FOREIGN TRADE (REGULATION) RULES, 1993
Ministry of
Commerce
Notification No. GSR 791 (E), dated 30-12-1993
In exercise of the powers conferred by Section 19 of the
Foreign Trade (Development and Regulation) Act, 1992 (22 of
1992), the Central Government hereby makes the following rules,
namely:-
1. Short title and commencement.- (1) These
rules may be called the Foreign Trade (Regulation) Rules, 1993.
(2) They shall come into force on the date of their
publication in the Official Gazette.
2. Definitions.- In these rules unless the
context otherwise requires, -
(a) "Act" means the Foreign Trade (Development and
Regulation) Act, 1992 (22 of 1992);
(b) "charitable purpose" includes relief of the poor,
education, medical relief and the advancement of any other object
of general public utility;
(c) "importer" or "exporter" means a person who imports or
exports goods and holds a valid Importer-exporter Code Number
granted under section 7;
(d) "licensing authority" means an authority authorised by
the Director General under sub-section (2) of section 9 to grant
or renew a licence under these rules;
(e) "Policy" means the export and import Policy formulated
and announced by the Central Government under section 5;
(f) "schedule" means a Schedule appended to these rules;
(g) "section" means a section of the Act;
(h) "special licence" means a licence granted under
sub-section (2) of section 8;
(i) "value" has the meaning assigned to it in clause (41)
of section 2 of the Customs Act, 1962 (52 of 1962);
(j) words and expression used in these rules and not
defined but defined in the Act shall have the meanings
respectively assigned to them in the Act.
3. Grant of special licence.- (1) Where the
Importer-exporter Code Number granted to any person has been
suspended or cancelled under sub-section (1) of section 8, the
Director General may, having regard to the following factors,
grant to him a special licence, namely:-
(1) that the denial of a special licence is likely to affect the
foreign trade of India adversely; or
(2) that the suspension or cancellation of the
Importer-exporter Code Number is likely to lead to
non-fulfilment of any obligation by India under any
international agreement.
(2) The special licence granted to any person under
sub-rule (1) shall be non-transferable.
4. Application for grant of licence.- A person
may make an application for the grant of a licence to import or
export goods in accordance with the provisions of the Policy or an
Order made under section 3.
5. Fee.- (1) Every application for a licence to
import shall be accompanied by the fee specified in the Schedule.
(2) The mode of deposit of fee shall be as specified in the
Schedule.
(3) No fee shall be payable in respect of any application
made by:
(a) the Central Government, a State Government or any department
or any office of the Government;
(b) any local authority for the bona fide import of goods
required by it for official use;
(c) any institution set up for educational, charitable or
missionary purposes, for the import of goods required for its
use;
(d) an applicant for the import of any goods (other than a
vehicle) if the import of the goods is for his personal
use which is not connected with trade or manufacture.
(4) The fee once received will not be refunded except in the
following circumstances, namely :-
(i) where the fee has been deposited in excess of the specified
scale of fee;
or
(ii) where the fee has been deposited but no application
has been made; or
(iii) where the fee has been deposited in error but the
applicant is exempt from payment of fee.
6. Conditions of licence.- (1) It shall be
deemed to be a condition of every licence for export that:-
(i)
no person shall transfer or acquire by transfer any licence issued
by the licensing authority except in accordance with the
provisions of the Policy;
(ii) the goods for the export of which the licence is
granted shall be the property of the licensee at the time of the
export.
(2) The licensing authority may issue a licence for import subject
to one or more of the following conditions, namely: -
(a) that the goods covered by the licence shall not be disposed
of except in accordance with the provisions of the Policy or in
the manner specified by the licensing authority in the licence;
(b) that the applicant for a licence shall execute a bond
for complying with the terms and conditions of the licence.
(3) It shall be deemed to be a condition of every licence for
import that:
(a) no person shall transfer or acquire by transfer any licence
issued by the licensing authority except in accordance with the
provisions of the Policy;
(b) the goods for the import of which a licence is granted
shall be the property of the licensee at the time of import and
upto the time of clearance through customs;
(c) the goods for the import of which a licence is granted
shall be new goods, unless otherwise stated in the licence;
(d) the goods covered by the licence for import shall not
be exported without the written permission of the Director
General.
