As per Handbook of Procedures 1st April 2002 - 31st March 2007 (Chapter - 4)  : 

Policy
4.1
The policy relating to the Duty Exemption/Remission Scheme is

prescribed in Chapter 4 of the Policy.
General provision
4.2
An application for grant of an Advance Licence/DFRC/ DEPB may

be made by the Registered office or Head office or a branch office or manufacturing unit of the eligible exporter, to the licensing authority concerned.

4.3
Where the applicant is the branch office or manufacturing unit(s)

of an exporter, it shall furnish (a) Self certified copy of valid RCMC where the name of the branch office or manufacturing unit is given and (b) an authority letter from the Registered Office of a Company or Head Office of a firm, clearly indicating that Registered/Head Office or its branches and manufacturing unit(s) have not been declared defaulter or otherwise made ineligible for import/ export under any of the provisions of the Policy. However, this declaration shall not be required for those filing applications electronically.
Advance Licence
4.4
Where the SION have been published, an application in Appendix-

10B, along with documents prescribed therein, shall be submitted to the licensing authority concerned.

4.4.1
In case of export of gold/silver/platinum jewellery and articles

thereof, the quantity, wastage and the value addition norms shall be as prescribed in Chapter-4 of the Policy and this chapter.
4.4.2
In case where norms have not been published, an application in

Appendix-10B (with Annexure-I), alongwith prescribed documents, shall be furnished to ALC for fixation of Norms. In such cases, the original copy of the application along with prescribed fee shall be filed with the Regional Licensing Authority concerned and a self attested copy of the same shall be filed with ALC. The Licences in such cases shall be issued by the RLA on the basis of recommendation of ALC.
The Committee shall also function as a recommendatory authority for SION. The Director General of Foreign Trade may notify such norms as recommended by the ALC.
4.4.3
Applications, where Acetic Anhydride, Ephedrine and Pseudo-

ephedrine is required as an input for import, either in such cases where norms are fixed or in such cases where norms are not fixed, shall be filed with the regional licensing authorities concerned.
Copies of such applications shall also be simultaneously endorsed to the Drug Controller of India, Nirman Bhawan, New Delhi, Narcotics Commissioner, Central Bureau of Narcotics, Gwalior. and the respective Zonal Director of the Narcotics Control Bureau, alongwith a declaration that the applicant will maintain the prescribed records and also submit the prescribed returns.
4.4.4
The licensing authority, while issuing the advance licence for the

import of Acetic Anhydride, Ephedrine and Pseudo- ephedrine, shall endorse a condition that before effecting imports, NOC shall be obtained from the Narcotics Commissioner of India, Central Bureau of Narcotics, Gwalior and shall also endorse a copy of the licence to the Drug Controller, Nirman Bhawan, New Delhi and the concerned Zonal Director of the Narcotics Control Bureau.
Advance Licence for free of cost and paid material
4.5
In terms of paragraph 4.1.6 of the EXIM Policy, an exporter may

apply for an Advance Licence for import of items mentioned in paragraph 4.1.1 of the Policy some of which may also include items that are supplied free of cost.
Newcomers
4.6
In the case of newcomers, who have not exported in each of the

preceding three licensing years, the Advance Licence shall be issued subject to furnishing 100% BG to Customs authority to cover exemption from Customs duty together with 15% interest. Specific endorsement to this effect shall be made in the licence by the licensing authority.
Self Declared Licences where SION do not exist
4.7
The licensing authority may also issue Advance licences, where

SION are not fixed, based on self declaration and an undertaking by the applicant for a final adjustment as per Adhoc/SION fixed by ALC. However, no Advance Licence for import of horn, hoof and other organ of animal, or for any item for which DGFT may so notify, shall be issued under paragraph 4.7 by the licensing authority.
Entitlement
4.7.1
The CIF value of one or more such licences shall be Rs.50 lakhs

or 100% of the FOB and/or F.O.R value of preceding year exports/supply, whichever is more. However Export House/ Trading House/Star Trading House/Super Star Trading House can claim one or more such licences upto 200% of the FOB value of preceding year exports.
The new comers shall also be entitled for licences in this category upto their entitlement or for a CIF value not exceeding Rs.50 lakhs, whichever is more, subject to furnishing of 100% Bank Guarantee to Customs authority to cover the exemption from Customs duties together with 15% interest. A specific endorsement to this effect shall be made on the licence.

