Page 197 - ELT_1st August 2020_Vol 373_Part 3

2020 ] K. DHANDAPANI & CO. LTD. v. D.G.F.T., NEW DELHI 379

(a) All pending cases of the default in meeting Export Obligation (EO)
can be regularised by the authorisation holder on payment of applica-
ble Customs duty, corresponding to the shortfall in export obligation,
along with interest on such Customs duty; but the interest component
to be so paid shall not exceed the amount of customs duty payable for
this default.
[Here is an example : Suppose the default in EO is 100%, this would
mean the complete duty saved amount has to be refunded. The inter-
est on this duty saved amount has to be calculated from the date of
import till the date of payment. The interest component under this
dispensation would be limited to the duty saved amount. If the duty
saved amount were Rs. 150, then the interest component would be
limited to Rs. 150 and therefore for regularising this case the maxi-
mum amount to be paid by the authorisation holder would be Rs. 300.
However, for the same duty saved amount of Rs. 150, if the default in
EO were 30%, then the corresponding duty saved amount becomes Rs. 45
(30% of Rs. 150). Hence the interest component will be limited to Rs 45.
Thus, duty + interest will not exceed Rs. 90 for this regularisation of 30% de-
fault in EO for a duty saved amount of Rs. 150.]
(b) In line with the existing policy the Customs duty could be paid either
in cash or by way of debiting of any valid duty credit scrips issued
under Chapter 3 of the Foreign Trade Policy. The interest component
however, has to be paid in cash only.
(c) Any authorisation holder choosing to avail this benefit must complete
the process of payment on or before 31st March 2014.
(d) Necessary procedures including a system of filing required reports by
the respective RAs would be indicated separately.
54. The Ministry of Commerce had considered the difficulties faced by
the manufacturer exporters like the petitioners and had therefore over a period
of time relaxed the rigours by reducing the interest. Earlier, Public Notice No.
5/(RE-99)/1997-2002, dated 6-4-1999 was issued giving an opportunity to per-
sons like the petitioners to regularise the default by extending the period of ex-
port obligation upto 31-3-2001 provided applications were made by such manu-
facturer-exporters within the stipulated time and a bond was executed undertak-
ing to pay Customs duty together with 24% interest from the date of import upto
30-9-2001.
55. The Ministry of Commerce later realised the difficulties faced by the
importers who availed the benefit of various duty exemption notification. There-
fore, paragraph No. 2 of Notification No. 160/1992-Customs, dated 20-4-1992
was amended vide Sl.No. 1 to Notification No. 46/2013, dated 26-9-2013 which
reads as under :-
“2. In case of default in export obligation, when duty on goods is paid to
regularise the default, the amount of interest paid by importer shall not ex-
ceed the amount of duty if such regularisation has been dealt in terms of
Public Notice of the Government of India in the Ministry of Commerce No.
22 (RE-2013) 2009-2014 dated 12th August, 2013.”

EXCISE LAW TIMES  1st August 2020  197