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REGISTERED No. D. 221

The Gazette of India

EXTRAORDINARY

PART I—Section 1

PUBLISHED BY AUTHORITY

No. 184] NEW DELHI, WEDNESDAY, NOVEMBER 11, 1970/ KARTIKA 20, 1892

Separate paging is g i v en to this Part in order that it may be filed

as a separate compilation.

MINISTRY OF FOREIGN TRADE

PUBLIC NOTICE

IMPORT TRADE CONTROL

New Delhi, the 11th November, 1970

SUBJECT.—Lkensing conditions applicable to licences issued under the £0,5 Million

allocation for NSIC under UK/India Capital Investment Loan, 1969.

No. 163-ITC(PN)/70.—The terms and conditions governing the issuance of import licences against the £0.5 Million allocation for NSIC under UK/India Capital Investment Loan, 1969 as given in Appendix to this Public Notice arc notified for information of the Trade.

APPENDIX

Schedule of conditions applicable to Licences issued under the £0.5 Million Allocation

for NSIC under the UK/India Capital Investment Loan 1969.

Each import licence number will contain a suffix "NSIC (69)".

2 The import licence number with the above-mentioned suffix should be indicated by the Importer/supplier in all contracts, invoices and/or contracts certificates referring to goods to be imported under the licence.

(1049)

3. No remittance of foreign exchange is permitted against this import licence except U.K. bank charges which may be remitted through ordinary banking channels. Any payment towards Indian Agents Commission should be made in Indian rupees to the ag#its in India. Such payments, however, will form part of the licence value and will therefore, be charged to the licence.

4. The licence will be issued with an initial validity period of twelve months. Firm orders, on C.I.F. or C. & F. basis, must be placed on the suppliers in U.K. (which expres- sion includes the Channel Islands and the Isle of Man) within four months from tho date of issue of the import licence. If orders cannot be placed within four months for valid reason, the licence should be submitted to the licensing authority during the 5th month giving the reasons for the delay in placing orders and indicating the date by which orders would be placed. Such requests will be considered on merits by the CCI&E, in consulta- tion with the Ministry of Finance (Deptt. of Economic Affairs) as necessary.

IMPORTANT NOTE.—It is necessary that ordering is completed within 4 months (or any extended period allowed by the licensing authority in any case) The authorised dealers in foreign exchange will not permit establishment of Letters of Credit and deposit of rupee equivalent, unless this requirement is complied with.

5. All payments must be completed within a month of the expiry of the'licence • Indi- vidual payment must be arranged upon shipment of goods No credit facility of any kind will be permitted.

6. Special points to be incorporated in the orders I contracts.— (i)\ Originof " " ^ .-

by persons oidinarfly resident or carrying on business in t"e U.K.

(ii) fw™,,_P.yme"ia 10 the UK. "™K™ " V^ " X ^ iS in I ' V E™

.J-JifS? £ S " iD "SSP fSASShSSif 5SSJ SMS

find payment certifiates.

N O T E- If in any case, a contract is placed on the Indian Agent of the f°™Rn ™pg*r

dlong with letters of credits as prescribed In para 8(10 below.

7. Payments against Import Licence—Letter of Credit Procedure.—(a) Payments to U.K Suppliers shall be arranged by importers by opening irrevocable and confirmed Letter of Credit in favour of the suppliers by any of the nominated branches of the State Bank of Ind;a with one of the correspondent Banks in U.K. Such Letters of Credit would provide foi payments to the suppliers on submission of a certain prescribed docu- ments (see para 8 below) and would be opened subject to the condition that the correa- nondent banks in U.K. would, after making payments to the beneficiaries initially out of their own funds, obtain reimbursement therefor, from the State Bank of India. London, through the Chief Accounting OfflcJ to the High Commission of India, London.

