The Solvent Extractors’ Association (SEA) of India has said the confusion over the TRQ (tariff rate quota) for the import of crude sunflower oil and soyabean oil may impact edible oil availability in the market.

In his monthly letter to the members of SEA of India on Wednesday, Ajay Jhunjhunwala, President of SEA of India, said the DGFT (Directorate-General of Foreign Trade) had issued public notices according to which the validity of TRQ issued during FY23 for the import of crude sunflower seed oil and soyabean oil shall be valid for clearance of import for a period till June 30, provided the Bill of Lading date is March 31 or before.

“Unfortunately, the Customs is insisting for Bill of Entry and not accepting Bill of Lading date. Hence, shipments are held up since April 1, 2023. This may also lead to shortage and also rise in the price of edible oils,” he said.

“The association has strongly taken up the issue with the Department of Food and Public Distribution and also the DGFT to allow crude sunflower and soyabean oils based on the Bill of Lading date as notified by the DGFT. We are expecting that matter will be resolved shortly,” he said.

Show cause notice

The SEA of India has said the “show cause notice” issued to the purchasers of scrips under MEIS (Merchandise Exports from India Scheme) and SEIS (Service Exports from India Scheme) is not in resonance to promote exports.

Jhunjhunwala said many companies, including the members of SEA of India, have purchased and used the scrips allotted by the DGFT to the exporters of goods/services. To their dismay, they have received ‘show cause notice’ that the exporter had fraudulently availed/obtained the benefit of MEIS/SEIS scrips by misclassifying the description of the goods/services exported by them under wrong chapter headings, or availed higher rate of MEIS/SEIS scrips than the rate prescribed for the goods/services exported by them, and that the goods imported using the scrip could be confiscated.

He said DRI (Directorate of Revenue Intelligence)/Customs authorities have failed to understand the fact that DGFT has issued said scrips to the exporters only after extensive verification of documents submitted by the exporter and satisfaction of various conditions imposed under the Foreign Trade Policy.

At the time of purchase, these scrips are valid and subsisting and there was no caveat on the said scrips by the Customs or the DGFT authorities and there was no material evidence whatsoever to doubt the authenticity of scrips, he said.

Stating that the issue of “show cause notice” to the importers in principle is a very detrimental step, he said it is bad in spirit. The association has urged Finance Minister Nirmala Sitharaman to drop recovery proceedings against importers, impose the liability on exporters and issue a notification making importers not liable for the misdeeds of the exporters who sold the scrip, he said.

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