Circular No. 107/95-Cus.
dated 11/10/95
F.No. 602/12/95- DBK
Government of India
Ministry of Finance
Department of Revenue, New Delhi

Subject:  amendment of rule 8 of the Customs and Central Excise Duties Drawback Rules, 1995 to reduce monetory limit to Rs. 500/- and removal of minimum limit of 2% in case of export under duty Exemption scheme and exports by post-

 Attention is invited to Ministry’s telex of even number dated the 21st September, 1995 on the subject. Copy of Notification No. 53/95-Customs and Central Excises (NT) dated 18th September, 1995 was also enclosed with the post copy of the said telex.

2. The effect of the amendment is that the drawback shall now be payable in all cases where the amount of drawback exceeds Rs. 500/-. However in cases where the amount of drawback is less than Rs. 500/-, it should not be less than 2% of the F.O.B. value. This condition of minimum 2% of F.O.B. value will not be applicable in case exports are made by post and exports are made in discharge of obligation against Advance Licences issued under Duty Exemption scheme. Thus in case of exports made by post and exports under Duty Exemption Scheme, drawback shall be  payable in all cases wherever the amount of drawback is more than Rs. 50/-, the minimum limit specified statutorily is section 76 of the Customs  Act.

3. It should be carefully noted that in terms of rule 5(3) of the Customs and Central Excise Duties Drawback Rules, 1995, the provisions of section 16 of sub-section (2) of section 83 of the Customs Act determine the amount of drawback application to any goods exported under the said rules and the provisions of section 74/75 of the Customs Act, 1962 determine the relevant date for making drawback payments. Thus the amount or rate of drawback including the limitations specified in rule 8 as amended, are to be applied with reference to the date of “Let Export” order. Hence the relaxation made by the amendments in Notification No. 53/95-Customs and Central Excise (NT) shall be applicable only in respects of export goods for which an order to permit shipment under section 51 of the Customs Act is made on or after 18th September, 1995. That is the benefit to reduction of the ceiling limit for grant of DBK would not repeat would not be applicable to exports made earlier even though the claim for DBK in proper application has been made on or after 18.9.1995. This should be brought to the notice of all the concerned staff by a suitable S.O./ D.O could the contents are also suitable advised to Trade interests by a P.N./ T.N.

(A.K. Madan)
Under Secretary to the Government of India
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