WRITE-OFF OF UNREALIZED EXPORT GBCA BILLS EXPORT OF GOODS AND SERVICES-SIMPLIFICATION

It is obligatory on the part of the exporter to realize the full value of goods to India within a stipulated period fro the date of export as under!" Units in SEZ #tatus $older %xporters as defined in the &oreign 'rade Policy 1** + %xport ,riented -nits .%,-s/ and units set up under %lectronic $ardware 'echnology Par0s .%$'Ps/1 #oftware 'echnology Par0s andto Biotechnology Goods.#'Ps/ exported a warehouse established outside India In all other cases No s !"i#i" ti$! !%io& (ithin a period of 1) onths fro the date of transport (ithin a period of twelve onths fro the date of export on or after #epte ber 11 )**2 As soon as it is realised and in any case within fifteen onths fro the date onths of ship of goods 1) froent the date of export3

'he existing provisions of the 4BI rules provide for writing off in which the exporters were given li ited powers and also A5 Category " I ban0s were per itted to accede to the re6uests for write off ade by the exporters sub7ect to certain conditions3 As !% "i%"'()% No* ++ &)t!& M)%", -./ .0-11 it is now decided that for write off of unrealized export bills export bills the following li its shall be effective3 %xporter #elf write off by an exporter A ended li its 23 of tot)( export proceeds realized during previous (rite off by authorized 5ealer Ban0 -03 ofthe total export ")(!n&)% proceeds realized during previous #elf write"off by status holder -03 ofthe total export ")(!n&)% proceeds exporters realized during the previous ")(!n&)% 4!)%* 'he above li it shall be cu ulatively available in a year3 (rite off will be sub7ect to certain conditions! a/ 'he relevant a ount has re ained o'tst)n&in5 #o% $o%! t,)n on! 4!)%3 b/ S)tis#)"to%4 &o"'$!nt)%4 !6i&!n"! is furnished in support of the exporter that he has ade all efforts to realize the dues8 c/ 'he case falls under any of the under noted categories!
Ghalla & Bhansali Chartered Accountants Page 1

.i/

WRITE-OFF OF UNREALIZED EXPORT GBCA BILLS EXPORT OF GOODS SERVICES-SIMPLIFICATION 'he overseas buyer AND has been declared inso(6!nt and a certificate fro
the official li6uidator stating that there is no possibility of recovery3 .ii/ 'he overseas buyer is not t%)"!)7(!

Ghalla & Bhansali Chartered Accountants

Page )

WRITE-OFF OF UNREALIZED EXPORT GBCA BILLS EXPORT OF GOODS AND SERVICES-SIMPLIFICATION

.iii/ 'he

goods exported have been )'"tion!& o% &!st%o4!& by the Port:Custo s:$ealth authorities in the i porting country3 .iv/ 'he unrealized a ount represents the balance due in a ")s! s!tt(!& through the intervention of the Indian % bassy1 foreign cha ber of co erce or other such organizations3 .v/ 'he unrealized a ount represents the not &%)8n 7)()n"! of an export bill .not exceeding 1*+ of the invoice value/ re aining outstanding and turned out to be unrealizable despite all efforts ade by the exporter8 .vi/ 'he cost of resorting to (!5)( )"tion would be disproportionate to the unrealized a ount of the export bill or where the exporter could not execute the court decree1 due to the reasons beyond his control1 even after winning the court case3 .vii/ Bills were drawn for the &i##!%!n"! between the letter of credit value and actual export value or between the provisional and the actual freight charges and the a ount re ains unrealized and there are no prospects of any realization3 d/ 'he exporter has s'%%!n&!%!& %o o%tion)t! !9 o%t in"!nti6!s1 if any availed of in the respect of ship ents3 'he A5 category ; I ban0s should obtain docu ents evidencing surrender of export incentives availed3 e/ In case of self write"off1 the exporter should sub it to the concerned A5 ban01 a C,)%t!%!& A""o'nt)nt:s "!%ti#i")t!* 'he following would not ;')(i#4 for write off facility! a/ %xports ade to countries with !9t!%n)(i<)tion %o7(!$ i3e3 where the overseas buyer has deposited the value of export in local currency but the a ount has not been allowed to be repatriated by the central ban0ing authorities of the country3 b/ GR=SDF for s which are under investigations by agencies as also outstanding bills which are s'7>!"t $)tt!% o# "i6i(="%i$in)( s'it3 'he above revision in the li its is done with the view to si plify and liberalize the procedure and for providing greater flexibility to all exporters as well as the Authorised 5ealer Ban0s3

Ghalla & Bhansali Chartered Accountants

Page 9