LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Duty drawback query

Rubul (Student) (151 Points)

12 August 2015

Can we Avail duty drawback under the following conditions. If yes please provide me notification under which we can claim duty drawback.

We are merchant exporter of radio sets. We purchase goods from our supplier under cover of H form for sales tax and CT-1 for Excise. Goods are supplied directly to foreign client from the premises of our supplier.

Reply
Follow
Share

5 Replies

RAMESH KUMAR VERMA (Exim Officer) (5951 Points)
Replied 12 August 2015

The Merchant exporter is required to execute a bond in Form B-1,so that goods can be cleared by thE supplier manufacturer to Mertchant exporter without payment of duty. Merchant Exporter registered with recognised EPC and Star Export House do not have to furnish any security/surity while executing bond, unless they have come to the adverse notice of department - CBE&C circular No. 613/4/2001-CX dated 31-01-2002, confirmed in CBE&C circular No 711/27/2003-CX dated 30-04-2003. If bond is executed by Merchant Exporter, he will obtain certificates in form CT-1 from Superintendent of Central Excise on the basis of proforma Invoice provided by the supplier manufacturer to merchant exporter.

The exporter shall ensure taht debit in bond does not exceed the credit available in the bond any time. Forms of bond, letter of undertaking and CT-1 certificate have been given in Notification No 42/2001-CE(NT). If export is through merchant exporter ARE-1 form should be signed both by Merchant Exporter and as well as manufacturer exporter.

RAMESH KUMAR VERMA (Exim Officer) (5951 Points)
Replied 12 August 2015

Further NOTE THAT

There are several categories of supplies under the Deemed exports as provided in Chapter 8 of the Foreign Trade Policy, especially projects to be set up in power, refineries, fertilizers and petroleum/gas etc. They are entitled to exemption or refund of terminal excise duty, duty drawback or issue of advance authorization as is provided in the Policy. The refund of terminal excise duty can be claimed by the supplier or the recipient from the licensing authorities on submission of necessary documents.
MERCHANT EXPORTER:
The Merchant Exporter can procure the goods without payment of duty by furnishing the Bond and discharge the liability by furnishing the export documents to the Maritime Commissioner. CT-1 is required to be obtained after furnishing B-1 Bond by the Merchant Exporter.

Regards,

Rubul (Student) (151 Points)
Replied 12 August 2015

Dear Ramesh Thanks for your prompt reply. But my question is "can we calim duty drawback u/s75 of customs act for exported goods which are made from indigeneous material". Particularly when we are a merchant exporter not a manufacturer.

If yes, please provide me notification no. in which it is mentioned that goods which has been manufactured from indigeneous material and exported is also eligible for duty drawback.

RAMESH KUMAR VERMA (Exim Officer) (5951 Points)
Replied 13 August 2015

if your items occurs in the list of duty drawback items list Notified by DOR, Ministry of Commerce then admissible to take duty drawback incentive after export the goods out of india.on the other hand if you Procure goods from 100 @ EOU,/ SEZ UNITS ARE ADMISSIBLE FOR DEEMED EXPORT DUTY DRAWBACK. READ FOREIGN TRADE POLICY 2015-2020

Ramesh kumar

Ajit Hegde (CA - Final) (1367 Points)
Replied 05 September 2015

Mr. Rubul, if my understandin is proper, you are concerned with the domestic goods being sold which ll not have any custom duty impact and how you can claim refund of that? All industry rate of Duty drawback is notified after considering all the tax elements a good can contain. Even if it is manufactured locally, directly or indirectly it will have duty & tax costs incurred. Accordingly the rates are notified. You can go ahead for the claim of drawback.