The author has been directed to invite your attention to
notification Nos. 12/2012-Customs (S.No.507) and 12/2012-Central Excise (S.No.
337 and 338), both dated 17-03-2012, granting exemption from customs and excise
duties for provisional mega and ultra-mega power projects. One of the
conditions specified for availing of the said exemption is that the importer/project
developer furnishes a security in the form of a Fixed Deposit Receipt (FDR) or
Bank Guarantee from a Scheduled Bank for a term of 36 months or more for an
amount equal to the duty payable but for this exemption. This condition was
amended w.e.f 27-06-2012 when the importer/ project developer was given the
option of furnishing either FDR or Bank Guarantee from a Scheduled Bank.
2.
It
has been represented by the Association of Power Producers that the developers
should be allowed to secure release of the FDRs submitted by them prior to
27-06-2012 (i.e. date of DoR notifications) and the same should be substituted
with Bank Guarantees. The matter has been examined by the Ministry. It has been
felt that as long as a FDR was furnished as security, the FDR continued to
operate as security. If an importer/ developer wishes to replace the FDR by a
Bank Guarantee, the Bank Guarantee will operate from the date of replacement.
Since under the amended notifications, FDR and Bank Guarantee are considered equally
effective securities, it has been decided that there should not be any
difficulty in allowing the importer/ project developer to replace the FDR with
the Bank Guarantee.
3.
It
is requested that action may be taken accordingly to deal with such requests.
4. Difficulties, if any, faced in the
implementation of the instructions may be brought to the notice of the Ministry
at an early date.
Yours faithfully,
(P.K.Mohanty)
Joint Secretary (TRU)
Telephone:
011 23092687
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