(b) The detailed procedure for opening such Letters of Credit will be as follows;—

(i) Within three weeks after obtaining suitable revaluation of I/L vide para 4 above the importer should apply to the Senior Accounts Officer, Economic Aid Accounts, Ministry of Finance (Department of Economic Affairs), Jeevan Deep Building, Parliament Street, New Delhi for a letter of authori- sation for opening a Commercial letter of credit. The application snould be In the form in Annexure I. The application should also indicate specifically the name and address of the U.K. Bank with which the Letter of authorisa- tion Is to be established.

(U) If the application is found to be in orcter, the Ministry of Finance, Depart- ment of Economic Affairs, will issue their Authorisation for the requisite amount to the importer and the nominated branch of the State Bank of India, indicating \nter~alta, the name of the UK Bank with whom letter of Credit in favour of U.K. suppliers should be opened. The Department of Economic Affairs will also advise the U.K. Bank concerned suitably and also C.A.O., London. But this advise to the U.K. Bank will be sent to the Indian Bank alongwith tbeir copy of the authorisation letter, who should then transmit it to the U.K. Bank while opening the letter of Credit. The letter of Credit should be opened within three weeks from the date of issue of the authorisation under intimation to the Ministry of Finance failing which the authorisation shall lapse. The letter of credit opened by the Indian Bank on the designated UK Bank against the Letter of Authorisation issued by Ministry of Finance should detail the conditions to which the licence is subject and call for the submission of all the documents detailed in para 8 below, (The requests for opening letters of Credit by Indian Banks must accord completely with the authorisations for opening letters of Credit issued by the Ministry of Finance.) There should be no discrepancies In any respect.

(iii) Within seven days of the receipt of advice of payment with shipping docu- ments from the U.K. Bank, the nominated branch of the State Bank of India shall collect from the importer the cost of imports in rupees at the xate of Rs. 18.18 for £ 1.00 plus interest charges at 6 per cent per annum for the period from the date of payment to the U.K. supplier by U.K. Bant to the date of deposit of the rupee equivalent. The rate of exchange mentioned above Is the prevailing composite rate of exchange and any change in the same will bo notified as and when decided.

tiv) The amount collected from the importer, should be deposited by the Bank to the credit of the Government or India in the Reserve Bank of India, New Delhi or the State Bank of India, Delhi or if it is not feasible, remitted by means of Demand Draft drawn on and in favour of the State Bank of India. Tis Hazari Branch, Delhi. Thereafter, the Treasury Challan evi- dencing the deposit shall be sent by registered post to the Senior Accounts Officer, Ministry of Finance, Department of Econmic Affairs, Econmic Aid Accounts Section, Jeevan Deep Building, Parliament Street, New Delhi indicating references to and enclosing copies of the Invoice/Shipping docu- ments and the Authrisation of that Department to which the transaction relates. The nominated branch of the State Bank of India shall also, on demand by the Government of Tndia Rrranire to deposit within seven days in the Reserve Bank of India, New Delhi/State Bank of Tndia. Delhi or if it is not feasible by means of a Demand Draft Drawn on the State Bank of India. Tis Hazari Branch, Delhi, of such additional amount on account of service charges as may be demanded bv the Government of Tndin, The nominated branch of the State Bank of India shall release the shipping docu- ments to the importer only after the deposits aforesaid are made to the Government of India-

>rOTE—Importers should also fill In, in duplicate the Form incorporated in Annexure TT of the Public Notice No. 184-TTC(PN)/68 dated 30th August. 1968 and present the same to thcif bank while arrandnR for rupee deposits in accordance with the procedure •prescribed in the said Public Notice.

(v) The amounts including interest and servJ'-e charpes to be deposited to the Credit of the Government of India shall be creditable under the Head of Account T-Sec, Deposits and Advances-Part-TT-Dtposits-Deposlts not bearinc Jnterest-C. Other deposit Accounts- Civil Deposits—Denosits for purchases abroad from UK—purchase under U.K. Loan "Purchases under UK /Tndia Capital Investment Loan 1969" and the Accountant General, Central Revenues, New Delhi shall be shown as the Accounts Officer who will adjust these credits.

