duties you paid, when you re-export the same goods on which the duties were paid through RoDTEP at the time of imports. But, in practice, there is no specific provision to do so. I think you should take up the matter with the DGFT and ask for making a provision for issue of a duty credit certificate for 98 per cent of the duties paid, in the same way that there was a provision under the DEPB and other duty credit schemes like MEIS, FMS, FPS etc. and that based on such a certificate by the Customs, credit should be allowed in your RoDTEP ledger.
 

Our bank has given us a long list of small entries in the EDPMS that are not yet marked off. All these relate to samples exported by us through couriers. How to deal with the request of  the bank to regularize these entries?
 

I think the problem has arisen because while filing the shipping bills the couriers have wrongly ticked the box for ‘outright sale’ instead of ticking the box for ‘others’ and that is how the entry has got into the EDPMS. Now, you cannot amend the shipping bills and so, you may explain the error to the bank and seek write-off or closure of the entries. 

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