F.No. 305/6/94-FTT Dated 24/5/94
F.No. 305/6/94-FTT
Government of India
Ministry of Finance & Company Affairs
Department of Revenue
(Central Board of Excise and Customs)

Sub:- Clearance of goods manufactured by 100% EOU/EPZ units into DTA against an advance licence.

1. Certain references have been received in the Board's office from some of the Collectorates requesting for clarification regarding duty free clearance of goods manufactured in a 100% EOU/FTZ unit into the DTA against an advance licence and raising doubts about the legal backing for such clearances. It may be observed that Condition-7 of Paragraph I of Notification No. 13/81-Cus Dated 9/2/81 pertaining to 100% EOUs provides for clearances of the goods manufactured in a 100% EOU into the DTA in accordance with the EXIM Policy. DTA sales by EOU/FTZ units are covered by Para 102 of the Exim Policy; it has been further stated in Para 103 that supplies against advances licences shall be counted towards fulfillment of the export obligation. Therefore, 100% EOUs are permitted to sell the goods in the DTA against advance licences. Notification No. 13/81-Cus, provides for levy of appropriate duty on such clearances. However, such clearances against advance licences have been exempted in terms of Notification No. 82/92-CE dated 27/8/1992 subject to the conditions mentioned therein. In this background, it is felt that no further amendment of any customs or excise Notification is required for permitting duty free clearances from 100% EOUs against advance licences.