Page 29 - Bullion World Volume 02 Issue 02 June 2022_Neat

Bullion World | Volume 2 | Issue 02 | June 2022
Customs EDI System (ICES).
However, for non-EDI Ports not
integrated with ICES, the TRQ
shall also be issued on Security
Paper.
- Imports against the TRQ shall
be allowed only upon debiting
electronically in the ICES system
or on debit as endorsed.
- The TRQ authorization for 7108
shall also contain the IEC of the
nominated agency/ Qualified
Jeweller for importing through
IIBX and GST Identification
Number (GSTIN) of the jewelry
manufacturer to whom TRQ is
issued. The said TRQ importer
should follow the procedure in
the Customs (Import of Goods
at Concessional Rate of Duty)
Rules, 2017.
Issues that need clarifications
a) Import under ITC HS 7108 falls
under the restricted list and c) The public notice dated
is permitted only through the
designated nominated agencies,
banks, or qualified jewellers. The
Ministry of Finance (Department
of Revenue) Notification No.
22/2022-Customs dated
30 April 2022 states in the
Annexure (condition 1) therein
that the "TRQ is allocated to the
importer."
However, the Public Notice No.
06/2022, dated 01.05.2022,
issued by the Ministry of
Commerce and Industry
(Department of Commerce),
states that the TRQ will
be allocated to a jewelry
manufacturer upon satisfying
the conditions imposed in
the said public notice. Thus,
it is evident that the importer
(exception being TRQ holders
who are also Qualified Jewellers)
shall be different from the TRQ
licensee, who will not be legally
empowered to effect the said
imports (7108) under the CEPA.
b) Notification No.
22/2022-Customs dated 30 April
2022–Annexure–Condition 2
(made applicable in the case of
imports under 7108) wherein it date to have been obtained
has been stated that – "importer fraudulently – will the liability for
follows the procedure set out in the differential customs duty rest
the Customs (Import of goods at on the nominated agency/license
concessional rate of duty) Rules holder.
2017 (CIGCRDR 2017)". Further,
Circular No.10/2021-Customs d) While the eligibility criteria for
dated 17.05.2021 (pertaining to jewellers have been provided,
the amendment of the said Rules subject to certain other
in 2021), wherein in Para 3.2, it qualifying conditions for import
is stated that sensitive sectors under UAE CEPA, there is
such as Gold, articles of jewelry, no specific definition given of
and other precious metals or 'jewellery manufacturer' in any
stones have been excluded of the circulars/notifications. A
from the facility of job work. It suitable definition of jewellery
disincentivizes the medium and manufacturers may be given to
small jewelry manufacturers avoid litigation in the future.
from availing of the benefit
and excludes the majority of Conclusion
domestic jewelry manufacturers Is there merit in excluding Gold
who will not be able to comply and other precious metals while
with the provisions of the said negotiating CEPA/ FTAs? The
rules. answer is probably 'yes.' On one
hand, India has taken some giant
steps toward reforming the bullion
01.05.2022 issued by the markets in India. However, the
Department of Commerce concessions provided under the
in the context of the UAE CEPA create market distortions that
CEPA imports contain the are sometimes counter-productive
conditions to be adhered to by to such initiatives. This is more so
the applicants for the issuance related to the gold itself because
of the TRQ license by the of its physical characteristics and
competent authority. However, with high duty structure in India.
the procedure that shall be The immediate impact can be seen
followed by the Ministry for in the working of domestic and
issuance of the said licenses international spot exchanges in
and other related issues has not India, which will struggle to achieve
been explained, viz., what will the objectives of uniform pricing
be the basis on which quantity and price discovery. Another sector
will be allocated to the different that is impacted and largely ignored
applicants, who will pay the TRQ while negotiating the bilateral and
license fees (importer or the TRQ multi-lateral trade agreements is
holder), can related party entities the domestic gold refining industry.
apply individually, will the same There was a hope of a boost in the
applicant be eligible to make refining industry after developing
multiple applications during gold spot exchanges; however,
a single-window period, what suddenly, the refiners will find
shall be the reasons that will themselves competing with the
warrant rejection of the license cheaper imported Gold. Another
application, which documents factor worth being cautious about
are required to be certified to is that duty concession on supplies
prove the eligibility criteria (or will from this agreement might result in
self-certification suffice?), What increased supplier premium resulting
verifications will the competent in increased dollar outgo, which is
authority carry out in the context certainly not the objective of signing
of the conditions to be satisfied these agreements.
viz., the issuance of the license,
if the license is found at a later
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