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Circular No. 18/98-Cus.
dated 16/3/98
 F.No. 305/215/97-FTT
Government of India
Ministry of Finance
Department of Revenue, New Delhi
Subject :    Destruction of scrap/ waste in the Export Processing Zones - Matter regarding.

        I am directed to refer to notification No.133 / 94-Cus dated 22.6.94 governing 100% EOUs set up in various Export Processing Zones/ Free Trade Zones. Under the above notification, seven earlier notifications each governing 100% EOU in an Export Processing Zone, Were rescinded. In this connection, the following doubts have been raised:
        (i)    Whether the actions taken earlier under these seven Notifications which were issued for seven Export Processing Zones, are deemed to have been done or taken under the corresponding provisions of the current Notn. No. 133/ 94-Cus which has rescinded all these seven notifications?

        (ii)    Whether defective or sub-standard computers and its parts which are not required (useful) for current production and have also not been used can be destroyed out side the zone i.e. whether the goods which were imported under an earlier notification could be allowed destruction under the present notification No. 133/ 94-Cus.

        (iii)    Whether the goods which are permitted for destruction within the zones can be taken for destruction outside the zones, as the notification only provides for destruction within the zone?

2.    The issue has been examined by the Board. It is clarified that action taken under the rescinded seven notification will be deemed to have been done or taken under the corresponding provision of the current notification No.133/94 and goods which were imported under any one of the earlier notifications could be allowed destruction under present notification. Under para 7(ii) of notification No. 133/94-Cus the imported goods as such may be allowed destruction and under para 7(iii), the scrap/ waste obtained in the process of manufacture may also be allowed destruction. In the cases where goods cannot be destroyed within the Zone because of the safety reasons or Municipal Corporation's  regulations, the Commissioner may permit destruction outside the Zone subject to such conditions as may be prescribed by the Commissioner since this is only a procedural requirement and non substantive in nature.

3.    Pending cases may be processed accordingly and the receipt of this letter may kindly be acknowledge.

(O.P. Khanduja)
Sr. Technical Officer (FTT)