(4) Any person importing goods from the United States of America
in accordance with the terms of the Indo-US Memorandum of
Understanding on Technology Transfer shall also comply with all
the conditions and assurances specified in the Import Certificate
issued in terms of such Memorandum, and such other assurances
given by the person importing those goods to the Government of the
United States of America through the Government of India.
7. Refusal of licence.-(1) The Director General
or the licensing authority may for reasons to be recorded in
writing, refuse to grant or renew a licence if -
(a) the applicant has contravened any law relating to
customs or foreign exchange;
(b) the application for the licence does not substantially
conform to any provision of these rules;
(c) the application or any document used in support
thereof contains any false or fraudulent or misleading
statement;
(d) it has been decided by the Central Government to
canalise the export or import of goods and distribution thereof,
as the case may be, through special or specialised agencies;
(e) any action against the applicant is for the time being
pending under the Act or rules and Orders made thereunder;
(f) the applicant is or was a managing partner in a
partnership firm, or is or was a Director of a private limited
company, having controlling interest against which any action is
for the time being pending under the Act or rules and Orders
made thereunder;
(g) the applicant fails to pay any penalty imposed on him
under the Act;
(h) the applicant has tampered with a licence;
(i) the applicant or any agent or employee of the
applicant with his consent has been a party to any corrupt or
fraudulent practice for the purposes of obtaining any other
licence;
(j) the applicant is not eligible for a licence in accordance
with any provision of the Policy;
(k) the applicant fails to produce any document called for
by the Director General or the licensing authority;
(l) in the case of a licence for import, no foreign
exchange is available for the purpose;
(m) the application has been signed by a person other than
a person duly authorised by the applicant under the provisions
of the Policy;
(n) the applicant has attempted to obtain or has obtained
cash compensatory support, duty drawback, cash assistance
benefits allowed to Registered Exporters or any other similar
benefits from the Central Government or any agency authorised by
the Central Government in relation to exports made by him on the
basis of any false, fraudulent or misleading statement or any
document which is false or fabricated or tampered with.
(2) The refusal of a licence under sub-rule (1) shall be without
prejudice to any other action that may be taken against an
applicant by the licensing authority under the Act.
8. Amendment of licence. -The licensing
authority may of its own motion or on an application by the
licensee, amend any licence in such manner as may be necessary or
to rectify any error or omission in the licence.
9. Suspension of a licence.- (1) The Director
General or the licensing authority may, by order in writing,
suspend the operation of a licence granted to -
(a) any person, if any order of detention has been made
against such person under the provisions of the Conservation of
Foreign Exchange and Prevention of Smuggling Activities Act, 1974
(52 of 1974); or
(b) a partnership firm or a private limited company, if the
person referred to in clause (a) is a partner or a whole time
director or managing director, as the case may be, of such firm
or company:
Provided that the order of suspension shall cease to have effect
in respect of the aforesaid person or, as the case may be, the
partnership firm or company, when the order of detention made
against such person, -
(i) being an order of
detention to which the provisions of section 9 of the
Conservation of Foreign Exchange and Prevention of Smuggling
Activities Act, 1974 (52 of 1974) do not apply, has been revoked
on the report of Advisory Board under section 8 of that Act
or before receipt of the report of the Advisory Board or before
making a reference to the Advisory Board; or
(ii) being an order of detention to which the provisions
of section 9 of the Conservation of Foreign Exchange and
Prevention of Smuggling Ac-tivities Act, 1974 (52 of 1974)
apply, has been revoked on the report of the Advisory Board
under section 8 read with sub-section (2) of section 9 of the
Act or before receipt of such report;
(iii) has been set aside by a court of competent
jurisdiction.
(2) The Director General or the licensing authority may by an
order in writing suspend the operation of any licence granted
under these rules, where proceedings for cancellation of such
licence has been initiated under rule 10.
10. Cancellation of a licence.- The Director
General or the licensing authority may by an order in writing
cancel any licence granted under these rules if -
(a) the licence has been obtained by fraud, suppression of facts
or misrepresentation; or
(b) the licensee has committed a breach of any of the
conditions of the licence; or
(c) the licensee has tampered with the licence in any
manner; or
(d) the licensee has contravened any law relating to
customs or foreign exchange or the rules and regulations
relating thereto.
