KARACHI: The Model Customs Collectorate of Exports has proposed certain amendments in Customs Rules, Customs Act to facilitate exporters in general and to discourage submission of fake and fictitious Form-E .
There have been instances of submission of fake and fictitious form-E and other documents. To seek legal backing for requisition of these documents under the Customs Act,1969, it is imperative that these documents may be specifically included in the definition of ‘documents’ so that submission of fake documents amongst these may cognizable to the offence of misdeclaration and fiscal frauds under section 32 and 32A of the Customs Act, 1969.
Whenever required under section 26(1)&(2) of the Customs; Act, 1969 the banks including financial institutions do not supply requisition documents and ask for specific courts of law’s orders. Besides, the importers/exporters whenever required in terms of notices under section 26(1) & (2) of the Customs Act, 1969 neither respond nor supply the requisitioned import/export/lawful purchase documents, required in the framing of seizure/contravention cases against them.
It is therefore proposed that every person, department, national or private bank including financial institution, company or organization should be obligated to furnish the information requisitioned by the Board or the appropriate officer within the time specified in the notice. Upon failure to respond to notice under section 25(1)(2) of the Customs Act, 1969, no documents in support of any claim of legal import or export etc. should be allowed to be submitted at any quasi-judicial & judicial fora.
An amendment in Section 32(2), Section 32A(2) and Section 32(3A) is proposed which is aimed to bring the offences relating to submission of fake form-E vis-a- vis non-repatriation of export proceeds/foreign remittances within the ambit of mis-declaration for taking cognizance thereof and issuance of show cause notice to the persons involved, irrespective of the fact that any evasion of duty or tax be involved in the matter. The existing provisions provide for issuance of show cause notice for the offence of mis-declaration, if any duty or tax is evaded.
The suggested amendment will make the culprits liable for penal action besides recovery of foreign remittances.
According to the proposals for the budget 2015-16, MCC Exports has proposed that the categorization of exporters was required under manual procedure of payment of duty drawback which has been replaced by the automated Customs Computerization System. The automated system has its own inbuilt profiling mechanism therefore the existing provisions of exporters categorization have become redundant under automated procedure and should be deleted.
It has been proposed that the DTRE applicants should be provided with the opportunity of appeals before next higher authority after their application is rejected by the regulatory collector.
MCC Exports has proposed that 100 percent quantity of inputs should be approved provisionally by the Regulatory Collector (against 25 percent presently) for acquisition purpose subject to the condition that the consumption of input goods should not exceed 50 per cent of the quantity of the DTRE approval till the input output ratio/wastage is determined by the IOCO/EDB. The DTRE user may export 50 percent quota before recommendation of IOCO/EDB is received and remaining after receipt thereof. This will enable the DTRE users to meet their export orders in time.
The period of 30 months was prescribed when the utilization period of DTRE approval under rule 305 was twenty-four month. The utilization period has been reduced to 12 months. Therefore, corresponding reduction in the validity of financial securities is also required. The amounts suspended by the Regulatory Collector in respect of leviable customs duties, excise duty, sales tax and withholding tax should be secured for a period of eighteen months against bank guarantee, corporate guarantee or indemnity bond with a PD cheque.
The samples of DTRE import and export consignments cannot be drawn where the consignments are cleared by Customs Computerized System (We8OC) under Green and Yellow Channels. The existing provisions of Rule 302A remain un-complied with under automation of customs procedure. The scope of rule 302A needs to be confined in cases the consignments are cleared under Red Channel so as to ensure implementation of law invariably.
The Regulatory Collector and Chief Collector may be empowered to grant extension in utilization period. Extension upto six months on payment of 1% surcharge per month on C&F value of the input goods for which extension is sought may be granted by Regulatory Collector and further extension beyond six months by the Chief Collector. This proposal is meant for providing facilitation to the exporters and mitigate the problems of exporters at Collectorate’s level and reduce the workload of FBR in routine matters.
Type of Goods Declaration is required to be prescribed in the rules as there exists divergent practice in the collectorates supervising import clearances.
The input goods may be imported by the licensee without payment of customs duty, sales tax and federal excise duty after declaring on the IB type goods declaration that such input goods are being imported for export oriented unit for manufacture of export goods.
The amounts of customs duty, sales tax and federal excise duty involved on clearance of imported input goods should be secured by the Collector of the importing station against indemnity bond and post-dated cheque.
SRO 327(I)/2008 compels a local supplier to issue a zero rated invoice to the licensee of export oriented unit whereas corresponding provisions are not available in the Sales Tax Act, 1990 authorizing the local supplier to supply goods against zero-rated invoices.
Consequently, the licensee is constrained to purchase input goods from local market on payment of sales tax. Therefore, provisions for procurement of inputs on payment of sales tax may be incorported in the EOU Rules with consequential refund/adjustment facility.
It has been proposed that the retention period of replacement parts should be five years and consumable spares parts upto two years from the date of importation provided that such replacement parts and consumable parts are either destroyed or leviable duty/taxes is paid at appraised value.