Following new clauses are replaced under paragraph 6 of the Circular No.579/16/2001–CX dated 26.06.2001 contains  provisions relating to “Period of warehousing“.

(a) Warehousing of goods shall initially be allowed for a period up to six months, which may be further extended by the Assistant /Deputy Commissioner, each extension being for a period not exceeding six months, subject to the verification that the goods have not deteriorated in quality. The maximum period, for which goods may be left in the warehouse in which they are deposited ,or in any warehouse to which such goods have been removed, shall be three years from the date on which such goods were first warehoused. Excisable goods shall be deemed to be cleared for home consumption on expiry of the warehousing period including the extensions granted, if any. Duty and interest @ 24% per annum shall be charged on such deemed removal.

(b) If the registration of a warehouse is revoked or suspended, the excisable goods lodged therein shall either be cleared for home consumption on payment of duty and interest @ 24% per annum or shall be removed to another warehouse without payment of duty

Submission of BG (Bank Guarantee) leads to increase in transaction cost and, therefore, manufacturer exporters who are also status holders may be allowed to submit Letter of Undertaking (LUT) in place of BG. On examination, it has been decided to amend paragraph 3.2 and paragraph 4.2.1 of the Circular No.581 dated 29.06.2001 reg. security.  Accordingly Board specifies that these paragraphs be amended as follows:

(i) Paragraph 3.2: After the words “backed by twenty five percent security of the bond amount” the words “in the manner  as prescribed in paragraph 4.2” shall be added.

(ii) Paragraph 4.2.1: A proviso, as follows, shall be inserted at the end of the paragraph.

Provided that where the exporter is a manufacturer and a Status Holder with a clean track record, the requirement to furnish security equal to 25% of the bond amount shall be replaced by the requirement of furnishing an LUT initially for a period upto six months which may be extended by a further period not exceeding six months. Further extensions in the warehousing period in terms of paragraph 6(a) of the Circular No.579/16/2001-CX dated 26.06.2001 shall be allowed to such exporter only on furnishing security of 25% of the bond amount.

Board also specifies that paragraph 2(1) of the Circular No.581 be amended as follows:

Paragraph 2(1): In this paragraph dealing with Exporters, expression “The exporters who have been accorded status of Super Star Trading House or Star Trading House” may be replaced with the expression “The exporters who are Status Holder under FTP - 2009-14”. Export warehousing facility would become available to all Status Holders under FTP of 2009-14 due to this amendment.

For original Circular, please click here