4.7.2
Once the norms are fixed by ALC, the value limits mentioned in
 
sub paragraph 4.7.1, above would not be applicable to advance licences issued under this paragraph. Such licences, subsequent to fixation of norms by ALC, may be enhanced to a value originally applied for or as decided by the competent authority.
Licence in excess of entitlement
4.7.3
An applicant including a newcomer shall be entitled for licence

under this paragraph in excess of entitlement mentioned in paragraph 4.7.1 subject to furnishing of 100% Bank Guarantee to Customs authority to cover the exemption from Customs duties. A specific endorsement to this effect shall be made on the licence.

4.7.4
The original application with prescribed documents shall be

submitted to the concerned Regional Licensing Authority. The licensing authority shall forward a copy of the application within 7 days from the date of issue of such licences to ALC for fixation of norms within the prescribed time.
4.7.5
The applicant shall give an undertaking that he shall abide by the

norms fixed by ALC and accordingly pay duty, together with 15% interest, on the unutilised inputs as per norms fixed by ALC.

4.7.6
In such cases, where the norms are not finalised by ALC within six

months from the date of issuance of licence, the norms as applied for shall be treated as final and no adjustment will be made. However, where the application for fixation of adhoc/SION is rejected on account of non-furnishing of required documents/ information, the licence holder shall be liable for penalty as stated in the above paragraph. In such cases where the export obligation is completed pending fixation of norms by ALC, the entitlement for the licence as given in paragraph 4.7.1 may be re-credited upon production of documentary evidence showing fulfillment of export obligation and realisation of foreign exchange in respect of the previous licences. However, bond waiver/ redemption shall not be allowed pending fixation of norms in such cases.
Financial Powers
4.8
The financial powers of the licensing authorities and ALC are given

in the table below:
Category of Application
On published norms and under paragraph- 4.7 of this Handbook

CIF Value upto Rs. 50 Crore
CIF value above Rs.50 crore
Issuing Authority for Advance Licence
Regional Licensing Authority
Regional Licensing Authorities on the recommendation of ALC.
Standardisation of Adhoc Norms
4.9
For standardisation of norms, an application may be made by the

manufacturer exporter or merchant-exporter, tied to supporting manufacturer, duly filled in with complete data. Such applications shall be made to the Advance Licensing Committee (ALC) in the form given in Appendix-10.
Import of fuel may also be allowed under SION by ALC subject to the following -
(a) The facility of import of fuel under SION shall be allowed only to the manufacturer having captive power plant.
(b) Fuel should be allowed only under SION and in no case should it be allowed either under paragraph 4.7 or under ad-hoc norms.
(c) Fuel should be allowed only against an actual user licence and therefore, fuel shall not be allowed for imports against DFRC, which is transferable in nature.
(d) Even where fuel is included as an input under SION, it shall not be taken into account while fixing the DEPB rate for such products against which fuel has been allowed as an input.
Modification of SION
4.10
An application for modification of existing SION may be filed by

manufacturer exporter or merchant-exporter, tied to supporting manufacturer, in the form given in Appendix-10 to the ALC.
Description of an Advance Licence
4.11
An Advance Licence shall specify:

(a) the names and description of items to be imported and exported/supplied;
(b) the quantity of each item to be imported or wherever the quantity cannot be indicated, the value of the item shall be indicated. However, if in Standard input output norms, the quantity and value of individual inputs is a limiting factor, the same shall be applicable.
(c) the aggregate CIF value of imports; and
(d) the FOB/ FOR value and quantity of exports/ supplies
Exports in Anticipation of Licence
4.12
Exports/supplies made from the date of receipt of an application

for an Advance Licence by the licensing authority, may be accepted towards discharge of export obligation. If the application is approved, the licence shall be issued based on the input/output norms in force on the date of receipt of the application by the licensing authority in proportion to the provisional exports/ supplies already made till any amendment in the norms is notified. For the remaining exports, the Policy/ Procedures in force on the date of issue of the licence shall be applicable.

