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Circular No. 23/2018-Customs

F.No. DGEP/G&J/22/2018
DIRECTORATE GENERAL OF EXPORT PROMOTION
Ministry of Finance, Deptt. of Revenue
8
th
Floor, Tower-2, LIC, Jeevan Bharti Building
Connaught Place, New Delhi -110001
Tel: 23722439, Fax: 23722443
e-mail: dgep.dor@gmail.com

Dated: 23
rd
July, 2018

To,

All Principal Chief Commissioners/ Chief Commissioners of Customs
All Principal Chief Commissioners(Prev.)/ Chief Commissioners of Customs
(Prev.)

Subject: Procedure to be followed by nominated agencies importing gold/
silver/ platinum under the scheme for ‘Export Against Supply by
Nominated Agencies’-reg.

Sir/ Madam,

Circular no. 27/2016-Customs dated 10.06.2016 was issued providing
for a simplified procedure in view of non -applicability of warehousing
provisions to duty free gold/ silver/ platinum obtained by the nominated
agencies by virtue of an exemption notification issued in this regard. This
procedure was prescribed after reviewing the procedure laid down for duty free
import of gold/ silver/ platinum by nominated agencies for supply to exporters
vide Circular No. 28/2009-Customs dated 14.10.2009 so as to avoid divergent
practices and to streamline the supply of precious metals for exports.

2. Gems and Jewellery Export Promotion Council (GJEPC) has represented
that problems are being faced in the field as one to one correlation between the
gold procured duty free under N otification No. 57/2000-Customs dated
08.05.2000 and corresponding export of jewellery is being insisted upon by the
Customs. GJEPC has represented that it was impossible to establish one to
one correlation between such procurement and jewellery manufactured and
exported out of the same owing to the homogenous nature of precious metals.

3. The matter has been examined. Para 4.34 of Foreign Trade Policy
provides the scheme whereby exporter of gold/ silver/ platinum jewellery or
articles thereof could obtain gold/ silver/ platinum as an input for export
product from nominated agencies, in advance. Corr espondingly, Customs

Notification No. 57/2000-Customs dated 08.05.2000 provides an exemption
from Basic Customs Duty (BCD) on import of gold/ silver/ platinum provided
the importer binds himself to export either himself or through other exporters
gold/ silver/platinum jewellery including studded articles having gold/ silver/
platinum contained equivalent to the imported gold/ silver/ platinum within a
period of 90 days.

4. Neither the provisions of the Foreign Trade Policy nor the said
notification and aforementioned circulars refer to the requirement of a one to
one correlation between the gold procured and the jewellery exported. The
construct of Foreign Trade Policy read with C ustoms notification clearly
provides that the nominated agency must establish that imported duty free
gold/ silver/ platinum has been exported through the manufacture of
gold/silver/platinum jewellery including studded articles through the
maintenance of proper records at the end of the nominated agency as well as
that of exporter. There is therefore no requirement of establishing one to one
correlation between the consignment of gold/silver/platinum imported and the
export of jewellery. However, the nominated agencies/ exporters are required
to maintain the accounts of duty free gold and domestically procured duty paid
gold in such manner so that duty free gold/ silver/ platinum obtained for the
purpose of export of jewellery is clearly accounted for by the export of jewellery
/articles.

5. Difficulties, if any, may be brought to the notice of the Board.

6. Hindi version will follow.



Yours faithfully,

Sd/-

(Saroj Kumar Behera)
Joint Director