Question No. 5 - IBO - 04 - Export Import Procedure and Documentation - Master of Commerce (M.Com)

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IBO - 04 - Export Import Procedure and Documentation

Master of Commerce (M.Com) - 1st Year

Question No. 5 Write notes on the following: 
(a) General Provisions for imports.

The Ministry of Commerce and Industry and Directorate General of Foreign Trade and Investment (DGFT) implemented the foreign trade policy of the year 2015-2020, which contains the general provisions for import and export in Chapter 2. They are as follows:

1. Exports and imports are free unless regulated– Exports and Imports shall be free, except in cases where they are regulated by the provisions of this Policy or any other law for the time being in force. The item-wise export and import policy shall be, as specified in ITC(HS) published and notified by the Director-General of Foreign Trade, as amended from time to time.
2. Laws are to be complied– Every exporter or importer shall comply with the provisions of the Foreign Trade (Development and Regulation) Act, 1992, the Rules and Orders made thereunder, the provisions of this Policy, and the terms and conditions of any license/certificate/permission granted to him, as well as provisions of any other law for the time being in force. All imported goods shall also be subject to domestic Laws, Rules, Orders, Regulations, technical specifications, environmental and safety norms as applicable to domestically produced goods. No import or export of rough diamonds shall be permitted unless the shipment parcel is accompanied by Kimberley Process (KP) Certificate required under the procedure specified by the Gem & Jewellery Export Promotion Council (GJEPC).
3. Procedure– The DGFT specifies the procedure that has to be followed by the exporter and importer or by any other authority to follow any of the procedures which are laid down in any Acts, handbooks, etc. Once the procedure is being established it has to be published on public notice, and these procedures can be subjected to change as well.
4. Exemption- If due to any genuine reason, relaxation is needed in any procedure, the request can be made to the DGFT, who can pass orders on the same. The DGFT can relax certain procedures for public interest as well, such request may be considered only after consulting Advance Licensing Committee (ALC) if the request is in respect of a provision of Chapter-4 (excluding any provision relating to Gem & Jewellery sector) of the Policy/ Procedure. 
5. Restriction principles- The DGFT on notification can enforce any decision that is necessary for (a) protection of public morals (b) Protection of human, animal, or plant life or health (c)Protection of patents, trademarks, and copyrights and the prevention of deceptive practices (d) Prevention of use of prison labour (e) Protection of national treasures of artistic, historic or archaeological value (f) Conservation of exhaustible natural resources (g) Protection of trade of fissionable material or material from which they are derived (h) Prevention of traffic in arms, ammunition, and implements of war.
6. Goods which are restricted- Any goods which are restricted can only be imported and exported if there is a license for the same and a public notice has to be issued as well on this behalf.
7. Terms and conditions- There are certain terms and conditions which have to present while obtaining a license or a certificate, they include:(a) The quantity, description, and value of goods (b) Actual user condition (c) Export obligation (d) The value addition to be achieved (e) The minimum export price.
8. Penalty- If a license/certificate/permission holder violates any condition of the license/certificate/ permission or fails to fulfill the export obligation, he shall be liable for action in accordance with the Act, the Rules and Orders made thereunder, the Policy and any other law for the time being in force.
9. Permission to get license etc.- No person may claim a license/certificate/ permission as a right and the Director-General of Foreign Trade or the licensing authority shall have the power to refuse to grant or renew a license/certificate/permission in accordance with the provisions of the Act and the Rules made thereunder.
10. Import on export basis- New or second-hand capital goods, equipments, components, parts and accessories, containers meant for packing of goods for exports, jigs, fixtures, dies and mould, may be imported for export without a licence/certificate/permission on the execution of Legal Undertaking/Bank Guarantee with the Customs Authorities provided that the item is freely exportable without any conditionality/requirement of license/ permission as may be required under ITC (HS) Schedule II.

(b) Foreign Currency Account. 

