I am directed to say that certain instances have been brought to the notice of the Board, wherein show cause notices have been brought to the notice of the Board, wherein show cause notices have been issued to units working under the EOU/ EPZ scheme on matters involving interpretations of provisions and scope of exemption notification, eligibility of duty free imports etc. without referring the issue to the Board for examination and clarification. This has led to complaints of harassment of exporters and adverse publicity.

        Board desires that in view of circular No. 21/95-Cus. (F.No. 307/2/91-FTT) dated 10.03.1995, prompt action should be taken for issue of SCNs against units indulging in gross violations of law like illicit removal/ non-accountal/ disappearance of goods and the like. On issues like the not-fulfilment of export obligations action has to be initiated in consultation with the Development Commissioners or the commerce Ministry. But in matters involving interpretations of statutory provisions or the policy provisions or the scope of notifications, the issues may be referred to the Board demi officially, (giving the details properly and enclosing copies of documents on which doubts have arisen) for detailed examination in the Board's Officer. In such cases, show cause notices should be issued only after the issues are examined and the legal position settled. This would avoid situations wherein the allegations in the notices might be found unsustainable in terms of EXIM Policy/ customs law and may have to be dropped by the department itself.