4.12.1
The exports/supplies made in anticipation of the grant of an

Advance Licence shall be entirely on the risk and responsibility of the exporter.
4.12.2
The conversion of duty free shipping bills to drawback shipping

bills may also be permitted by the customs authorities in case the application for an Advance Licence is rejected or modified by the licensing authority.

Note:
Advance Licence, unless otherwise stated, means Advance Licence

for Physical Exports/ Intermediate Supply/ Deemed Exports.
Advance Licence for Intermediate Supplies
4.13
The application for grant of Advance Licence for Intermediate

supply may be made on the basis of a tie-up agreement with the exporter holding an Advance licence for physical exports/deemed exports. Such requests shall be considered by the licensing authority concerned. The Advance Licence for Intermediate supply shall be issued after making the licence invalid for direct import of items to be supplied by the intermediate manufacturer. In such cases, a copy of the invalidation letter will be given to the licence holder and copy thereof will be sent to the intermediate supplier as well as the licensing authority of the intermediate supplier. The licensee in such case has an option either to supply the intermediate product to holder of Advance Licence for physical exports/deemed exports or to export directly. The facility of advance licence for intermediate supply shall be available even in cases where the intermediate supplier has supplied or intend to supply the material subsequent to fulfilment of export obligation by the ultimate exporter holding the Advance Licence.
Advance Release Order
4.14
The application for grant of Advance Licence for Intermediate

An application may be made to the Regional Licensing Authority concerned for grant of Advance Release Order (ARO) to procure the inputs from indigenous sources/State Trading Enterprise/EOUs/EPZ/SEZ/EHTP/ STP units.

4.14.1
The application shall specify (i) the name, description and quantity
 
of the items and (ii) the individual value of items to be procured. An ARO may be issued along with the Advance Licence for Physical Exports/Deemed Exports/DFRC or subsequently, and its validity shall be co-terminus with the validity of the Advance Licence for Physical Exports/ Deemed Exports. An ARO issued for the procurement of an individual item shall be automatically valid for procurement from one or more indigenous sources.
Back to Back Inland Letter of Credit (LC)
4.15
The exporter may alternatively avail the facility of a back to back

inland letter of credit from the banks. An Advance Licence holder, except for an intermediate supply and DFRC holder, may approach a bank for opening an inland letter of credit (LC) in favour of an indigenous supplier.

4.15.1
Before opening the LC, the bank will ensure that the necessary
 
BG/LUT has been executed by the Advance Licence holder and an endorsement to that effect has been made on the licence. However, execution of BG/LUT shall not be required against DFRC. After opening the inland LC, the bank shall make the following endorsement on the Exchange Control and Customs copy of the Advance Licence for Physical Exports/Deemed Exports/DFRC;
RThe value of this Advance Licence for Physical Exports/ Deemed Exports/ DFRC stands reduced by a sum of Rs. ________ , being the value of the inland LC No.________ opened today by the licensee in favour of M/s ____________________ (name and address of the indigenous supplier).

4.15.2
The licence shall be invalidated by the bank for direct import only

in respect of the full quantity and value of the item being sourced indigenously.

4.15.3
The original Letter of credit (LC) may be retained by the bank for

negotiation and only the non-negotiable copy of the LC may be given to the indigenous supplier.

4.15.4
The responsibility of the bank shall be confined to making the

endorsement. The bank shall not be liable for any misrepresentation or false statement made by the licensee while requesting the bank to make the endorsement. The inland LC opened by the bank in favour of the indigenous supplier shall not be canceled for any reason whatsoever.

4.15.5
The non negotiable copy of inland LC together with the photocopy

of the Advance Licence duly carrying endorsements made by the bank shall be sufficient for the indigenous supplier to claim deemed export benefits. LC issued against DFRC shall, however, be entitled only to benefit given in paragraph 8.3(b) of Policy, whereas LC for other categories shall be entitled to benefits given in paragraph 8.3 (b) and (c) of the Policy.

