wheat export: Centre warns of CBI motion in opposition to post-dated wheat export letter of credit score

The federal government on Monday mentioned that it’ll provoke proceedings beneath the Overseas Commerce Act and will additionally take the assistance of CBI and Financial Offence Wing in opposition to exporters who’ve issued post-dated Letters of Credit score past Could 13.

In a discover, the Directorate Basic of Overseas Commerce additionally mentioned that the federal government will take all essential motion in opposition to these banks that are discovered complicit with exporters in issuing post-dated LCs because it has been “apprehended that a number of the exporters are making use of for registration certificates from RA (regional authorities) primarily based on improper paperwork and subsequently extra checks should be put within the system”.

“In instances the place the LC date is on or previous to Could 13 however the swift message/message alternate date between the Indian and international financial institution is after Could 13, the RA might conduct full investigation (if required, by way of exterior specialists) and if these are discovered to be ante-dated, quick proceedings beneath the FT (D&R) Act must be initiated in opposition to the exporter,” the DGFT mentioned.

The federal government had banned wheat on Could 13 however allowed exports in opposition to legitimate irrevocable LCs issued on or earlier than then as a transitional association.

Later, it directed to get the LCs registered to make sure that solely exporters with legitimate and real LCs bought the ultimate nod.

“Such instances will probably be additional examined for referring to enforcement companies like EoW/CBI,” it mentioned, including that in case of complicity of any banker the place ante-dating is established essential proceedings as per regulation will probably be initiated.

It additionally mentioned that so as to plug the loopholes, RAs of the directorate will do bodily verification of all LCs whether or not already permitted or beneath course of and twine in skilled companies apart from making certain validation or endorsement by recipient banks.

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