Subject :    Exemption from Bank Guarantee to manufacturer Exporters under DEEC and EPCG Schemes -regarding.

        In partial modification of Board's Circular No. 45/96-Cus dated 28.8.1996 vide F.No. 605/75 (A)/ 95-DBK, it has been decided that Manufacturer - Exporters registered with the Central Excise Department shall be exempted from furnishing Bank Guarantee under the DEEC and EPCG Schemes. Under EPCG Scheme the facility shall be available to EPCG Licences issued after 1.4.1995.

2.    The exemption from furnishing Bank Guarantee shall be available provided the following conditions are fulifled :-

(i)    Where he has been already issued an EPCG Licence, and is having a turnover of Rs. 1 Crore or more in the preceding financial year;

(a)    he must also have a record of having achieved the export obligation specified in the EPCG notification (s); or

(b)    if the Export Obligation has not expired, the Exporter has not defaulted on the export obligation specified in EPCG for the block period in any licence(s) as prescribed in the relevant Customs notification (s).

(ii)    for a licence holder who has no previous licence issued under EPCG Scheme, he must have Export turnover of Rs. 1Crore or more in the preceding financial year. The exemption from Bank Guarantee shall however the withdrawn if such exporter  defaults on his export obligation for two successive block periods under Zero duty EPCG Scheme, or for three consequtive years under 10% duty EPCG Scheme.

(iii)   for exporters operating under the DEEC Scheme, where he has been issued a DEEC Licence(s) and he has a turnover of Rs. 1 Crore or more in the preceding financial year, he must have a record of achieving the export obligation as specified in the relevant customs notification(s).

(iv)   for first time licence holders under DEEC Scheme, who have previous export performance with a turnover of Rs. 1 Crore or more in the preceding financial year.

(v)   the exporter should not have been penalised under the provisions of Customs Act, Foreign Exchange Regulation Act or Foreign Trade (Development and Regulation) Act during the last two financial years.

(vi)  Provided that the person standing surety to the Bond (format annexed to the Circular) is certified by his Bank or a hartered Accountant that he is solvent.

        WHEREAS I/ we, the obligor (s), have imported goods listed in Annexure I availing customs duty exemption in terms of the Notification the Government of India in the Ministry of Finance (Department of Revenue) No. ____________________ dated the  __________________ (hereinafter referred to as the said notification) against the Import Licence No. _________________ dated ___________________ (hereinafter referred to as the licence) for the import of the goods mentioned therein on the terms and conditions specified in the said notification and licence.

WHEREAS I/ we the obligor (s) is / are manufacturer exporter (s) holding registration No. _____________ dated _____________ with the (name and address of the registering Central Excise authority to be mentioned) ____________________ .

        WHEREAS I /we the obligor(s) has/ have undertaken to fulfil the export obligation as specified in the said notification and the licence and to produce evidence of having so fulfilled the export obligation within 30 days from the expiy of the specified Export Obligation period to the satisfaction of the Government.

2.    I / we, the obligor(s) shall observe all the terms and conditions specified in the licence'

3.    I / we, the obligor(s), shall fulfil the export obligation as specified in the said notification and the licence and shall produce      evidence of having so fulfilled the export obligation within 30 days from the expiry of the specified export obligation period to the     satisfaction of the Government.

4.    In the event of failure of fulfil full or part of the export obligations as specified in the said notification and the licence, I/ we, the      obligor(s), herein undertake to pay the customs duty but for the exemption and also interest @ 24% per annum thereon forthwith and without any demur, to the Government.

5.    I/ we, the obligor(s), shall comply with the conditions and limitations stipulated in the said Import and Export Policy as amended from time to time.

6.    I / we, the obligor(s), shall not change the name and style under which we, the obligor(s), are doing business or change the location of the manufacturing premises except with the written permission of the Government.

       It each and everyone of the above condition is duly complied with by us the obligor(s), the above written bond shall be void and of no effect, otherwise the same shall remain in full force and effect and virtue.

       It is hereby declared by us, the obligor(s) and the Government as follows:

1.    The above written bond is given for the performance of an act in which the public are interested.

2.    The Government through the Commissioner of Customs or any other officer of Customs recover the sums due from the obligor(s) in the manner laid down in sub-section(1) of the section 142 of the Customs Act, 1962.

       Provided always that the liability of the surety here under shall not be impaired or discharged by reason of any time being granted, or any forbearance, act or omission of the Government (whether with or without the knowledge or the consent of the surety) in respect of or in relation to the obligation and condition to be performed or discharged by the obligor(s) nor shall it be necessary to sue the obligor(s) before suing the surety for amounts here under.

        AND the president of India shall, at his option, be competent to make good all the loss and damages by endorsing his rights under the above written bond.

        I/ we further declare that this bond is given under the order of the Central Government in the performance of an act in which the public are interested.

        In these presents the words imposing singular shall also include the plural and vice-versa where the context so requires.

        IN WITNESS HEREOF these presents have been signed this day ______________ of ___________19 _______ herein before written by the obligor(s) and the surety (ies).

Place:
Date:

Accepted for and behalf of the President of India on ___________________day of ____________ 19 ______________.