Revenue Releases New Drawback Schedule w.e.f. 21 Sept
Notification for the Revised All Industry Rates of Duty
Drawback Issued
To promote exports
with fair and representative rebate of the incidence of customs and central excise
duties and service tax related with the manufacture of export goods, the
Central Government had appointed an expert Committee headed by Dr. Saumitra Chaudhuri,
Member of the Planning Commission and of the Prime Minister’s Economic Advisory
Council, to interact with Export Promotion Councils and other stake holders and
rely on data to work out and recommend the All Industry Rates of duty drawback
on the basis of relevant parameters including prevailing prices of inputs,
rates of duty/tax and value of export goods.
The Central
Government, has taken into account the Committee’s recommendations, and
notified the revised All Industry Rates of duty drawback effective from 21st
September, 2013. Apart from the rate changes, to assist exporters, a large
number of rationalization measures have also been undertaken to realign
entries, provide rates on more items, better
differentiate all industry rates for export products with higher duty incidence
or to address classification issues on export products.
With the revised
rates, the Central Government will continue to support exporters with
substantial total drawback. Moreover, for expeditiously addressing exporters
concerns, the term of the Committee has been continued for another three
months.
[Customs Notification No. 98 (Non Tariff) dated 14th September 2013]
In exercise of the powers
conferred by sub-section (2) of section 75 of the Customs Act, 1962 (52 of
1962), sub-section (2) of section 37 of the Central Excise Act, 1944 (1 of
1944), and section 93A and sub-section (2) of section 94 of the Finance Act,
1994 (32 of 1994) read with rules 3 and 4 of the Customs, Central Excise Duties
and Service Tax Drawback Rules, 1995 (hereinafter referred to as the said
rules) and in supersession of the notification of the Government of India in
the Ministry of Finance (Department of Revenue) No.92/2012-Customs (N.T.),
dated the 4th October, 2012 published vide number G.S.R. 742
(E), dated the 4th October , 2012, except as respects things done or
omitted to be done before such supersession, the Central Government hereby
determines the rates of drawback as specified in the Schedule annexed hereto
(hereinafter referred to as the said Schedule) subject to the following notes
and conditions, namely:-
Notes and conditions:
(1) The tariff items and
descriptions of goods in the said Schedule are aligned with the tariff items
and descriptions of goods in the First Schedule to the Customs Tariff Act, 1975
(51 of 1975) at the four-digit level only. The descriptions of goods given at
the six digit or eight digit or modified six or eight or ten digits are in
several cases not aligned with the descriptions of goods given in the said
First Schedule to the Customs Tariff Act, 1975.
(2) The General Rules for the
Interpretation of the First Schedule to the said Customs Tariff Act, 1975 shall
mutatis mutandis apply for classifying the export goods listed in the
said Schedule.
(3) Notwithstanding anything
contained in the said Schedule, -
(i) all artware or handicraft items shall be classified under the
heading of artware or handicraft (of constituent
material) as mentioned in the relevant Chapters;
(ii) any identifiable ready to use machined part or component predominantly made
of iron, steel or aluminium, made through casting or forging
process, and not specifically mentioned at six digit level or more in Chapter 84 or 85 or 87, may be classified under the relevant tariff item
(depending upon material composition and making process) under heading 8487 or
8548 or 8708, as the case may be, irrespective of classification of such part or component at four digit level in Chapter 84 or 85 or 87 of the
said Schedule;
(iii) the
sports gloves mentioned below heading 4203 shall be classified in that heading
and all other sports gloves shall be classified under heading 9506.
(4) The figures shown in columns
(4) and (6) in the said Schedule refer to the rate of drawback expressed as a
percentage of the free on board ( f.o.b.) value or the rate per unit quantity
of the export goods, as the case may be.
(5) The figures shown in columns
(5) and (7) in the said Schedule refer to the maximum amount of drawback that
can be availed of per unit specified in column (3).