4.15.6
Where the import of gold/silver is permitted as an input under this

scheme, such gold/silver can be sourced through the nominated agencies as given in Chapter-4 of the Policy for supply against the Advance Licences issued in this behalf. Before supply of the material, the nominated agencies should follow the same procedure as given in paragraph 4.13 above.
Facility Of Supporting Manufactures
4.16
The licence holder has the option to have the material processed

through any other manufacturer including a jobber. However, the licence holder shall be solely responsible for the imported items and fulfillment of export obligation.
Facility Of Co-Licensee
4.17
If the applicant desires to have the name of any manufacturer or

jobber added to the licence, he may apply for such endorsement. Such endorsement shall be mandatory where prior import before export is a condition for Advance Licence for physical exports and the licence holder desires to have the material processed through any other manufacturer or jobber.
Upon such endorsement made by the licensing authority, the licence holder and co-licensees shall jointly and severally be liable for completion of export obligation. Any one of the co-licensees may import the goods in his name or in the joint names. The BG/LUT shall also be furnished in their joint names.
Acceptance of BG / LUT
4.18
At the time of issue of the licence, the acceptance of the

undertaking given by the applicant to the licensing authority concerned in the form given in Appendix-10B will be endorsed on the reverse of the Advance Licence.
Note :
(a) No BG/LUT will be required where the specified export obligation

has been fulfilled before making any import. In case of partial fulfillment of export obligation before effecting any imports, the BG/ LUT may be reduced proportionately. The licence holder shall also produce EP copy of the shipping bills and Bank Certificate of Export and Realisation, and a statement of exports giving details of shipping bill wise exports indicating the shipping bill number, date, FOB value as per shipping bill and description of export product substantiating the completion or the partial fulfillment of the export obligation to the licensing authority concerned.
(b) In respect of an advance licence on which "No BG/LUT" facility has been provided, the licensing authority shall forward a copy of the “No Bond Certificate” indicating the shipping bill number, date, FOB value as per shipping bill and description of export product, in respect of shipment which were taken into account for calculating fulfilment of export obligation to the customs authorities with whom the licence is/required to be registered. Before allowing the imports against Advance Licence, the Customs shall verify that the details of the exports as given in the “No Bond Certificate” are as per their records.
Port Of Registration
4.19
The licence and the Advance Licence shall be issued for the purpose

of import and export through one of the sea ports or airports or ICDs or LCS specified below. The licence holder shall register the licence, the port specified in the licence and thereafter all imports against the said licence shall be made only through that port, unless he obtains permission from the customs authority concerned to import through any other specified port. However, exports may be made through any of the specified ports.
Sea Ports :-
Mumbai, Kolkata, Cochin, Kakinada, Kandla, Mangalore, Marmagoa, Chennai, Nhavasheva, Paradeep, Pipavav, Sikka, Tuticorin Vishakhapatnam, Dahej, Nagapattinam, Okha, Mundhra and Surat (Magdalla),
Air-ports :-
Ahmedabad, Bangalore, Bhubaneshwar Mumbai, Kolkata Coimbatore Air Cargo Complex, Cochin, Delhi, Hyderabad, Jaipur, Srinagar, Trivandrum, Varanasi, Nagpur and Chennai. ICDs:- Agra, Bangalore, Coimbatore, Delhi, Faridabad, Gauhati (Amingaon), Guntur, Hyderabad, Jaipur, Jallandhar, Kanpur, Ludhiana, Moradabad, Nagpur, Pimpri (Pune), Pitampur (Indore), Surat, Tirupur, Varanasi, Nasik, Rudrapur(Nainital), Dighi (Pune), Vadodara, Daulatabad, (Wanjarwadi and Maliwada), Waluj (Aurangabad), Anaparthy, Salem Mallanpur, Singanalur, Jodhpur, Kota, Udaipur, Ahmedabad, Bhiwadi, Madurai, Bhilwara, Pondicherry and Garhi Harsaru.
LCS :-
Ranaghat and Singhabad

4.19.1
The Commissioner of Customs may, either by a public notice or on

the written request of the licence holder, by a special order and subject to such conditions as may be specified by him, also permit imports and exports from any seaport/airport/ICD or land custom station other than those mentioned above.

