Drawback - Fixation of brand  rate  of  duty drawback  by the  Central Excise  field  formations under  Rules  6  and  7  of  the  Customs  and  Central Excise  Duties  Drawback  Rules, 1995 -  Removal  of difficulties.

Document Text

Circular No. 89/20003-Customs 6th October, 2003 F.No.603/32 /2003-DBK Government of India Ministry of Finance Department of Revenue Central Board of Excise & Customs Sub: Fixation of brand rate of duty drawback by the Central Excise formations under Rules 6 and 7 of the Customs and Central Excise Duties Drawback Rules, 1995 - Removal of difficulties – regarding. field is Attention to Customs Circular Nos.14/2003 dated 83/2003 dated 18.9.2003, wherein detailed procedure as to the fixation of Brand Rate and Special Brand Rate has been explained. invited 6.3.2003 and on based 2. These instructions as well as the illustrations given therein field were formations are aware of the fact that drawback facility should not be allowed case the exporter has availed of input stage relief under various schemes i been ncluding learnt that some confusion persists in the minds of field formations. presumption however, facility. Cenvat has, that the It in in is of to In that duty order used inputs dispel doubts, drawback it aimed such scheme is 3. clarified at neutralising the input stage duties of Customs and Central Excise suff ered the various respect manufacture of the export products. Apart from duty drawback, exporters also have other schemes for claiming the relief of input stage duties of Central Excise through the Central Excise Rules, 2002 or rebate under Rule 18 of Cenvat Facility under the Cenvat Credit Rules, 2002. It is clarified here that if the input stage duties have been rebated through the instrumentality of any of these schemes, then simultaneous relief under Drawback scheme shall not be admissible. The field formations, therefore, the duty should ensure furnish drawback rate can be permitted only availing the Cenvat facility under Cenvat Credit Rules, 2002 (or earlier Rules), and if the exporters are the Central Excise allocation of evidence they that that not in rebate of the inputs/materials used under Rule 18 of the Central Excise Rules, 2002 (or the corresponding rule under the earlier Rules). However, if any of the inputs have suffered customs duty and drawback is admissible on it as per rules, the same may be allowed. of the have facility removing 4. Further, the field formations are also aware that manufacturers/ producers the materials (inputs) without payment of duty from the factory of the producer or the manufacturer or the warehouses or any other premises, for use in the manufacture which are exported with the approval of the Commissioner of Central Excise. Therefore, this facility also amounts to a relief of the input stage duties. be ensured that the exporters do not avail of the facility under Rule 19(2) of the Central Excise Rules, 2002 (or the corresponding rule under the earlier Rules). Hence, while processing drawback allowing should goods the or of it 5. Field formations should also note that under DEPB Scheme, drawback can only be allowed in terms of the Customs Circular no.39/2001 dated 6.7.2001. exempted. No 6. Similarly, under Advance Licence Scheme, the exporters get the facility of duty free import of the inputs required for the manufacture of export product. Therefore, the relevant import documents (Bills of Entry, etc.) should be carefully scrutinised to ascertain whether duties have been be fixed for such cases. However, Brand Rates can be fixed for rebating duties on such inputs which do not figure in relevant Advance Licence/DEEC Book and which have been procured by exporters indigenously or through import under the cover of proper duty paying documents i.e. Central Excise invoices or bills of entries, as the case may be, provided that the exporters do not avail of CENVAT facility in respect of the element of Central Excise duty or the Countervailing Duty (CVD) as the case may be. drawback should Rate of Brand On the other hand, 7. under Duty Free Replenishment Certificate Scheme, which is a post export scheme, the exporters are issued a DFRC Licence. The DFRC licence is freely tradeable in the market. The import of relevant inputs figuring in the Standard Input-Output Norm (SION), published in the Handbook of Procedures, Vol.II to the EXIM Policy, against a DFRC licence is exempted from the basic customs duty. But the importers are required to pay the countervailing duty (CVD) in cash. It is clarified here that the their export product by using exporters who manufacture the material imported against a DFRC licence, can be given brand rate of element respect of CVD provided they do not avail of Cenvat facility on the same. drawback such of in required simultaneously formations are to permit drawback on 8. In the revised scheme of the things, the brand rate letters are to be issued by the jurisdictional Central Excise authorities and the Customs field the strength of such rate letters. In order to ensure that the exporters do not of the relief of input stage benefits under various schemes, the brand rate letters issued should specify that the manufacturer exporters or is a merchant exporter) has not availed of the benefit of various schemes mentioned in paragraphs 3, 4, 5, 6 and 7 above. However, if brand rate has been fixed in respect of exceptional situations under these schemes as explained in the above referred paras, the brand rate letters should specify the same. the supporting manufacturers (in case the exporter avail 9. Suitable public notices for information of the trade and standing orders for guidance of the staff may kindly be issued accordingly. 10. The receipt of this Circular may kindly be acknowledged. S.S. Renjhen Joint Secretary to the Government of India Telefax No.23341079

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