Exemption to materials imported against a Special Advance Licence with actual user condition.
16-10-1998
Notification No. 77/98-Customs
In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central
Government, being satisfied that it is necessary in the public interest so to do, hereby exempts materials imported into India,
against a Special Advance Licence with Actual User Condition in terms of para 7.4 of the Export and Import Policy 1997-
2002 notified by the Government of India in the Ministry of Commerce vide Public Notice No. 41 (RE-98)/1997-2002, dated the
16th September, 1998 (hereinafter referred to as the said licence), from the whole of the duty of customs leviable thereon
which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and from the whole of the additional duty
leviable thereon under section 3 of the said Customs Tariff Act, subject to the following conditions, namely.
(i) that the materials imported are covered by the said licence and an Actual User Duty Exemption Entitlement Certificate
(hereinafter referred to as the said certificate), issued by the Licensing Authority in the form specified in the Schedule annexed
to this notification, in respect of quantity and description;
Provided that the value and details of the technical specifications of the materials shall be submitted by the importer to the
Assistant Commissioner of Customs or Deputy Commissioner of Customs having jurisdiction in the Bill of Entry and Part "D" of
the said certificate at the time of clearance;
(ii) that materials imported are required in export of the resultant electronic products made of the materials and the import of
the materials is made prior to the export;
(iii) that the resultant electronic products shall be manufactured only out of the materials imported under this notification.
(iv) that the importer at the time of clearance of the imported materials executes a bond with such surety or security and in such
form and for such sum as may be specified by the Assistant Commissioner of Customs or Deputy Commissioner of Customs
having jurisdiction binding himself to pay on demand an amount equal to the duty leviable, but for the exemption, on the
imported materials in respect of which the conditions specified in this notification have not been complied with, together with
interest at the rate of twenty-four per cent per annum from the date of clearance of the said materials;
(v) that the said licence and Part I of the said certificate are produced before the proper officer of customs at the time of
clearance for debit;
(vi) that the importer shall maintain the record of imported materials and the export products in the format as specified in the
Annexure to this notification;
(vii) the Designated Officer of the Department of Electronics (hereinafter referred to as the said officer) verifies the relevance/
useability of the imported materials in the export product as well as the quantity of such materials required for the manufacture
of such export product. The said officer shall also verify the actual utilisation of the imported materials in the export product as
well as the wastage in respect of export product in terms of the standard input output norms as specified in Volume II of the
Hand Book of Procedure of the Export and Import Policy 1997-2002 (hereinafter referred to as the Hand Book):
Provided that where such standard input output norms are not specified in the Hand Book for an export product, the said officer
shall determine and verify the relevance/useability of the imported materials as well as the quantity of such materials required
for the manufacture of such export product. The said officer shall also verify the actual utilisation of the imported materials in
such export product as well as the wastage as is determined by him to be reasonable.
(viii) that the imports and exports are undertaken through the sea ports at Mumbai, Calcutta, Cochin, Magdalla, Kakinada,
Kandia, Mangalore, Marmagoa, Madras, Nhava Sheva, Paradeep, Pipavav, Sikka, Tuticorin, Visakhapatnam , Dahej,
Nagapattinam , Okha and Mundhra or through any of the airports at Ahmedabad, Bangalore, Bhubaneshwar, Mumbai,
Calcutta, Coimbatore, Delhi, Hyderabad, Jaipur, Madras, Srinagar, Trivandrum, Varanasi, Nagpur and Cochin or through any
of the Inland Container Depots at Agra, Bangalore, Coimbatore, Delhi, Faridabad, Gauhati, Guntur, Hyderabad, Jaipur,
Jallandhar, Kanpur, Ludhiana, Moradabad, Nagpur, Pimpri (Pune), Pitampur (Indore), Surat, Tirupur and Varanasi, Nasik,
Rudrapur (Nainital), Dighi (Pune), Vadodara, Daulatabad (Wanjarwadi and Maliwada), Waluj (Aurangabad), Anaparthy
(Andhra Pradesh), Salem, Malanpur, Singanallur, Jodhpur, Kota, Udaipur, Ahmedabad, Bhiwadi , Madurai , Bhilwada and
Pondicherry or through the Land Customs Station at Ranaghat and Singhabad..