4.19.2
In such cases, where the licence has not been registered at the

port specified in the licence and no import has taken place, the request for change in the Port of Registration may be considered by the licensing authority concerned provided the licence has not been redeemed.

4.19.3
For imports from the Airport/Seaport/ICD other than the port of

registration, a Telegraphic Release Advice(TRA) shall also be issued by the customs authority at the port of registration to the customs authority at the port of import.
Facility of Clubbing
4.20
The accountability of imports and exports shall be restricted in

relation to the individual categories of advance licences issued under this scheme.

4.20.1
The regional licensing authority, under whose jurisdiction the

licence is issued or ALC in other cases, may also consider a request for clubbing all imports and exports of more than one Advance Licence (clubbing of all Advance Licence for physical exports or clubbing of all Advance Licence for Intermediate supplies or clubbing of all Advance Licence for deemed exports) provided the imported inputs are properly accounted for as per norms. The value addition of the licences so clubbed shall be the average of the value addition imposed on individual licences. Upon clubbing, the licences shall, for all purposes, be deemed to be one licence.

4.20.2
The facility of clubbing shall be available only for

redemption/regularisation of the cases and no further import or export shall be allowed. For this facility, licences are required to have been issued under similar Customs notification.

4.20.3
In case an Advance Licence(s), where export obligation has already

expired, is to be clubbed with an Advance Licence(s) where export obligation period is valid, the applicant shall pay the composition fee of 1% or 5%, as the case may be, prescribed for extension of export obligation in respect of Advance Licence(s) where export obligation period has expired.

4.20.4
In such cases, the exports effected 30 months after the issuance of

the expired licence shall not be considered for clubbing.
Enhancement / Reduction In the Value of Licence
4.21
In respect of an Advance Licence, the licensing authority concerned

(as per their financial powers) may consider a request for enhancement/ reduction in the CIF value of the licence, provided the value addition after such enhancement does not fall below the stipulated minimum value addition and provided there is no change in the input-output norms and the Policy under which the licence was issued.

4.21.1
The licensing authority concerned (as per their financial powers)

may also consider the request for enhancement/ reduction in CIF value, quantity of inputs, FOB value of export obligation and quantity of exports of an advance licence provided there is no change in the input output norms and value addition after such enhancement does not fall below the stipulated minimum value addition.

4.21.2
The request for prorata enhancement in value and quantity may be

made either before or after exports. In such cases where there is a change in the SION prior to the export of the said product, the prorata enhancement shall be given after calculating the entitlement on the revised SION.
Export Obligation Period and its Extension
4.22
The period of fulfillment export obligation under an Advance Licence

shall commence from the date of issuance of licence. The export obligation shall be fulfilled within a period of 18 months except in the case of supplies under Advance Licence for Deemed Exports/Advance Licence to the projects/turnkey projects in India/ abroad where the export obligation must be fulfilled during the contracted duration of execution of the project/ turnkey project.

4.22.1
The request for extension in export obligation period may be made

in the form given in Appendix-10G. The regional licensing authority shall grant one extension for a period of six months from the date of expiry of the original export obligation period to the licensee subject to payment of composition fee of 1% of the unfulfilled FOB value of export obligation with reference to CIF value of imports made for which extension is being sought. Request for further extension may be considered by the regional licensing authorities subject to payment of composition fee of 5% of the unfulfilled FOB value of export obligation with reference to the CIF value of imports made for which extension is being sought. Such extension shall however not exceed a period of six months from the date of expiry of earlier extension.

