Replacement
Of Fixed Deposit Receipts (Fdrs) Furnished In Respect Of Provisional Mega Or
Ultra Mega Power Projects With Bank Guarantees (Bgs)
Circular
No. 2/2013-Customs, dated 1st January, 2013
As per notification
Nos. 12/2012-Customs (S.No.507)
and 12/2012-Central
Excise, 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.
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.
The Developers should be allowed to secure release
of the FDRs submitted by them prior to 27-06-20 12 and the same should be
substituted with Bank Guarantees.
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.
Regards
CA. Mona Singhal
Partner
Arpit Gupta & Associates
Chartered Accountants
701, Nirmal Tower,
26, Barakhamba Road,
Connaught Place, Delhi-110001
Mobile: +91-9873082769
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