Ct-1/ are-2 for sale to exporter

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Dear All,

We are manufacturers of custom made industrial goods. We are making a sale to an exporter. He says that they will provide Form CT-1 and thus the Excise duty will be nil. As per my research here on CAclub, we can provide the goods through forms ARE-1/ ARE-2.

Now our problem is that we are using imported components for our manufacturing and this material comes with Excise duty. We will not be able to utilize this Excise duty at the input through CENVAT credit as we usually have surplus duty. With respect to this, please answer my following questions:

  1. Can we use form ARE-2 to avail rebate of Excise Duty paid at input?
  2. Will our customer be able to claim Duty Drawback after we provide ARE-2?
  3. Is there any other way to recover the cost of Excise duty at the input?

Thank you,
Ankit

Replies (2)

you have to use ARE1 ( which will also be issued by the exporter and counter singed by manufacturer) for your clearance for onward exports ,

you can charge duty and he can avail rebate paid , but when CT1 is issued its useless to mention about duty rebate, keep your duty in your own account and use it somewhere else.  

ARE2 is used for bringing in duty free inputs / semi processed components to be used in the goods to be exported agiainst ARE1 

usually ARE2 is used in SEZ or EPZ for bringing in duty free inputs.

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