CUSTOMS NOTIFICATION No.35/2001 Dated 30th March, 2001 
Duty exemption for  raw pearls, natural or cultured, rough diamonds and other precious or semi-precious stones, unset and uncut.

In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 27/2001-Customs, dated the 5th March, 2001 (GSR 163(E), dated the 5th March, 2001) except as respects things done or omitted to be done before such supersession, the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts raw pearls, natural or cultured, rough diamonds and other precious or semi-precious stones, unset and uncut, falling under Chapter 71 of the First Schedule to the Customs Tariff Act, 1975(51 of 1975), when imported into India, from the whole of the duty of customs leviable thereon under the said First Schedule and the additional duty, if any, leviable thereon under section 3 of the said Customs Tariff Act, subject to the following conditions, namely :- 

(a)

the imports are made under a,-

 

 (i)

Replenishment Licence issued under, and in accordance with, paragraph 8.2 of the Export and Import Policy;

 

 

(ii)

Replenishment Licence issued under, and in accordance with, paragraph 8.37 of the Export and Import Policy;

 

 

(iii)

Gem Replenishment Licence issued under, and in accordance with, paragraph 8.38 of the Export and Import Policy;

 

 

(iv)

Replenishment Licence issued under, and in accordance with, paragraph 8.74 of the Handbook of Procedures;

 

 

(v)

Diamond Imprest Licence issued under, and in accordance with, paragraph 8.3 of the Export and Import Policy;

 

 

(vi)

Bulk Licence issued under, and in accordance with, paragraph 8.10 of the Export and Import Policy; or

 

 

(vii)

Replenishment Licence issued under, and in accordance with, paragraph 8.13(a) of the Export and Import Policy, read with paragraph 8.26(d) of the Handbook of Procedures;

 

(b)

in case of rough diamonds imported under the Diamond Imprest Licence referred to at item (v) of condition (a), the importer executes a bond in such form and for such sum and with such surety or security as may be specified by the Assistant Commissioner of Customs or Deputy Commissioner of Customs, as the case may be, binding himself- 

 

(i)

to discharge the export obligation as fixed for the said licence in the manner and as per procedure specified in the Export and Import Policy of Handbook of Procedures, and to comply with the conditions stipulated in the relevant provisions thereof;

(ii)

to pay on demand, in case of failure to achieve any part of export obligation, an amount equal to the duty leviable on the value of the said rough diamonds but for the exemption contained herein which can be attributed to export obligation not fulfilled alongwith interest at the rate of 24% per annum on the said duty from the date of clearance of such duty free imported rough diamonds till the date of payment of such duty;

 

(c)

in case of rough diamonds imported under Bulk Licence referred to at item (vi) of condition (a), the importer executes a bond in such form and for such sum and with such surety or security as may be specified by the Assistant Commissioner of Customs or Deputy Commissioner of Customs, as the case may be, binding himself-

 

(i)

to account for disposal of said rough diamonds by way of supplies to holders of valid Replenishment  Licence/ Diamond Imprest Licence, 100% Export Oriented Undertakings / Export Processing Zone units /Special Economic Zone units or re-export, in accordance with, and as per procedure specified in the Export and Import Policy and Handbook of Procedures, and to comply with the conditions stipulated in the relevant provisions thereof;

 

 

(ii)

to pay on demand, the duty on the said rough diamonds as are not properly accounted for by him alongwith interest at the rate of 24% per annum on the said duty from the date of importation of the said rough diamonds till the date of payment of such duty.

 

Explanation I.- for the purposes of item (ii) of condition (b), the value of imported rough diamonds attributed to export obligation not fulfilled shall be calculated from the total value of imports effected against the licence under this notification by applying the ratio between unfulfilled export obligation and total export obligation. 

Explanation II.- For the purposes of this notification,- 

(i)

“Export and Import Policy” means the Export and Import Policy, 1997-2002, notified by the Government of India in the Ministry of Commerce, vide notification No.1(RE-99)/1997-2002 dated the 31st March, 2000, as amended from time to time.

 

 

(ii)

“Handbook of Procedures” means the Handbook of Procedures, Volume I, published vide Public Notice of the Government of India in the Ministry of Commerce, No.1 (Re-2000)/1997-2002, dated the 31st March, 2000, as amended from time to time.

  

Sd/-

(Rajendra Singh)

Under Secretary to the Government of India