(6) The figures shown under the
drawback rate and drawback cap appearing below the column “Drawback when Cenvat facility has not been availed” refer to the total
drawback (customs, central excise and service tax component put together)
allowable and those appearing under the column “Drawback when Cenvat facility has been availed” refer to the drawback
allowable under the customs component. The difference between the two columns
refers to the central excise and service tax component of drawback. If the rate
indicated is the same in both the columns, it shall mean that the same pertains
to only customs component and is available irrespective of whether the exporter
has availed of Cenvat or not.
(7) Drawback at the rates
specified in the said Schedule shall be applicable only if the procedural
requirements for claiming drawback as specified in rules 11, 12 and 13 of the
said rules, unless otherwise relaxed by the competent authority, are satisfied.
(8) The rates of drawback
specified in the said Schedule shall not be applicable to export of a commodity
or product if such commodity or product is -
(a) manufactured
partly or wholly in a warehouse under section 65 of the Customs Act, 1962 (52
of 1962);
(b) manufactured
or exported in discharge of export obligation against an Advance Licence or Advance Authorisation
or Duty Free Import Authorisation issued under the
Duty Exemption Scheme of the relevant Export and Import Policy or the Foreign
Trade Policy:
Provided that where exports are made against Advance Licences
issued on or after the 1st April, 1997, in discharge of export obligations in
terms of notification No. 31/97 - Customs, dated the 1st April, 1997, or
against Duty Free Replenishment Certificate Licence
issued in terms of notification No. 48/2000-Customs, dated the 25th April,
2000, or against Duty Free Replenishment Certificate Licence
issued in terms of notification No. 46/2002-Customs, dated the 22nd
April, 2002, or against Duty Free Replenishment Certificate Licence
issued in terms of notification No. 90/2004-Customs, dated the 10th
September, 2004, drawback at the rate equivalent to Central Excise allocation
of rate of drawback specified in the said Schedule shall be admissible subject
to the conditions specified therein;
(c) manufactured
or exported by a unit licensed as hundred per cent. Export Oriented Unit in
terms of the provisions of the relevant Export and Import Policy and the
Foreign Trade Policy;
(d) manufactured
or exported by any of the units situated in free trade zones or export
processing zones or special economic zones;
(e) manufactured
or exported availing the benefit of the notification No. 32/1997–Customs, dated
01st April, 1997.
(9) The rates and caps of drawback
specified in columns (4) and (5) of the said schedule shall not be applicable
to export of a commodity or product if such commodity or product is –
(a) manufactured
or exported by availing the rebate of duty paid on materials used in the
manufacture or processing of such commodity or product in terms of rule 18 of
the Central Excise Rules, 2002;
(b) manufactured
or exported in terms of sub-rule (2) of rule 19 of the Central Excise Rules,
2002.
(10) Where the export product is not
specifically covered by the description of goods in the said Schedule, the rate
of drawback may be fixed, on an application by an individual manufacturer or exporter
in accordance with the Customs, Central Excise Duties and Service Tax Drawback
Rules, 1995.
(11) The rates of drawback specified
against the various tariff items in the said Schedule in specific terms or on ad
valorem basis, unless otherwise specifically provided, are inclusive of
drawback for packing materials used, if any.
(12) The term “dyed”, wherever used
in the said Schedule in relation to textile materials, shall include yarn or
piece dyed or predominantly printed or coloured in
the body.
(13) In respect of the tariff items in Chapters 60, 61, 62 and 63 of the said
Schedule, the blend containing cotton and man made fibre shall mean that content of man
made fibre in it shall be more than 15% but
less than 85% by weight and the blend containing wool and man
made fibre shall mean that content of man made fibre in it shall be
more than 15% but less than 85% by weight. The garment or made-up of cotton or
wool or man made fibre or
silk or noil silk shall mean that the content in it
of the respective fibre is 85% or more by weight.