4.22.2
The Customs may allow provisional clearance of export

consignment as and when the licence holder produces documentary evidence of having applied for EO extension to the concerned RLA provided the shipments are effected within 30 months from the date of issuance of licence.
Revalidation Of Licence
4.23
The regional licensing authority may consider a request of the

original licence holder and grant one revalidation for a period of six months from the date of expiry of the original licence. Request for further revalidation may be considered by the regional licensing authorities. However, such revalidation shall not exceed a period of six months from the date of expiry of earlier period of revalidation. The request(s) for revalidation of licence shall be made in the form given in Appendix-10G
Monitoring Of Obligation
4.24
The licensing authority, with whom the Undertaking is executed by

the Advance Licence holder, shall maintain a proper record in a master register indicating the starting and closing dates of obligation period and other particulars to monitor the export obligation. Within two months from the date of expiry of the period of obligation, the licence holder shall submit requisite evidence in discharge of the export obligation in accordance with paragraph 4.25 of the Handbook. However, in respect of shipments where six months period for realisation of foreign exchange has not become due, the licensing authority shall not take action for non submission of bank certificate of exports and realisation provided the other document substantiating fulfillment of EO have been furnished.

4.24.1
In case the licence holder fails to complete the export obligation or

fails to submit the relevant information/ documents, the licensing authority shall take action by refusing further licences, shall enforce the condition of the licence and Undertaking and shall also initiate penal action as per law.
Fulfillment Of Export Obligation
4.25
The licence holder shall furnish the following documents in support

of having fulfilled the export obligation:-
For physical exports:-
(i) Bank Certificate of Exports and Realisation in the form given at Appendix-22
However, realisation of export proceeds shall not be insisted if the shipments are made against confirmed irrevocable letter of credit and the same is certified by the bank in column 14/15 of Appendix- 22.
(ii) EP copy of the shipping bill(s) containing details of shipment effected.
(iii) A statement of exports giving details of shipping bill wise exports indicating the shipping bill number, date, FOB value as per shipping bill and description of export product
(iv) A statement of imports indicating bill of entry wise item of imports, quantity of imports and its CIF value.
For deemed exports
(i) A copy of the invoice duly signed by the unit receiving the material and their jurisdictional excise authorities certifying the item of supply, its quantity, value and date of such supply.
(ii) Payment certificate from the project authority in the form given in Appendix-12A. In the case of Advance Licence for Intermediate Supplies/ deemed exports, supplies to the EPZs/EOUs/SEZs/EHTPs/STPs, documentary evidence from the bank substantiating the realisation of proceeds from the Licence holder or EOUs/ SEZs/ EPZs/ EHTPs/STPs, as the case may be, through the normal banking channel, shall be furnished in the form given at Appendix- 22A.
Redemption
4.26
In case the export obligation has been fulfilled, the licensing

authority shall redeem the case. After redemption, the licensing authority shall forward a copy of the redemption letter indicating the shipping bill number(s), date(s), FOB value in Indian rupees as per shipping bill(s) and description of export product to the Customs authority at the port of registration. Before discharging BG/LUT against the Advance Licence, the Customs shall verify that the details of the exports as given in the “Redemption Certificate” are as per their records.
Ordinarily, redemption of LUT shall not preclude the customs authority from taking action against the licence holder for any misrepresentation, mis-declaration and default detected subsequently.
Transitional Arrangement for licences issued upto 31.3.2002
4.27
The Advance Licence including Advance Licence for Annual

Requirement issued upto 31.3.2002 shall be governed by the provisions contained in Chapter-7 of the Handbook (Vol.1) (RE-2001).
Transitional Arrangement for licences issued upto 31.3.2002
4.28
The cases of a bonafide default in fulfillment of export obligation

may be regularised by the licensing authority in the manner indicated below

i) If the export obligation is fulfilled in terms of value, but there is a shortfall in terms of quantity, the licence holder shall, for the regularisation, pay:-


(a) To the customs authority, customs duty on the unutilised value of the imported material alongwith interest at the rate of 15% per annum thereon; and
(b) An amount equivalent to 3% of the CIF value of unutilised imported material through a TR in the authorised branch of central bank of India indicating the “Head Account: 1453, Foreign trade and export promotion and minor head 102”. However, the provisions of this sub paragraph shall not be applicable if the unutilised imported material was freely importable on the date of import.