8. Documentation Required.—(I) The importer is responsible to see that the U.K. supplier completes and submits the documents detailed in (2) below (in so far as these relate to Win—See Annexure H) to he UK Bank at the time of opening of L /C and also at Itho time of claiming navment for the goods supplied. Earh document must show the loan number, details of import Hcenle Including suffix "NSIC(69V and, if possible, the. Ministry of Finance, Letter of Credit authorisation particulars.

(2) While opening Letters of Credits, the authorised breach of the State Bank of India, on behalf of the importer, will be required to incorporate the following conditions in tho Letters of Credit or their forwarding instructions to the correspondent bank in U Jt,. :*—

(i) Attach five blank copies of tho contract certificate in the prescribed form,

Annexure IV Appendix C to each letter of credit.

(ii) Provide, in the letter of credit, that the beneficiary, must, within four working days after receiving the L/C, send four completed copies of the certifiuue together with two copies of the contract (or letter of credit when there is no contract) to the correspondent bank concerned in U.K.

Provide, further, in the letter of credit that as and when goods are shipped, and pay- ment thereof fulls due, tho supplier shall present to the U.K. Bank, the following docu- ments:—

(a) Tho Original invoice, with three photo copies or copies made by any other

process.

(b) Three copies of the payment certificate ia the form shown in Appendix E.

(iii) The correspondent bank should forward three copies of the contract certificate and (wo copies of the contract (or letter t>f credit) to Chief Accounting Oliker, High Commission of India, (Accounts Department), London who would then transmit same to UK. Government (ODM) and obtain their acceptance of each contract for payment out of loan and advise same to correspondent banks in cases of over £10,000 only.

(iv) For each single contract valued £10,000 or less.—The corresponding bank in UK can issue letters of Credit and advise same to beneficiaries straightaway as confirmed and irrevocable, payments being made- thereafter in the usual way upon presentation of prescribed documents.

For contracts, above £10,000 (each), the letters of Credit to be issued on provisional basis initially with a provision to the effect that they shall become operative only subse- quently on receipt of advice of ODM contract acceptance from CAO, London, vide (iii) above. Thereafter, payments can be made to suppliers in the usual way.

(v) After payments, the correspondent banks would claim reimbursement of the amounts paid by submitting payment certificates Annexure V—Appendix E, and invoices received from suppliers from CAO, London, who would arrange payment to them through State Bank of India, London. Simultaneously, they would, send by AIR MAIL,, tho original negotiable set of documents with additional sets as stipulated in thte letter of Credit, along with a statement or their sterling charges to the nominated branch of tho State Bank of India opening the L/C.

NOTE.—(1) If at any time a contract is amended, or if liability is incurred or is to bo incurred thereunder to a greater or lesser amount than the amount specified in tho con- tract certificate, and the necessary letter of credit is also amended consequently, such amendments, together with relevant supplementary or revised contracts (amendments), should also be processed in the same manner as the initial L/Cs,

(2) The importers and the nominated branch of the State Bank of India should parti- cularly note, condition (iv) above regarding contracts above £10,000., In all such cases contracts and Letters of Credits must contain a provision that they shall not become operative until relevant documents have been, forwarded to the Ministry of Oversea* Development in the UK and the CAO, London has informed the correspondent banks In the UK which are concerned that the contract to which tho letter of credit relatesi is eligi- ble for payment from the loan.

9. Refunds from UK suppliers.—It any money is received by the licensee from the U.K. supplier or a guarantor (insurance company etc.) as a refund or in settlement of Insurance claim etc. such amounts should be arranged to be refunded by the supplier to the concerned correspondent Bank in UK (from where the payment was initially received under L/C) with instructions to refund the amount in turn, to CAO, London for crediting the loan account. After the amount is so credited an equivalent amount In rupees {i.e. W> equivalent of what the Importer actually paid to Government) will be arranged to be refunded to the importer by the Ministry of Finance, upon receipt of claim therefor from the importer- If the refund Is received after the loan Is closed the same will, have to tx> made by the supplier direct to the importer.

As and when any such refund is received, a report thereof should also be made to i" Ministry of Finance, with copy to the Ministry of Industrial Development and Com- pany Affairs (Department of Industrial Development), Foreign Exchange Section Udyoit Bhavan, New Delhi.