A ‘Foreign Currency Account’ means an account held or maintained in a currency that is not the currency of India or Bhutan, or Nepal. Any person who is residing in India can open, hold and maintain a foreign account. ‘Person Resident in India’ is defined under Section 2(v) of the Foreign Exchange Management Act, 1999 (FEMA). 

‘Person resident in India’ means—

1. Every person residing in India for more than one hundred and eighty-two days during the preceding financial year but does not include –

• a person who has gone or stays outside India for taking up employment or carrying a business or vocation outside India or any other purpose where he/she indicates their intention to stay outside India for an uncertain period,
• a person who has come to or stays in India, otherwise than for taking up employment or carrying on business or vocation in India or any other purpose where he/she indicates their intention to stay for an uncertain period in India.

• Every person or body corporate incorporated or registered in India,
• An office, agency or branch in India that is owned or controlled by a person resident outside India, 

• An office, agency or branch outside India that is owned or controlled by a person resident in India.

(c) Financing under Deferred Payment Arrangement. 

Under Section 34 of the Care Act a universal Deferred Payment scheme has been established. A deferred payment scheme allows the person entering into it to delay making some or all of their payments to the Local Authority for the Care and Support services they receive. It allows them time to come to terms with their situation and consider their options without having to rush into selling their home. Some people enter into a deferred payment agreement until they die but others use it as a 'bridging loan' while they decide what best to do and explore options available for meeting the cost of care (for example, they may be able to arrange the release of another asset to meet the cost). How long a person has a deferred payment agreement for is entirely up to them.

When a Deferred Payment agreement is entered into the Local Authority usually secures its interests by arranging for a land registry charge to be placed upon the person's property for an amount known as the Equity Limit. They then defer all payments until this amount is reached or the agreement is terminated, whichever comes first. At this point the person's home is sold and the Local Authority receives payment for the care costs it has deferred under the agreement.

Payments that can be deferred

The person can defer the full amount of their care costs or an element of their care costs (if they choose to make a contribution from another source).

Payments must be deferred up to the personal budget amount (or what that amount would be likely to be where people have not been assessed by the Local Authority). If the person wishes to defer less than the personal budget amount this can be agreed but they need to be able to pay the difference between what is being deferred and the personal budget amount.

If a person has chosen to live in a care home that costs more than the personal budget amount the Local Authority does not have to defer the 'top-up' amount payable, although it has the power to do so if it wishes to. If the Local Authority does not decide to defer the top-up amount then top-up remains payable.

Payments relating to interest and charges made by the Local Authority can also be deferred if the person requests it and the Local Authority is in agreement.

Payments can only be deferred for costs charged by the Care and Support provider for services provided. Where the person lives in a care home provision this is likely to include associated accommodation costs but where the person lives in supported living and pays rent to a landlord (who may or may not be the care provider) these rental payments cannot be deferred.

(d) ISO 9000. 

ISO 9000 is a set of standards for quality management, developed as an internationally-acceptable baseline for performance by businesses and other organizations. It was created by the International Organization for Standardization (ISO) with input from standards professionals from many nations.

Quality management is the act of overseeing all of the processes that go into achieving and maintaining the desired level of excellence in the creation and delivery of a product or service. This includes the determination of a quality policy, creating and implementing quality planning and assurance, and quality control and improvement. It is also referred to as total quality management (TQM).

ISO 9000 standards were developed to help manufacturers effectively document the quality system elements that need to be implemented to maintain an efficient quality system. They are increasingly being applied to any organization or industry.

ISO 9001 is now being used as a basis for quality management—in the service sector, education, and government—to help organizations satisfy their customers, meet regulatory requirements, and achieve continual improvement.

The ISO 9000 series, or family of standards, was originally published in 1987 by the International Organization for Standardization (ISO). They first gained popularity in Europe, and then spread to the U.S. in the 1990s. As the world’s view of quality assurance has evolved, the standards have been revised.

Current versions of ISO 9000 and ISO 9001 were published in September 2015.