11. Declaration as to value and quality of
imported goods. - On the importation into, or exportation out
of, any customs ports of any goods, whether liable to duty or
not, the owner of such goods shall in the Bill of Entry or the
Shipping Bill or any other documents prescribed under the Customs
Act, 1962 (52 of 1962), state the value, quality and description
of such goods to the best of his knowledge and belief and in case
of exportation of goods, certify that the quality and
specification of the goods as stated in those documents, are in
accordance with the terms of the export contract entered into
with the buyer or consignee in pursuance of which the goods are
being exported and shall subscribe a declaration of the truth of
such statement at the foot of such Bill of Entry or Shipping Bill
or any other documents.
12. Declaration as to Importer-exporter Code
Number. - On the importation into or exportation out of any
Customs port of any goods the importer or exporter shall in the
Bill of Entry or Shipping Bill or, as the case may be, in any
other documents prescribed by rules made under the Act or the
Customs Act, 1962 (52 of 1962), state the Importer-exporter Code
Number allotted to him by the competent authority.
13. Utilisation of imported goods.- (1) No
person shall use any imported goods allotted to him by the State
Trading Corporation of India or any other agency recognised by
the Central Government in a manner and for the purpose,
otherwise than as declared by him in his application for such
allotment or in any document submitted by him in support of such
application.
(2) No person shall dispose of any goods imported by him
against a licence except in accordance with the terms and
conditions of such licence.
14. Prohibition regarding making, signing of any
declaration, statement or documents.- (1) No person shall make,
sign or use or cause to be made, signed or used any declaration,
statement or document for the purposes of obtaining a licence or
importing any goods knowing or having reason to believe that such
declaration, statement or document is false in any material
particular.
(2) No person shall employ any corrupt or fraudulent
practice for the purposes of obtaining any licence or importing
or exporting any goods.
15. Power to enter premises and inspect, search
and seize goods, documents, things and conveyances.- (1) Any
person authorised by the Central Government under sub-section (1)
of section 10 (hereinafter called the authorised person) may, at
any reasonable time enter any premises in which -
(i) any imported goods or materials which are liable to
confiscation under the provisions of the Act; or
(ii) any books of accounts or documents or things which,
in his opinion, will be useful for, or relevant to any
proceedings under the Act,
are suspected to have been kept or concealed and may inspect such
goods, materials, books of accounts, documents or things and may
take such notes or extracts therefrom as he may think fit.
(2) If the authorised person has reasons to believe that -
(i) any imported goods or materials liable to
confiscation under the Act; or
(ii) any books of accounts or documents or things which,
in his opinion, will be useful for, or relevant to, any
proceedings under the Act,
are secreted in any premises he may enter into and search such
premises for such goods, materials, books of accounts, documents
or things.
(3) (a) If the authorised person has reason to believe
that any imported goods or materials are liable to confiscation
under the Act, he may seize such goods or materials together
with the package, covering or receptacle, if any, in which such
goods or materials are found to have been mixed with any other
goods or materials :
Provided that where it is not practicable to seize any
such goods or materials, the authorised person may serve on the
owner of the goods or materials an order that he shall not
remove, part with or otherwise deal with the goods or materials
except with the previous permission of the authorised person.
(b) Where any goods or materials are seized under clause
(a) and no notice in respect thereof is given within six months
of the seizure of the goods or materials, the goods or materials
shall be returned to the person from whose possession they were
seized:
Provided that the aforesaid period of six months may, on
sufficient cause being shown, be extended by the Director
General for a further period not exceeding six months.
(c) The authorised person may seize any books of accounts
or documents or things which in his opinion, will be useful for,
or relevant to, any proceedings under the Act.
(d) The person from whose custody any documents are seized
under this sub-rule, shall be entitled to make copies thereof or
take extracts therefrom in the presence of the authorised
person.
(e) If any person legally entitled to the books of account
or other documents or things seized under this sub-rule objects,
for any reason, to the retention by the authorised person of the
books of account or the documents or things, he may move an
application to the Central Government stating therein the
reasons for such objection, request for the return of the books
of account or documents or things.
(f) On receipt of the application under clause (e), the
Central Government may, after giving the applicant an
opportunity of being heard, pass such order as it may think fit.
