The move seeks to give relief to businesses that imported gold and other precious metals during the second wave of the pandemic but could not meet their re-export obligation because factories were closed
New Delhi: Businesses that import precious metals duty-free for making jewellery and gold coins under an export promotion scheme have got extra time for meeting their export obligation.
An official order from the Central Board of Indirect Taxes and Customs (CBIC) issued on Thursday showed that these entities will now get six months extra to meet the export obligation.
The move seeks to give relief to businesses that imported gold and other precious metals during the second wave of the pandemic but could not meet their re-export obligation because factories were closed.
“Businesses are allowed to import precious metals duty free provided they re-export within three months. There are several state agencies and other RBI-approved entities that take benefit of this provision. The new notification gives extra time of six months if the due date for exports falls between 1 February and 30 June 2021," explained Abhishek Jain, partner, EY.
This change will give benefit to numerous importers who are importing silver, gold and platinum to India as replenishment under the scheme for 'export through exhibitions/export promotion tours/export of branded jewellery', or under the scheme for 'export against supply by nominated agencies,' said Rajat Mohan, senior partner at chartered accountants firm AMRG & Associates.
The nominated agencies are Metals and Minerals Trading Corporation Ltd (MMTC), Handicraft and Handloom Export Corp. (HHEC), State Trading Corp. (STC), Project and Equipment Corp. of India Ltd (PEC) and any agency authorised by the Reserve Bank of India (RBI), as per the foreign trade policy. It allows the import of gold, silver and platinum duty-free with the condition that these are to be used as inputs for export production.
The centre had earlier given tax and compliance-related relief to help businesses deal with the disruption caused by the pandemic. That covers Goods and Services Tax-related and income tax-related reporting requirements as well as various statutory filing obligations under the Companies Act. With the second wave of the pandemic receding, most of the regional mobility restrictions have been eased.