Export proceeds not received-DBK returned back-Self write off but permission not taken

[Ashok Chopra]

Respected Forum,

Export proceeds not received. No ECGC coverage. Foreign buyer gone into Liquidation (situation beyond the control of exporter) Drawback received returned to department voluntarily, but without interest. Export proceeds self written off in books but permission of self write-off not applied with A.D. Bank.

My queries:

1. What to do now about interest. Should we also deposit voluntarily, if do not deposit, what serious action by department.

2. How to take permission of self write-off now? if do not take permission, what serious action by department.

Please guide me accordingly.

[KASTURI SETHI]

1. Interest has to be paid from the date of clearance of goods from the factory for export .

2. No permission required. You have to do so in books of accounts and reflect the same in Balance Sheet (including Profit and Loss Account.

[YAGAY andSUN]

Please check Master Direction on export of goods and services which is issued by RBI on 1st January 2016. You will find your answer on Writing off .

You would have to pay the interest from the date of Let Export Order dated which is mentioned on Shipping Bill.

AI Summary

Interest on unpaid export proceeds is payable from LEO date; self write-off must be recorded in books without AD permission. Exporters whose buyers liquidate remain liable to pay interest on unpaid export proceeds from the Let Export Order or clearance date; voluntary return of drawback does not remove that obligation. A self write-off may be made in the accounting records and financial statements without prior permission from the Authorized Dealer, but exporters should follow the applicable Master Direction on writing off export receivables and ensure interest is computed from the LEO date.