(14) Wherever specific rates have been provided
against tariff item in the said Schedule, the drawback shall be payable only if
the amount is one per cent. or more of free on board
value, except where the amount of drawback per shipment exceeds five hundred
rupees.
(15) The expressions “when Cenvat facility has not been availed”, used in the said
Schedule, shall mean that the exporter shall satisfy the following conditions,
namely:-
(a) the exporter shall declare,
and if necessary, establish to the satisfaction of the Assistant Commissioner
of Customs or Assistant Commissioner of Central Excise or Deputy Commissioner
of Customs or Deputy Commissioner of Central Excise, as the case may be, that
no Cenvat facility has been availed for any of the
inputs or input services used in the manufacture of the export product;
(b) if the goods are exported
under bond or claim for rebate of duty of central excise, a certificate from
the Superintendent of Customs or Superintendent of Central Excise in-charge of
the factory of production, to the effect that no Cenvat
facility has been availed for any of the inputs or input services used in the
manufacture of the export product, is produced;
Provided that the certificate regarding non-availment
of Cenvat facility shall not be required in the case
of exports of handloom products or handicrafts (including handicrafts of brass artware) or finished leather and other export products
which are unconditionally exempt from the duty of central excise.
(16) Whenever a composite article is exported for
which any specific rate has not been provided in the said Schedule, the rates
of drawback applicable to various constituent materials can be extended to the
composite article according to net content of such materials on the basis of a
self-declaration to be furnished by the exporter to this effect and in cases of
doubt or where there is any information contrary to the declarations, the
proper officer of customs shall cause a verification of such declarations.
(17) The term ‘article of leather’ in Chapter 42 of
the said Schedule shall mean any article wherein 60% or more of the outer
visible surface area (excluding shoulder straps or handles or fur skin
trimming, if any) is of leather notwithstanding that such article is made of
leather and any other material.
(18) The term “dyed” in relation to fabrics and yarn
of cotton, shall include “bleached or mercerized or printed or mélange’’.
(19) The term “dyed” in relation to textile
materials in Chapters 54 and 55 shall include “printed or bleached”.
(20) In respect of the tariff items appearing in
Chapter 64 of the said Schedule, leather shoes, boots or half boots for adult
shall comprise the following sizes, namely: -
(a) French point or Paris point or Continental
Size above 33;
(b) English or UK adult size 1 and above; and
(c) American or USA adult size 1 and above.
(21) In respect of the tariff items appearing in
Chapter 64 of the said Schedule, leather shoes, boots or half boots for
children shall comprise the following sizes, namely: -
(a) French point or Paris point or Continental
Size upto 33;
(b) English or UK children size upto 13; and
(c) American or USA children size upto 13.
(22) The drawback rates
specified in the said Schedule against tariff items 711301, 711302 and 711401
shall apply only to goods exported by airfreight, post parcel or authorised
courier through the Custom Houses as specified in para
4A.12 of the Hand Book of Procedures (Vol. I), 2009-2014 published vide Public
Notice No.1 (RE-2012) / 2009-2014 dated the 5th June, 2012 of the
Government of India in the Ministry of Commerce and Industry, after examination
by the Customs Appraiser or Superintendent to ascertain the quality of gold or
silver and the quantity of net content of gold or silver in the gold jewellery
or silver jewellery or silver articles. The Free on Board (FOB) value of any
consignment through authorised courier shall not exceed rupees twenty lakhs.
(23) The drawback
rates specified in the said Schedule against tariff items 711301, 711302 and
711401 shall not be applicable to goods manufactured or exported in discharge
of export obligation against any Scheme of the relevant Export and Import
Policy or the Foreign Trade Policy of the Government of India which provides
for duty free import or replenishment or procurement from local sources of gold
or silver.
2. All claims for duty drawback shall be filed
with reference to the tariff items and descriptions of goods shown in columns 1
and 2 of the said Schedule respectively.
3. This notification shall come into force on
the 21st day of September, 2013.