Export under No bond?

Question

Hi
In what case Export under no bond possible?
As per my knowledge for Export ARE-1 is required.
for ARE-1 creation Bond is required?
Does Export under no Bond means Export with LOU???
Reg,
Amol

Answer 1

In exports, under three methods, we can declare the excise returns.  They are
1)  Exports Under Bond
2)  Exports Under Letter of Undertaking and
3)  Exports under Rebate
1)  Exports Under Bond
Exporters are classified into two categories. Manufacturer-Exporters who manufacture and export  the goods in his own name without payment of excise duty and Merchant Exporters who buy the goods without payment of excise duty from a manufacturer and export the goods in his name.  For getting the goods without payment of duty, the merchant exporter has to necessarily execute a bond (standard forms are prescribed for various types of bonds, in which the assessee gives an undertaking to export the goods within a stipulated period as per the law).  The execution of bond is to ensure that in case of non-fulfillment of obligation, the central excise duty amount liable to be paid on the goods can be realized from him. Normally the bond is executed for an amount equivalent to the duty amount payable on the goods that the exporter is planning to export.  Whenever  the goods are cleared from the factory without payment of duty for export, the duty amount payable on the goods will be debited from the Running Bond Account.  Whenever the goods are actually exported (after the proof of export is received from the Division/Maritime Commissioner),  the manufacturer will take credit of the duty amount debited earlier by him.  The manufacturer also has the option to maintain a running bond account by executing a bond with the Central Excise authorities.    Though it is optional for a manufacturer-exporter to execute a bond for export clearances, it is very much necessary for merchant exporters. 
The other two will be followed separately due to format restriction.
thanks
G. Lakshmipathi