Stage -I - Definitions / Meanings / Overview
| Sl No | Particulars | Meanings / Definitions |
| 1 | AA Definition | Advance Authorisation / Advance License Scheme |
| 2 | AA Purpose | To get "Duty Free Imported Materials" viz Principle Raw Material, Additives, Consumables, Packing Material Jig & Tool to manufacture "Export Product" to make Indian Products so competitive in Global Market. |
| 3 | Benefits | All Duty-Free Scheme (including Anti-Dumping Duty & Safeguard Duty) |
| 4 | Obligation | Needs to fulfil "Export Obligation" by exporting "Finished Goods". Pre-Import condition is applicable for few Raw Items as listed in Appendix. |
| 5 | Stipulation - Import | 12 Months from AA Date (Only one revalidation for twelve months from expiry date shall be allowed) |
| 6 | Stipulation - Export | 18 Months from AA Date (1st EO Period Extn 6 Months & 2nd EO Period Extn another 6 months - Total 30 Months Max Export Validity) |
| 7 | Initial Cost / Financial Implication | Govt Fees for Advance Authorisation, Certification Charges for CA, Chartered Engineer, & Consultancy Fee (Service Charges) + 18% GST. |
| 8 | Liability | In case of non-fulfilment of Export Obligation (EO) within stipulated time, then require to pay Customs Duty Saved along with applicable Interest to Customs Dept. |
Stage -II - Pre-cautionary Measures require to adopt while applying for AA
| Sl No | Check Points |
| 1 | Figure out Import Item & Export Product Nomenclature duly mentioning technical specifications which is essentially required. |
| 2 | Classify both Imports Item and Export Products at appropriate ITC (HS) Codes before applying for AA. |
| 3 | Please do not mention lengthy Import Product Descriptions (do not keep Pre-fix / Suffix / Brand Name) which may lead to complications while monitoring / Final Closure of AA. |
| 4 | Apply AA only for sizable / reachable / achievable Export Obligation targets. |
| 5 | Generation of more and more AA may lead to confusion / errors / difficult for record-keeping / procedural lapses / timely non-filing of final closure applications to DGFT / more importantly cost burden. |
Stage -III - Import Procedure
| 1 | Register AA with concerned Customs Authority (Port of Import mentioned on AA) with executing general Bond (LUT) in prescribed form on ₹ 100 Stamp Paper duly notarised with or without BG. BG exemption, you may contact us. |
| 2 | Before filing of Bill of Entry (BE) with Customs, please ensure for the correctness of Import details viz Import Item Description, ITC (HS) Code, Qty, UOM, CIF Value (US$ / ₹) mentioned on AA. “Import Invoice Details” & “AA Import Details” should match. |
| 3 | Import the materials mentioned in AA and get Import clearance from Customs without payment of Customs Duty (All Duty Free) by ensuring proper AA details endorsement on Bill of Entry. |
| 4 | Bring the material to your Factory Address mentioned on AA to manufacture Export Product. |
Stage -IV – Export Procedure
| 1 | Manufacture Finished Products for Export purposes using Imported Material or material in stock (replenishment). This is applicable only where pre-import conditions are not applicable. |
| 2 | Execute Exports (Finished Product) duly mentioning Export Product, ITC (HS) Code, Qty, UOM, FOB Value (US$ / ₹), AA No & AA Date which should exactly be mentioned on AA on Export Documents viz Shipping Bill / Bill of Export / GST Invoice by opting Direct Export / Third Party / Export to SEZ / Deemed Export (Supplies to EOU, ICB Supplies, Supplies against Invalidation Letter / ARO). |
Stage -V - Post Export Procedure
| 1 | Apply for Export Obligation Discharge Certificate (EODC) after completion of Export Obligation. |
| 2 | On receipt of EODC, approach Customs for Bond Cancellation & BG Release. |
Stage -VI – Challenging Grounds / Critical Stages / Policy Relaxations Required in (AA) Scheme (Special Relaxations)
| 1 | Arrangement of Norms Fixation / Ratification / Adhoc Norms from DGFT Delhi |
| 2 | AA Revalidation for balance / left out import against AA |
| 3 | AA Export Obligation Period (EOP) Extension |
| 4 | AA Pre-Import Condition |
| 5 | AA Free Shipping Bills / Non-endorsement of AA No on Shipping Bill (SB) |
| 6 | Clubbing Provisions Relaxation in Advance Authorisation (AA) / Advance License Scheme (ALS) |
| 7 | Counting / Transfer of Excess Exports in Shipping Bills from One AA to another AA |
| 8 | Merger / De-merger / Amalgamation / Acquisition / Takeover / Outright Selling / Slump Sale |
| 9 | import Shipment Prior to AA issuance / obtainment |
| 10 | Consideration of SB after expiry Export Obligation Period (EOP) |
| 11 | Exports proceedings realised in INR for Nepal & Bhutan |
| 12 | Consideration of DBK SB against AA |
| 13 | Conversion of Free / DBK Shipping Bill into AA Shipping Bill |
| 14 | Export Obligation Period (EOP) beyond initial period expiry of EO - Special Relaxation |
| 15 | Removal of IEC from Denied Entity List (DEL) from RLA (Local DGFT) |
| 16 | 2nd (Second) AA Export Obligation Period (EOP) Extension (Special Relaxation) |
Our Suggestion
| 1 | Always better to Export first and then go for proportionate Import to avoid excess Import. |
| 2 | Keep close "Accountability" for Import & Export on daily basis (AA-wise) and compile the data for a quick AA-wise summary to restrict "Excess Import" and "Excess Export" against each AA. |
| 3 | Better to use / keep some kind of office tool (Customised Software) to keep Import & Export accountability atleast for Duty Exemption Schemes (AA) wherever sizable EXIM volume happening. |
| 4 | Always better to hire an "External Agency" to keep 2nd check of EXIM (Scheme related) transactions and also to validate EXIM Transaction documents. |
| 5 | Please reach us to get our expertise which will help you with proper Awareness, Guidance, Understanding & Quality Services to have leak proof mechanism to avoid unwanted financial implication on account of Penalty for late filing of Bill of Entry, Detention Charges & Demurrage Charges. |
EXIM (Import & Export) (DGFT / Customs / GST) Consultant for Import Export Related Matters
EXIM (Import & Export) Audit
EXIM (Import & Export) Awareness
EXIM (Import & Export) Orientation Programmes Virtual (Online) / Class Room Sessions
EXIM (Import & Export) (DGFT / Customs / GST) Consultant
EXIM (Import & Export) Consultation
EXIM (Import & Export) Retainership
Filing of Appeal for Order in Original (O-i-O), Show Cause Notice (SCN) Reply, Demand Notice reply, Export Obligation Monitoring (EOM) Reply, Directorate of Revenue Intelligence (DRI) Reply, Customs Audit Query Reply