CIRCULAR NO. 11 /2005-Cus.
3rd March, 2005
F.NO.605/54/2004-DBK
Government of India
Ministry of Finance
Department of Revenue
Sub: Factoring of 2% Education Cess in Brand Rates and Special Brand Rates of Duty Drawback determined under Rule 6 and Rule 7 of the Customs & Central Excise Duties Drawback Rules, 1995-reg.
The undersigned is directed to invite your attention to the above mentioned subject and to say that a doubt has been raised as to whether 2% Education Cess needs to be factored in Brand Rates and Special Brand Rates of duty drawback determined under Rule 6 and Rule 7 of the Customs & Central Excise Duties Drawback Rules, 1995.
2. The matter has been examined by the Board. The Education Cess imposed in the Budget, 2004-2005 is leviable @ 2% of the aggregate duties of customs (except safeguard duty under section 8B and 8C, countervailing duty under section 9 and anti-dumping duty under Section 9A of the Customs Tariff Act, 1975) on all items imported into India. As Education Cess is being collected as duties of excise/customs, the element of Education Cess has been factored in All Industry Rates of Duty Drawback which were notified under notification No. 08/2005-Customs (NT) dated 18.1.2005. The Ministry has also issued a Circular (No. 3/2005-Cus dated 18.2.2005) clarifying the said position. In view of this, it has been decided that the element of Education Cess needs to be factored in the Brand Rates and Special Brand Rates of duty drawback determined under Rule 6 and Rule 7 of the Customs & Central Excise Duties Drawback Rules, 1995.
3. A suitable Trade Notice and Standing Order may be issued for the guidance of the trade and staff. Difficulties faced, if any, in implementation of the Circular may be brought to the notice of the Board at an early date.
4. Receipt of this Circular may please be acknowledged.
Yours faithfully,
Dr. M. Subramanyam
Deputy Secretary (DBK)
