BANK GUARANTEE EXEMPTION UNDER ADVANCE AUTHORIZATION, DFIA AND EPCG SCHEMES-CUSTOM CIRCULAR NO. 31/2019 DATED 13.09.2019

Customs Department extending the exemption for execution of Bank Guarantee (BG) based upon the export turnover, quantum of duty, tax paid, etc. vide earlier circular No. 58/2004-Cus dated 21.10.2004 as amended vide circular Nos. 17/2009-Cus dated 25.05.2009, 32/2009-Cus dated 25.11.2009, 06/2011-Cus dated 18.01.2011, 08/2013-Cus dated 04.03.2013 and 15/2004-Cus dated 18.12.2014 in view of the implementation of GST from 01.07.2017 has now issued Circular No. 31/2019-Cus dated 13.09.2019 which devised the norms for BG under Advance Authorisation, DFIA & EPCG scheme.

The manufacturer exporters/service providers are eligible to claim exemption from furnishing Bank Guarantee under following two situations:

  1. Manufacturer exporters/Service Providers registered with the GST authorities (Centre/State/Union Territory) who have been exporting during the previous two financial years and have minimum export of Rs. 1 crore or more during the preceding financial year.
  2. Manufacturer exporters/Service Providers registered with the GST authorities (Centre/State/Union Territory) who have paid GST of Rs.1 crore or more during the preceding financial year.

Further clarification have been made which are as follows:

  • in cases where the AA/DFIA/EPCG authorisation holder is a registered member of an EPC, he shall produce a certificate of export performance or payment of duty/GST for the purpose of availing Bank Guarantee exemption from the concerned EPC on the lines of similar facility available earlier
  • where the AA/DFIA/EPCG authorisation holder is not a registered member of an Export Promotion Council, he may produce such certificate duly authenticated by a practicing Chartered Accountant who is registered with the GST Department (Centre/State/Union Territory) for payment of GST
  • the requirement of obtaining certificate from jurisdictional superintendent of Central Excise has been discontinued.

Our Corporate Professional Team is ever willing to provide assistance on any issue concerning GST, Insolvency and Bankruptcy Law, Business Model Advisory in India and Abroad, Customs Law, Corporate & Commercial Advisory, IPRs. Secretarial Compliances, Agreement Drafting & Negotiations etc. you may write us on connect@legallands.com, contact@legale-services.com

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