10. Reports on ordering and utilisation of Licence.—A monthly report, in the form attached Annexure 111—showing the utilisation status of the licence, should be furnished to the Ministry of Finance, Department of Economic Affairs, Economic Aid Accounts Branch, New Delhi, until the licence is fully utilised with a copy to the Ministry of Industrial Development and Company Affairs, Department of Industrial Development, Foreign Exchange Credit Section. "Udyog Bhavan, New Delhi.

11. Notifying Supplier,—The licensee should apprise the supplier if there is any special provision in the import licence which may affect the suppliers in carrying out the transac tion.

12. Disputes.—It should be understood that the Government of India will not under- take any responsibility for disputes, if any, that may arise between the licensed and the suppliers.

13. Future Instructions.— The Licensee shall promptly comply with any directions, instructions or orders issued by the Government regarding any and all matters arising from or pertaining to the import licence and for meeting all obligations under the credit agreement

14. Breach or Violation.—Any breach or violation of conditions set forth in the above paras will result in appropriate action under the Imports and Exports (Control) Act.

15. List of Amisxurcs by Titles.—

Annexure I: Form of application for Letter of Credit authorisation. Annexure II: Documents required from suppliers, Annexure III: Monthly Report on ordering and utilisation of I/L. Annoxure IV: Contract certificate (Appendix-C). Annexure V; Payment Certificate (Appendix-E).

ANNEXURE I

Form of Application for Letter of Credit Authorisation.

To

The Senior Accounts Officer, Economic Aid Accounts Section, Ministry of Finance, (Department of Economic Affairs), Jeevan Deep Building, Parliament Street, New Delhi.

SUBJECT.—Import of

from U.K. under U.K. Loan

Sir,

In connection with the import of

from U.K against the above U.K. Loan we furnish the following particulars to tenable you to issue us authorisation for opening a Letter of Credit through our bankers on the U.K. Bank designated by us:—

(a) Particulars of Import Licence.

No. and Date Value (Rs.) Date upto which valid.

(b) Sterling value of licence

(calculated at £1 per Rs. 18).

(c) Sterling value of the orders placed for which authorisation is required speci- (c) Sterling v a m en^e ^ ^ ^H rf ^ y R s U c r/ h e ra mA the

amount's of authorisations required separately against each supplier (copy of orders tilaced and U.K. suppliers' acceptance thereof to be attached).

(d) Name of U.K. Correspondent Bank who will advise the Letter of Credit 14?

U.K. supplier.

(0) Name and address of the Branch o£ tho State Bank of India which will open the letter of credit.

Yours faithfully,

Authorised representative of the licensee-

(full address to be given hero)-

ANNEXUBE H

Documents Required from Supplier.

At the time of opening L/C

1. Four completed copies of contract certificate (Annexure IV) with the two copies of contract (or L/C. where there is no contract) to the corresponding bank in U.K. within 4 working days after receiving L/C.

2. At the time of payment.

(1) Supplier's invoice (duly signed) original and three photo copies or copies by any other process.

A. Tho invoice should show the name and address of the importer, quantity and detailed description of each item supplied; sales price for each itiem reflecting all trade discounts the basis of delivery (FOR, CIF, CIF k FAC) of the goods, the sterling cost of any Incidental services Including delivery services marine or transportation insurance and the sterling, cost of such insurance.

3. Evidence of Shipment

A, Bill of lading or substitute one copy (or photostat) of ocean or charter party bill of lading or airway bill or parcel post receipt. Tho Bill of Lading shall indicate tho carrier's statement of charges in whatever cur. rency it is paid.

4. Payment certificate in the form prescribed (Annexuro V). Three copies duly signed-

5. Additional Documentation:

Such additional or substitute documentation as may bo specified from, time to tim" by the Government of India.

ANNEXUHE m

Form of Utilisation Report in respect of U.K. Credits

(to be furnished separately in respect of each licence).

