The Hindu Business Line : New import norms for metal scrap

THE Finance Ministry and the Directorate General of Foreign Trade (DGFT), it appears, have at last buried their differences over the import policy on metallic scrap.

The Revenue Department and the Department of Commerce had locked horns over the issue of stipulating 100 per cent inspection by the Customs authorities of all unshredded and loose metallic scrap imports into the country.

While the DGFT had late last week revamped the import policy on metallic scrap and dropped the 100 per cent inspection stipulation, the Central Board of Excise and Customs (CBEC) on Monday came up with new detailed procedures for clearance of imported metal scrap (both ferrous and non-ferrous).

Imports of metallic ferrous ores and metal scrap during the year 2003-04 stood at Rs 5,746 crore (Rs 5,022 crore during 2002-03).

As regards the new clearance procedures, informed sources said that the CBEC has decided to divide the metal scrap imports into two categories — (1) Scrap which has already landed in India and that which has left its port of origin on or before October 25, 2004 and which has not yet been cleared from a customs port, inland container depot (ICD) or Container Freight Station (CFS). (2) Scrap which is to be loaded for shipment to India after October 25. For the first category, the CBEC has held that the metallic scrap would be cleared after 100 per cent physical examination. Manufacturer-importers can also avail themselves of the facility of examination at their own premises. The local central excise officer can requisition the services of the local police for their advice/guidance or presence during the physical examination of the scrap.

As regards the second category — future imports of metal scrap (after October 25, ), the CBEC has held that import of scrap in shredded form would be permitted through all ports without any pre-shipment certificate. The examination in such cases may be limited to 10 per cent of the consignment subject to testing of minimum one container. The container so identified is to be examined 100 per cent.

For clearance of metal scrap in unshredded and loose form, the Revenue Department has held that the consignments need not be shifted to the premises of the importer (except for EOU and SEZ units).

The loose scrap would have to be accompanied with a pre-shipment inspection certificate and the examination would be 25 per cent of the containers in respect of manufacturer-importers and 50 per cent in respect of traders, for each import consignment, subject to examination of a minimum of one container.

The container selected would be examined 100 per cent. Where the electronic data interchange (EDI) is operational with Risk Management Module (RMM), the percentage of examination would be determined by RMM.

All consignments of unshredded scrap imported after October 25, without any prescribed pre-shipment inspection certificate would be subject to 100 per cent examination apart from stringent penal action for violation of provisions of the Foreign Trade Policy.

Imports of scrap in unshredded, compressed or loose form (after October 25) would be allowed for EOU/SEZ units only through the specified 15 ports (major ports).

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