Procedure to surrender export incentive

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If an exporter receives a duty drawback but the goods are subsequently returned by the customer, the drawback must be surrendered. According to Rule 18 of the Customs and Central Excise Duties Drawback Rules, 2017, if export proceeds are not realised, the customs authorities will recover the drawback. You must notify your bank and customs about the return and repay the amount. If duty was paid upon re-importation, the duty drawback is no longer applicable.

Priya

Priya (Querist)
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29 April 2025 We are an exporter of medical products and are eligible for the duty drawback. We exported the product to our customer against an advance payment. Currently, the customer has returned the product as he is unhappy. We have to surrender the duty drawback. Please advise.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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29 April 2025 Rule 18 of the Customs and Central Excise Duties Drawback Rules, 2017, states that if the sale proceeds are not realized, the drawback paid will be recovered by customs authorities.

If the goods are returned and re-imported, you must inform customs and repay the drawback amount. This is because the export benefit was granted on the basis of the export, which is now nullified by the return of goods
Notify your authorized agent/bank and customs authorities about the return and initiate the process to repay the drawback amount.

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Priya

Priya (Querist)
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30 April 2025 Sir, Thanks for your reply.

Is there any option to pay online or to approach the customs office with a DD?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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30 April 2025 Yes, but only after getting the order from customs officer.

Priya

Priya (Querist)
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30 April 2025 Thanks, sir. We received the product through customs and paid the duty. Is it enough?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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