Circular No. 24/2001-Cus.
20th April, 2001.
F.NO.605/47/2001-DBKOnline GST Certification Course by TaxGuru & MSME- Click here to Join
Government of India
Ministry of Finance
Department of Revenue
Sub: Declaration under Rule 12(1)(a)(ii) of Drawback Rule for availing AIR of Drawback.
Export Promotion Councils have brought to the notice of the Board that certain Customs Houses are relying on the first proviso to Rule 3 of Customs & Central Excise Rules, 1995 & Declaration filed by exporters under Rule 12(1)(a)(ii) of the said Rules to seek evidence of payment of duties and evidence of import of inputs against individual consignments exported by individual exporters under claim for Drawback at All Industry Rate and this is creating undue delay in disbursement of drawback and harassment to genuine exporters.
The issue has been examined in the Board. All Industry Rate is based on the concept of averages, wherein the drawback rate itself as well as its customs and excise portions are based on weighted averages of consumption of imported / indigenous inputs of a representative cross section of exporters and the average incidence for duties suffered on such inputs. These rates have no relation to the actual input consumption pattern and actual incidence suffered on inputs of a particular exporter or individual consignments exported by any particular exporter under AIR/DBK Claim.
Therefore, it is clarified that, as a matter of rule, no evidence of actual duties suffered on imported or indigenous nature of inputs used, even if the All Industry Rate has customs portion, should be insisted upon by the field formations alongwith declaration filed by exporters under Rule 12(1)(a)(ii) of the Customs & Central Excise Duties Drawback Rules, 1995.
It is also pertinent to mention that the intention of the first proviso to Rule 3 is essentially to provide a guideline to the Directorate of Drawback as to how All Industry Rates of drawback will be determined in certain situations. It is not intended for the field formations to use this rule for arbitrarily altering the All Industry Rates of Drawback in the case of individual exporters for individual consignments.
Brief details of cases where proof of import of duty payment has been insisted upon for claims under All Industry Rates by the Custom House may be brought to the notice of the Board.
However, if the Department has any documentary evidence of fraud, the Custom Houses may initiate proper investigation with the prior written approval of the Commissioner.
This is in supersession of Board’s Circular NO. 23/2001-Cus. issued on 18.04.2001 on the above subject.