Merchant exporter does have manufacturing unity

[Dinesh kumar]

Why does a merchant exporter obtain an advance license when he exports raw materials even though he doesn’t have a manufacturing unit? How does he use the raw materials?

AI Summary

Merchant exporter without factory can get advance authorization via contract manufacturing, job-workers or SEZ supplies but must track materials A merchant exporter without a manufacturing unit may obtain an advance authorization to legally source duty-free raw materials for producing export goods by contracting manufacture with a third-party, using an approved job-worker, supplying inputs to a notified zone/SEZ, or by fulfilling processing/export obligations under relevant licensing schemes. Use of materials must be tracked and evidenced-physical movement, job-work agreements, proof of export and fulfillment of export obligations-to claim duty benefits or exemptions; noncompliance can trigger penalties, recovery of duties and cancellation of the authorization.