DGFT POLICY CIRCULAR REGARDING BG AND LUT ON RESTRICTED ITEM

Government of India

Ministry of Commerce & Industry

Directorate General of Foreign Trade

Udyog Bhavan, New Delhi.

Policy Circular No. 39/2009-2014                             Dated 15^th July 2010

To,

All Regional Authorities;

Trade & Industry

Subject: Executiion of LUT/BG against Import Authorisation issued by import of Restricted Items on Re-export basis.

This refers to the Import Authorisation which are approved for import of restricted items on re-export basis by the EFC.  To ensure that goods are re-exported by the importers as declared by them at the time of application for Import Authorisations, it has been decided that Regional Authority (RA) concerned will take LUT/BG from the importers at the time of issuance of such authorization as per the following details:-

1.                   The status holders and manufacturers with a turnover of 5 Cr and above, shall execute only a LUT for the full import value.

2.                  Other importers, not covered by Sl.No. 1 above, shall excute LUT for the full import value along with a bank guarantee (BG) for a value of Rs. 1 lakh (one lakh Rupees).

3.                  LUT / BG should have a minimum validity for a time period covering the re-export time plus six months.

4.                  LUT/BG should be redeemded by RA as soon as the documentary evidence for re-export of goods is furnished by the importer.

5.                  This issues with the approval of Competent Authority.

(SHUBHRA)

Joint Director General of Foreign Trade

Tel. 011-23063249

(Issued from F.No.01/53/8/484/AM010/N-23/Import Cell)