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March 2015

A. P. (DIR Series) Circular No. 74 dated February 9, 2015

By Gaurang Gandhi Chartered Accountant
Reading Time 1 mins
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Delay in Utilization of Advance Received for Exports

This circular requires banks to: –
1. Follow up with their exporter customers to ensure that export performance (shipments in case of export of goods), in cases where advances have been received for exports from overseas buyers, are completed within the stipulated time period.
2. Undertake proper due diligence so as to ensure compliance with KYC and AML guidelines so that only bonafide export advances flow into India. Doubtful cases and instances of chronic defaulters must be referred to Directorate of Enforcement (DoE) for further investigation.
3. Submit a quarterly statement indicating details of doubtful cases and chronic defaulters (as per Annex) to the concerned Regional Offices of RBI within 21 days from the end of each quarter.

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