I have been practicing as
for the last 35 years
A Chartered Engineer is a member of Institution of Engineers (India). The Institute grants him certificate to act as "Chartered Engineer" based on his academic qualification and experience. Importers and Exporters require their services to certify the value of Goods/Equipment/Plant for Custom/Duty/drawback/excise purposes
1. EPCG Licence- Export promotion capital good scheme
The applicant may apply for EPCG licence along with a certificate from the independent chartered engineer on the proforma annexed to ‘Aayaat Niryaat Form’ certifying the end use of capital goods sought for import for its use at pre production, production or post production stage for the product undertaken for export obligation.
The Licensing Authority concerned shall, on the basis of the nexus certificate from an Independent Chartered Engineer (CEC) submitted by the applicant in Appendix 32A, issue the EPCG licence and thereafter forward a copy of the EPCG licence to the concerned Jurisdictional Central Excise Authority.
2. Installation certificates
At the time of final redemption of export obligation licence holder shall submit certificate from the Independent Chartered Engineer confirming the use of spares so imported in the installed capital goods on the basis of stock & consumption register maintained by licence holder.
3. Import into SEZ
Special Economic Zone (SEZ) is a specifically delineated duty free enclave and shall be deemed to be foreign territory for the purposes of trade operations and duties and tariffs. Chartered Engineer has to issue certificate in the following manner
" This is to certify that list of items countersigned in the following annexure are required for M/s ( name of applicants ) for authorised operation approved by B.O.A vide letter no. dated "
4. Chartered Engineer's (CE Certification) for Second Hand Plants, Machinery Exported to India :
It is mandatory to have CE Certification for custom's clearance for second hand plant & machinery being imported to India. The certification relates to state of the goods, balance future life, contents, value for assessment of customs
5. Pre-Shipment Inspection (General):
As per WTO agreement "Agreement shall apply to all pre-shipment inspection activities carried out on the territory of Members, whether such activities are contracted or mandated by the government, or any government body, of a Member."
Pre-shipment inspection activities are all activities relating to the verification of the quality, the quantity, the price, including currency exchange rate and financial terms, and/or the customs classification of goods to be exported to the territory of the user Member.
For export to countries with import certification schemes, Pre-shipment inspection is a necessary step to receive an import certificate for the shipment. Without this certificate, the shipment will not be able to clear customs in the country of destination.
Pre-shipment inspection offers importers the certainty that the goods arriving at their place of destination are in conformity to required specifications. These can be customer's own requirements or legal demands or may be demanded by the Bankers
6 . Advance licence
An advance licence is granted for the import of inputs without payment of basic customs duty. Such licences are issued in accordance with the policy and procedure in force on the date of issue of the licence and is subject to the fulfilment of a time-bound export obligation, and value addition as maybe specified. Advance licences maybe either value based or quantity based.
Chartered Engineer has to certify that inputs being imported without payment of basic customs duty is in order .
7. Export of defective parts/equipments which cannot be repaired in India
Chartered Engineer has to certify that part of an imported machine cannot be repaired in India and has to be sent back to the manufacturer's or supplier's works for repairs and re-import .
8. Exemption to goods supplied to service provider such as hotels or stand alone restaurants under served from India scheme ( GENERAL EXEMPTION NO. 27 )
Central Government exempts capital goods , office equipments , professional equipments , office furniture and consumables related to service sector business and food items from the whole of duty of excise and additional duty of excise subject to a certificate from independent chartered engineer confirming installation and use of the goods in the factory or premises within 6 months from date of clearance .
Managed hotel means hotels managed by a three star or above hotel/hotel chain under an operating management contract for a duration of at least three years between operating hotel/hotel chain and hotel being managed. The management contract must necessarily cover the entire gamut of operations/management of managed hotel
9. Certification of DBK1 statement by independent chartered engineer for claiming duty drawback on all industry rates/fixation of drawback rates/refund of terminal excise duty
The chartered engineer has to certify the consumption of various materials shown in DBK-1 statement after examining it carefully that items are actually required and are being consumed in the factory of production for manufacture of export product . He has to further certify that imported materials are being actually used in the manufacture of the export product and are not being substituted by indigenous materials . The wastage claimed have to be certified as wastages should be reasonable and comparable to the general norms for the industry
10. Computation of Amortisation cost of tools ( Moulds/Dies ) used in the manufacture of components/parts
The amortisation refers to expensing the acquisition cost of tools minus residual value in a systematic manner over their estimated useful economic lives so as to reflect their expiration , obsolescence or other decline in value as a result of use with the passage of time .
11. CE cerrtification of investment in plant & machinery required by 100% EOU
The certification by chartered engineer is required for investment in plant & machinery for attaining the status of 100 % EOU ( Export oriented unit)
12. Computation of installed capacity of plant
The certification by chartered engineer is required for computation of installed capacity of new and old plants .
13. Item wise and cost wise details of food testing laboratory equipments certification
Recommendations from chartered engineer ( mechanical ) are required for buying both imported and indengous equipments for establishment of FOOD TESTING LABORATORY
14. CERTIFICTION OF BILL OF MATERIALS ( BOM ) submitted by SOLAR POWER DEVELOPERS
Chartered engineer has to certify BOM for setting up SOLAR POWER PROJECT which enables the developers to obtain customs/excise duty expemption certificates from MNRE ( Ministry of NEW and RENEWABLE Energy )
15. CERTIFICATION FOR MOEF - e waste
Chartered engineer has to certify whether imported equipment/machine can be considered as e-waste or not . Based on certification of CE, MOEF issues letter to importer which enables them to clear the equipment from customs.
Valuation is an opinion of an expert, who assesses the value of an asset. His assessment depends on the purpose for which the evaluation is sought, his honest judgement and the most important factor - his experience. It is a very interesting area and calls for a lot of serious work, expertise and experience on the part of valuer . Amount of work involved depends upon the size of the plant for which considerable preparation is necessary before physical inspection can be undertaken. No two plants or machines are the same . These may be different in designs , standards followed , technologies , sizes , capacities etc.
The valuer has to analyze the information collected from the unit which are documents and information available with the accounts department ; Fixed assets schedule giving list of plant & machines and other assets , purchase values including freight , installation expenses ( without pre-operative expenses and interest ) , year of purchase , technical specifications of plant & machinery
The information and factors that need to be considered during the analysis are listed below:
a. Purpose of valuation
b.Description of fixed assets such as plant & machinery, furniture, fixtures , fittings , electrical installations , computers , servers , office equipments etc.
c. Model description
d. Country of origin
e. Purchased new or old
f. Year of manufacture
g. Cost of similar type of new plant & machinery
h. Cost index in the year of purchase
i. Cost index on the date of valuation
j. Number of years for which the asset is in use
k. Import duty as the time of purchase
l. Import duty on the date of valuation
m. Exchange rates at the time of purchase and date of valuation
n. Accurate estimate of residual life of fixed assets
Valuer estimates or assesses the value professionally. He is an expert in his field. He is authorised to declare the worth of a particular commodity, may be it is property/machine/gold or any other item.
I have been practicing as independent surveyor & loss assessor since 1981. My expertise lies in assessing the losses in following categories of general insurance
a. Fire and allied perils
b. Engineering claims
c. Marine claims
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