Provided that the Commissioner of Customs, may by Special Order and subject to such conditions as may be specified by
him, permit import and export through any other Sea port, Airport, or Inland Container Depot or through the Land Customs
Station;
(ix) that the sourcing of the imported materials from private bonded warehouses set up under para 5.15 of the Export and
Import Policy 1997-2002 would be allowed;
(x) that the export obligation is discharged within the period specified in the said certificate or within such extended period as
may be granted by the Licensing Authority by exporting resultant products manufactured in India which are specified in Part "E"
of the said certificate (hereinafter referred to as resultant products):
(xi) that the importer produces certificate from the said officer to the effect that the imported materials have been actually
utilised in the manufacture of resultant products and the said certificate is produced as evidence of discharge of export
obligation to the Assistant Commissioner of Customs or Deputy Commissioner of Customs having jurisdiction within a period
of thirty days of the expiry of period allowed for fulfilment of export obligation, or within such extended period as the said
Assistant Commissioner of Customs or Deputy Commissioner of Customs, may allow;
(xii) that the imported materials shall not be disposed of or utilised in any manner except for utilisation in discharge of export
obligation;
Provided that disposal of waste shall be allowed upto the limits specified in the standard input out-put norms mentioned in the
said hand book without payment of customs duty.
Provided further that disposal of waste arising in respect of resultant product not mentioned in the standard input output norms
in the said hand book shall be allowed without payment of Customs duty subject to verification by the said officer.
Provided also that imported materials which remain unutilised after the expiry of the export obligation period, shall be liable to
customs duty but for the exemption contained in this notification, together with interest at the rate of twenty four per cent per
annum from the date of clearance of the materials.
[(xiii) that the importer is registered with both the Central Excise Officer deputed for this purpose and the Electronics and
Software Export Promotion Council.]
Explanation. - In this notification, -
(i) "Licensing Authority" means the Director General of Foreign Trade appointed under section 6 of the Foreign Trade
(Development and Regulation) Act, 1992 (22 of 1992) or an officer authorised by him to grant a licence under the said Act;
(ii) "materials" means -
(a) raw materials, components, intermediates, consumables, computer software and parts required for manufacture of resultant
product specified in Part E of the said certificate.
(b) mandatory spares within a value limit of ten per cent of the value of said licence which are required to be exported along
with the resultant product; and
(c) packaging materials required for packing of resultant product.
THE SCHEDULE
ACTUAL USER DUTY EXEMPTION ENTITLEMENT CERTIFICATE
Part 1
(IMPORT) (This consists of ................... pages)
Sl. No..................... (IMP) Date of issue ....................
Port of Registration ........................
Issued to.................................................................
........................................................................................... (name and full address of
............................................................................................ the licencee)
Materials imported against licence No....... dated........ issued by.......... to the
above licencee and covered by the list of materials specified in list (a) of Part "C" of this certificate would be eligible for
exemption from customs duties subject to the conditions specified in the notification of the Government of India, Ministry of
Finance, Department of Revenue No .... Customs, dated the ......1998.
The importer shall discharge the export obligation in terms of the said notification within ....... months from the date of issue of
licence.
A Bond with security/surety in terms of the said notification, shall be executed before clearance of the goods from the Customs.
Signature
Seal of licensing authority
date
PART A
Names and addresses of the factories where the resultant products for export are manufactured.
PART B
Names and addresses of factories where the ancillaries to the resultant products for export are manufactured.
PART C
List of materials of import
(a) Materials to be imported under this certificate
Sl. No.Description of item of ImportQuantitySr. No. of the resultant products in Part E
1. 2. 3. 4.
(b) Other imported materials to be used in export product
Sl. No.DescriptionQuantity
1. 2. 3.
PART D
Particulars of import of materials
Sl.No.
Sl. No. of the materials
in Part C
Bill of Entry No. date and Customs
House of Import
Description technical
specifications and
Quantity and net
weight
1. 2. 3. 4. 5.
CIF Value
Duty
leviable but
for
exemption
Signature of the
Customs Officer with
Name, Designation and
seal
Heading No. of the First Schedule to the Customs Tariff Act, 1975
and Heading No. in the Schedule to the Central Excise Tariff Act,
1985 for levy of Additional Duty
Rate of Duty
Amount
of Duty
6. 7. 8. 9. 10.
(Part E and F figure in the Export Part of this DEEC)
PART G
Duties paid on materials in respect of which the conditions of said notification are not complied with
Sl.
No.
Sl. No. in Part D under which the import of the
materials has been entered
Description, Quantity and value of materials
on which duty paid
Rate of duty
leviable
(i) Basic
(ii) Additional
(iii) Others
1. 2. 3. 4.