1. Name of the Importing Firm.

2. Particulars of U.K. Credit.

3. No. and date of the Import Licence.

4. Value of tho Import Licence.

5. Value of the complete contracting documents forwarded so far to tho Ministry of Finance (Please give details of Contract Nos. and Value).

6. Value of the Contracts approved by th© U.K. Government a$ notified by th" High Commission of India.

7. Payments made to the U.K. suppliers (up-to-date).

8. Payments yet to be made In respect of the contracts already approved. (Indicate quarterly phasing of such payments).

9. Value of further orders intended to be placed on U.K. suppliers.

10. Surrenders, if any.

Signature of the authorised,

officer of the Importing Firm.

APPENDDC C

ANNEXURE IV

UNITED KINGDOM/INDIA CAPITAL INVESTMENT LOAN 1969 (NSIC

ALLOCATION)

CONTRACT CERTIFICATE

Particulars of Contract

1. Date of Contract _ 2. C o n t r a ct No

3. Description of goods or services to be supplied to the purchaser ———. If a number of items are to be supplied, a detailed list should he appended to this certificate-

4. Total contract price payable by purchaser (state CIF, C&F or FOB) £ . If goods are to be supplied the following sections must be completed. If the con- tractor is exporting agent only, the information requested should be obtained from manufacturer.

5. Estimated per cent of the FOB value of the goods not originating in the United Kingdom, but purchased by the contractor directly 'from abroad, i>. per cent of imported raw material or components used to manufacture.

(a) per cent FOB value

(b) Description of items and brief specifications

6. If any raw material or components used orginated from abroad, e.g. copper, asbestos, cotton, wood pulp, etc., but have been purchased in the United Kingdom by the contractor for this contract, specify:—•

(a) per cent FOB value

(b) Description of items and brief specifications

If services are to be supplied, the following section should also be completed.

7. State the estimated value of any work to be done of services performed in the purchaser's country by:—

(a) Your firm (site engineer's charges, etc.)—— — — — •

(b) Local contractor •

8. Qualifying remarks as necessary in respect of paragraph 5, 6 or 7 above

9 I hereby declare that I am employed in the United Kingdom by the Contractor named below and have the authority to sign this certificate. I hereby under- take that in performance of the contract no goods or services which are not of United Kingdom origin will be supplied by the Contractor other than those specified in paragraphs 5, 6, 7 and 8 above.

otc : For the purpojc of this .iigni;d

declaration the United 1'o-itiOi held Kingdom includes the Ni is a d Add CJS of Cont-acio. Channel Islands and the Isle of Ma-i. Date

PAYMENT;,

FOR OFFICIAL U SE ONLY Name or Number of Project

D^te Amount lJ. No. IniT:ala Dare of

/ijltry Acceptance

Amount Commited £

Date I mt ials

APPENDIX "E"

ANNEXURE V

UNITED KINGDOM/INDIA CAPITAL INVESTMENT LOAN, 1969 (NSIC ALLOCATION) PAYMENT CERTIFICATE

I hereby certify that

(Purchaser) (i) the payments referred to in the invoice listed below, which or copies of which accompany this payment certificate, fall due and are due to be made in res- pect of Contract No dated between the contractor named below and and are in accordance with the particulars of this contract notified In the contract certificate signed on behalf of the said contrator on

Contractors Date Amount cho<-t description of goods, work and/ Invoice No. £ 0: services

(ii) The amounts specified in paragraph (i) do not include any additional foreign content to that declared in Paragraphs 5, 6 or 7 of the contract certificate.

(Hi) I have the authority to sign this certificate on behalf of the Contractor named below.

Signed Position held For and on behalf of Name and Address of Contractor

Date

NOTE.—For the purpose of this declaration the United Kingdom includes Channel Islands and the Isle of Man.

R. J. REBELLO,

Chief Controller of Imports and Exports.

FRWrZD BY THE GENERAL MANAGER, GOVERNMENT OF INDIA PRE88, MINTO ROAD, HEW DELHI AND PUBLISHED BY THE MANAGER OF PUBLICATIONS. DELHI, 1970