(g) Where any document is produced or furnished by any person or
has been seized from the custody or control of any person under
the Act or has been received from any place outside India in the
course of the investigation for any contravention referred to in
section 11 by any person and such document is tendered in
evidence against the person by whom it is produced or from whom
it was seized or against such person or any other person who is
jointly proceeded against, the Adjudicating Authority shall,
notwithstanding anything to the contrary contained in any other
law for the time being in force, -
(i) presume, unless the
contrary is proved, that the signature and every other part of
such document which purports to be in the handwriting of any
particular person of which the Adjudicating Authority may
reasonably assume to have been signed by or to be in the
handwriting of any particular person, is under the person"s
handwriting, and in the case of a document executed or attested,
it was executed or attested by the person by whom it purports to
have been so executed or attested;
(ii) admit the document in evidence notwithstanding that
it is not duly stamped, if such document is otherwise
admissible in evidence.
(4) The authorised person, may, if he has reason to suspect that
any conveyance or animal is being or is about to be used for the
transportation of any imported goods or material which are
liable to confiscation under the Act, and that by such
transportation any provision of the Act has been, is being or is
about to be contravened at any time, stop such conveyance or
animal or in the case of aircraft compel it to land, and -
(a) rummage and search the conveyance or any part thereof;
(b) examine and search any goods or material in the
conveyance or on the animal;
(c) if it becomes necessary to stop any conveyance or
animal, he may use all lawful means for stopping it and where
such means fail, the conveyance or animal may be fired upon,
and where he is satisfied that it is necessary so to do to
prevent the contravention of any provision of the Act or of the
rules and orders made thereunder or the Policy or condition of
any licence, he may seize such conveyance or animal.
Explanation. - Any reference in this rule to a
conveyance shall, unless the context otherwise requires, be
construed as including a reference to an aircraft, vehicle or
vessel.
16. Settlement.- (1) The Adjudicating
Authority may determine the amount of settlement to be paid by
the person to whom a notice has been issued and who has opted
for settlement and has admitted the contravention specified in
the notice, in the following cases, namely:-
(i) where it is of the opinion that the contravention of any
provision of the Act or these rules or the Policy has been made
without
mens rea or without wilful mistake or without
suppression of facts, or without any collusion, or without
fraud and forgery, or without an intent to cause loss of
foreign exchange; or
(ii) where the person importing the goods has not met
the requirements of the actual user conditions as specified in
the Policy and has not misutilised the said imported goods; or
(iii) where the person importing the goods has not
fulfilled the export obligation and has not misutilised the
said imported goods.
(2) Where a person has opted for settlement under sub-rule (1),
the settlement made by the Adjudicating Authority shall be
final.
17. Confiscation and redemption.- (1) Any
imported goods or materials in respect of which -
(a) any condition of the licence, or letter of authority under
which they were imported relating to their utilisation or
distribution; or
(b) any condition relating to their utilisation or
distribution, subject to which they were received from or
through, an agency recognised by the Central Government; or
(c) any condition imposed under the Policy with regard
to the sale or disposal of such goods or materials,has been,
is being, or is attempted to be, contravened, shall together
with any package, covering or receptacle in which such goods
are found, be liable to be confiscated by the Adjudicating
Authority, and where such goods or materials are so mixed with
any other goods or materials that they cannot be readily
separated, such other goods or materials shall also be liable
to be so confiscated :
Provided that where it is established to the satisfaction of the
Adjudicating Authority that any goods or materials which are
liable to confiscation under this rule, had been imported for
personal use, and not for any trade or industry, such goods or
materials shall not be ordered to be confiscated.
(2) The Adjudicating Authority may permit the redemption
of the confiscated goods or materials upon payment of
redemption charges equivalent to the market value of such goods
or materials.
18. Confiscation of conveyance.- (1) Any
conveyance or animal which has been, is being, or is attempted
to be used, for the transport of any goods or materials that
are imported and which are liable to confiscation under rule
17, shall be liable to be confiscated by the Adjudicating
Authority unless the owner of the conveyance or animal proves
that it was, is being, or is about to be so used without the
knowledge or connivance of the owner himself, his agent, if
any, and the person in-charge of the conveyance or animal and
that each of them had taken all reasonable precautions against
such use.
(2) The Adjudicating Authority shall
permit redemption of the confiscated conveyance or animal used
for the transport of goods or passengers for hire upon payment
of redemption charges equivalent to the market value of such
conveyance or animal.
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