(a) EOUs established anywhere in India and exporting 100% products except certain fixed percentage of sales in the Domestic Tariff Area (DTA) as may be permissible under the Policy.

(b) Units in Free Trade Zones in Special Economic Zones (SEZs) and exporting 100% of their products.

(c) EOUs set up in Software Technology Parks (STPs) and Electronic Hardware Technology Parks (EHTPs) of India for development of Software & Electronic Hardware.

The letter of permission for establishment of such EOUs under categories (a) to (b) is given by Development Commissioner Seepz SEZ at Andheri (E) in Mumbai for the units established in western zones, while for the units under category (c), the LOP is granted by Director, Software Technology Park of India, Vashi, Navi Mumbai after careful study of the feasibility of unit. The details of the policy may be obtained by visiting the STPI website at www.stpimumbai.net. After obtaining LOP, the unit has to approach Customs for obtaining the facilities of duty free import and excise - duty free procurement of indigenous goods of the raw material and capital goods required for the manufacture of finished products in Bonded warehouse u/s 58 & 65 of Customs Act, 1962 for the purpose of 100% export out of India.

For this purpose, the unit has to execute a Bond known as B-17 Bond which, inter adia, covers an undertaking by the unit to pay on demand an amount equal to the duty leviable on the goods imported duty free that are not proved to the satisfaction of the Asstt. Commissioner of Custom to have been used in the manufacture of articles for export. The value of Bond should be 25% of the amount of duty leviable on capital goods intended to be procured and on raw material to the held in stores for 6 months. The Bond is to the supported either by a surety for 100% of the value of Bond or by a Bank Guarantee for 5% of the value of Bond. The Bank Guarantee should be a continuing one.

The unit has to furnish following documents for applying to Deputy / Assistant Commissioner to grant a license of Customs Bonded warehouse and permission for manufacturing in Bonded warehouse u/s 58 & 65 of Customs Act, 1962.

List of documents required to be furnished are as follows:

1. Application for grant of licence u/s 58 & 65 of Customs Act, 1962
(Refer to format)
2. FORM B-17 Bond …….. (Refer to B - 17 bond format)
3. Bank Guarantee …… (Refer to B.G. format)
4. Insurance Policy for Fire & Burglary …… (For capital goods)
5. Supplementary Terms and Conditions
6. Affidavit with respect to non envolvement in Customs & Central Excise Cases (Refer to format given)
7. DoE/STPI letter of approval vide ref. no. ………………………..
8. List of proposed plant, machinery & capital goods
9. Agreement with STPI / SEEPZ for Export Commitment
10. Process of Manufacture
11. Green Card No……………………………………………………
12. Self Removal Procedure approval request letter
13. Solvency Certificate
14. List of Board of Directors
15. Lease Agreement of premises
16. Ground Plan of premises
17. IEC Certificate
18. PAN
19. Memorandum & Articles of Association

The specimen form for B-17 Bond and Bank Guarantee to be submitted by unit & its Banker are given as annexures ‘A’ & ‘B’.

For the purpose of renewal of licence, only following documents are required to be furnished -

1. Application for renewal in the prescribed Performa.
2. Solvency Certificate.
3. Export Statement.
4. B-17 Bond on Rs. 100/- Stamp Paper duly notarized irrespective of the fact whether the unit intended to make any import or not (if any enhancement of capital / indigenous goods limit or change of address)
5. Bank Guarantee (if earlier expired)
6. Supplementary terms and conditions duly accepted on Rs.100/- stamp paper duly notarized.
7. Lease Agreement duly registered with the area sub - register. (Stamps)
8. Declaration for customs.
9. Insurance Policy (for Fire / Burglary)

For the import of duty free capital goods or raw materials, unit has to make an application to Customs alongwith copy of invoice duly attested, packing list, Import certificate from STPI in case of STP, HTPI units, IGMS & Airway Bill or Bill of lading. The department will issue a serial numbered Procurement Certificate for duty free imported goods.

For procurement of duty free indigenous goods, purchase order & import certificate from STPI (in case of STP, HTPL units) is to be produced. The department will issue a CT-3 form to enable duty free procurement of indigenous goods.

The copies of above circular may be visited on following websites

www.cbec.gov.in
www.eximkey.com
www.ieport.com
www.taxindiaonline.com

or

On any reference book on Board’s Circulars.

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