Amount of
(i) Duty
(ii) Interest
Particulars of duty paying documentsSignature of the Customs Officer
5. 6. 7.
Actual User Duty Exemption Entitlement Certificate
PART 2
(EXPORT)
(This consists of........................ Pages)
Sl.No............(Exp) Date of issue ..........
Port of Registration ..............................
Issued to .................................................
........................................................................................... (name and full address of
.................................................................................................................... the licencee)
Materials imported against Licence No..........dated......... issued by...... to the
above licencee and covered by the list of materials specified in list (a) of Part "C of this certificate would be eligible for
exemption from customs duties subject to the conditions specified in the notification of the Government of India, Ministry of
Finance, Department of Revenue No.............Customs, dated the ......... 1998.
The licencee shall discharge the export obligation in terms of the said notification within ........... months from the date of issue of
licence.
A Bond with surety/security in terms of the said notification, shall be executed before clearances of the goods from the
customs.
Signature
Seal of licensing authority
date
PART A
Names and addresses of the factories where the Resultant products for export are manufactured.
PART B
Names and addresses of factories where the ancillaries to the resultant products for export are manufactured.
(Part C and D figure in the Imports part of this DEEC)
PART E
Resultant Products
Sl. No.DescriptionQuantitySl. No. of the materials in PartC
1. 2. 3. 4.
PART -F
Particulars of exports
Sl.
No.
S. No. of the resultant
product in PartE
Name of the Customs House
of shipment
Shipping Bill No.
and date
Name of the vessel and outward
entry of the vessel
1. 2. 3. 4. 5.
Quantity
Net weight of
the product
Description and technical
specification as per the Shipping
Bill
FOB value
in Rs./US $
Signature of Customs Officer with name,
designation and Seal and remarks if any
6. 7. 8. 9. 10.
PART H
Statement of imports and exports made
Details of imports made :
Sl.No.S. No. of PartCDescriptionQuantity importedCIF value in Rs./in equivalent US $
1. 2. 3. 4. 5.
Details of Exports made.
Sl.
No.
S. No. In Part EDescriptionQuantity exportedFOB value in Rs./in equivalent US $
1. 2. 3. 4. 5.
1. I/We hereby declare that information given in this statement is correct.
2. I/We hereby declare that no benefit under Rule 12(l)(b) of Rule 13(l)(b) of Central Excise Rules, 1944 has been availed in
respect of exports made under this DEEC.
Signature.......................
Name of the Signatory....
Designation...................
Full address..................
Certificate of Chartered Accountant/Cost Accountant
I have explained the applicant firm"s actual imports and exports as given above and find them as correct.
Signature...................
Seal..........................
Membership No.........
Certificate of the said officer (Designated Officer of the Department of Electronics)
I have verified the relevance/useability of the imported materials in the export product as well as the quantity required as given
above and certify that the imported materials have been utilised in the export product given in Part F of the said certificate
(Duty-Exemption Entitlement Certificate)
Signature......................
Name and designation....
and Seal........................
ANNEXURE
Account of materials imported for use in the manufacture of export products/resultant products
Sl.No.Date
Description of
imported
materials
received
Quantity
received
Particulars of GP 1/AR1/
Other approved document,
Bill of Entry No. and date
Name and Address of the
manufacturer/importer/stock-yard/ Private
Bonded Warehouse from whom the imported
materials received
1.2. 3. 4. 5. 6.
Range and Division/Custom House from
whose jurisdiction the imported materials
received
Issued for use in or in relation to the
manufacture of export product/ resultant
product
Description of the export
product/ resultant
product
Chit No. and date Quantity
7. 8. 9. 10.
Name of the Custom
House of export
Shipping Bill No.
and date
Re-export of defective imported materials, if any
on payment of duty
Balance Quantity
in stock
Shipping Bill and date Quantity No
11. 12. 13. 14. 15.
Central Excise Officer"s InitialsRemarks
16. 17.
Notification No. 77/98-Cus., dated 16-10-1998 corrected by Corrigendum F. No. 605/70/98-DBK, dated 21-10-1998 and as
amended by Notification No. 51/99-Cus., dated 29-4-1999 and No. 121/99-Cus., dated 4-11-1999, 120/2000 dated 15-09-
2000 and Notfn.No.30/2001 dated 12.03.2001.
