While the exporters are elated by the new order, the customs and excise departments apprehend a surge in rackets, involving bogus drawbacks and other benefits linked to exports.

The finance ministry amended Rule 187 A of the Central Excise Rules, 1944 through a notification (no.36/98) on September 2. The new notification allows recognised export houses and those firms which had paid a revenue of Rs 10 crore in the previous year to seal the good and containers by themselves without the need of the customs and excise officials' inspection.

The certificate of sealing the packages or containers can now be issued by the owner, working partner, managing director, company secretary or a person designated by the board of director of the concerned company.

The notification provides that themanufacturer-exporter will be required to give a 24-hour notice in advance to the concerned assistant commissioners of concerned central excise range or customs before the intended removal of the export cargo.

Hitherto, all export cargoes stuffed at the place of despatch were required to be done under the inspection of an officer of central excise or customs. These officers used to issue a certificate and seal the packages or containers.

This was being done mainly because of the incentives available to the exporters under various schemes like drawback, duty credit in passbooks or advance licences entitlement. Most of these schemes are related to either waiver of import duty on imports of raw stocks or cash incentives like drawback.

Since the exports are linked with such benefits, it was found necessary by the revenue department to keep a track of the goods exported through its field formations to ensure proper disbursement of incentives. Despite such checks, large-scale frauds involving drawback runninginto several hundred crores have recently come to light.

Similarly, large-scale frauds relating to duty entitlement passbook scheme also came to light, wherein large amounts of credit was being sought merely on the strength of forged documents.

In such cases, no exports were ever effected. But, the duty credit was sought, and in some cases endorsed. Such fraudulently availed duty credits were then sold in the domestic market to importers of various goods for a premium of 4-5 per cent.

There are recognised export houses which are basically involved in trading and their main profits are through the export-linked benefits. Many of these recognised groups are also under investigation for various frauds and violation of norms by various preventive agencies.

This has been happening despite the checks being maintained on the export cargo. Now, a specified group of exporters is being allowed to certify itself about its consignments, which may lead to large-scale frauds.

Even the Economic Intelligence Bureau(EIB) had been laying emphasis on more stringent checks on export goods which are linked with incentives. However, the government had ignored the suggestion so far.

According to the preventive agencies' estimate, there is a group of recognised export houses which is basically thriving on the export-linked incentives through large-scale fraudulent exports.

Along with genuine exporters, these parties are likely to reap rich benefits of the new provisions.

However, the provisions will help genuine exporters in avoiding delays on account of inspections by the authorities.