“Write-off” of unrealised
export bills - Surrender of export incentives
A.P. (DIR Series) (2002-2003) Circular No. 61, dated 14-12-2002
Attention
of authorised dealers is invited to paragraph C.18 of A.P. (DIR Series)
Circular No.12 dated September 9, 2000 in terms of which they have been
permitted to allow “write-off” of unrealised export dues and A.P. (DIR Series)
Circular No.30 dated April 4, 2001 in terms of which authorised dealers have
been granted powers to permit “write-off” annually upto 5% of average annual
realisation to status holder exporters subject to certain conditions.
2. While
permitting “write-off” one of the conditions specified is that the export
benefits, if any, availed of by the exporter are surrendered. It has, however,
been brought to our notice that there were instances where exporters had not
surrendered export incentives in respect of export bills for which “write-off”
were permitted by their bankers.
3. With a view
to ensuring that exporters invariably surrender the export incentives in
respect of export bills for which they seek “write-off”, authorised dealers
should obtain document/s evidencing surrender of export incentives availed of
before permitting the relevant outstanding bills to be written off.
4. The
authorised dealers are advised to put in a place a system under which their
internal inspectors or auditors (including external auditors appointed by
authorised dealers) carry out random sample check/percentage check of
outstanding export bills written off.
5. The
authorised dealers may please note that the terms and conditions stipulated in
the circulars referred to above remain unchanged.
6. Authorised
dealers may bring the contents of the circular to the notice of their
constituents concerned.
7. The
directions contained in this circular have been issued under section 10(4) and
section 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999).