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Ministry of Finance issues circular clarifying the waiver of requirement to furnish bank guarantee/ surety by EOUs

Blog Post created by NASSCOM Community on Aug 24, 2018

This is in reference to a recent Circular F No DGEP/EOU/GST/MISC/24/2017 dated August 14, 2018 (attached herewith) issued by Ministry of Finance clarifying the waiver of requirement to furnish bank guarantee/ surety by EOUs.   

 To recap, one of the points raised by NASSCOM at the All India Customs Consultative Group was on the aspect that the new Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 which prescribed the revised requirements of bank guarantee/ cash security/ surety.  We had highlighted that field officers were taking a stand that the B-17 bond executed by EOUs would not suffice and a bank guarantee as per these new Rules would need to be furnished. 

 

While an earlier Circular (No. 29/2017-Customs dated 17.07.2017) clarified that the B-17 bond executed by EOUs will serve the purpose of continuity bond as required under the Rules.  However, since this Circular did not specifically refer to EOU units, companies continued to face an issue at the ground level. This has now been resolved through this Circular which clarifies that the EOUs would also be governed under the said circular.

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