(ii) If the export obligation is fulfilled in terms of quantity but there is shortfall in terms of value, no penalty shall be imposed if the licence holder has achieved the positive value addition. However, if the value addition falls below positive, the licence holder shall be required to deposit an equivalent amount through TR in the authorised branch of Central Bank of India indicating the “Head of Account-1453 Foreign Trade and Export Promotion- Minor Head –102” so that the 100 times the deposited amount and the FOB value realised in Indian rupees together account for positive value addition over the CIF value.
(iii) If the export obligation is not fulfilled both in terms of quantity and value, the licence holder shall, for the regularisation, pay as per (i) and (ii) above.
(iv) In case an exporter is unable to complete the export obligation undertaken in full and he has not made any import under the licence, the licence holder will also have an option to get the licence cancelled and apply for drawback after obtaining permission from the Customs authorities for conversion of shipping bills to Drawback Shipping Bills.
Time Period For Depositing Fines, Customs Duty, Etc.
4.29
The customs duty with interest to be recovered from the licencee on

account of regularisation or enforcement of BG/LUT, as the case may be, shall be deposited by the licence holder in relevant Head of Account of Customs Revenue i.e. “Major Head 0037 - Customs and minor head 001- Import Duties in prescribed T.R. Challan within 30 days of the demand raised by the licensing/customs authority and documentary evidence shall be produced to this effect to the licencing/customs authority immediately. On receipt of such documentary evidence from the licence holder, the licensing authority shall intimate the details of the recovery/ deposits made to the customs authority at the port of registration under intimation to Joint Secretary (Drawback), Department of Revenue, Ministry of Finance, Jeevan Deep Building, New Delhi.
The payment of amount of duty, interest and any dues for regularisation shall, however, be without prejudice to any other action that may be taken by the customs authorities at any stage under the Customs Act, 1962.
Maintenance of Proper Account
4.30
Every licence holder shall maintain a true and proper account of

licence-wise consumption and utilisation of imported goods in Appendix-21. Such records should be preserved for a period of at least three years from the date of redemption.
Duty Free Replenishment Certificate
4.31
The Policy of Duty Free Replenishment Certificate is given in

paragraph 4.2 of the Policy. The exporter exporting under DFRC shall be required to give a declaration in the EP copy of the Shipping Bill indicating the serial number and product group of SION of the export product.
Export / Imports under DFRC
4.32
Export shipments under DFRC can be effected from any port

mentioned in paragraph 4.19 of the Handbook. The DFRC shall be issued with single port of registration, which will be the port from where the exports have been effected. However for import from a port other then the port of export, TRA shall be issued by the Customs authority at the port of export to the Customs authority to the port of import.
Filing of Application
4.33
An application for grant of DFRC may be made to the licensing

authority concerned in the form given in Appendix-10-D alongwith the documents prescribed therein. An application for DFRC shall be filed only after realisation of export proceeds. However, in case of exports against irrevocable Letter of Credit, application may be filed after exports. The CIF value of DFRC shall be arrived at after discounting 25% from the FOB value of exports. The FOB value shall be calculated on the basis of the Bank Realisation Certificate.
Time Period
4.34
The application for DFRC shall be filed within six months from the

date of realisation reckoned from the last date of realisation in respect of shipments for which DFRC is being claimed.

4.34.1
In case of exports against irrevocable Letter of Credit, the DFRC

shall be filed within six months from the date of exports reckoned from the last date of exports in respect of shipments for which DFRC is being claimed.
4.34.2
For exports against advance payment, DFRC shall be filed within six

months from the date of exports against advance payment.

4.34.3
Wherever provisional shipment has been allowed by the customs

authorities, DFRC against such exports shall be issued only after the release of the shipping bill by the Customs. The time limit for filing of application in such cases shall be six months from the date of release of shipping bill or three months from date of realisation, whichever is later.
Frequency of Application
4.35
The applicant shall file one application relating to one export

product group from one port of export. Where export product falling under one product group have been exported from different ports, the exporter shall file more than one application for the same export product group .
Verification by Customs
4.36
The licensing authority shall ensure that while issuing the DFRC, the

Shipping Bill no(s) and date(s), FOB value in Indian rupees as per Shipping Bill(s) and description of export product are endorsed on the reverse of DFRC. Before allowing the imports against DFRC, the Customs shall verify that the details of the exports as given on the DFRC are as per their records.