Duty Drawback - CBEC's Customs Manual 2023 - Customs

Chapter 22: Duty Drawback 1. Drawback on re-export of imported goods 1.1 Duty Drawback on export of duty paid imported goods is allowed in terms of Section 74 of Customs Act, 1962 read with Re-export of Imported Goods (Drawback of Customs Duties) Rules, 1995. The goods are to be entered for export within two years from date of payment of duty on importation thereof. Under certain circumstances this period may be extended upto one year by the Principal Chief Commissioner/Chief Commissioner of Customs and beyond that by the Board. [Refer Notification No.33/94-Cus(N.T.) dated 01.07.1994] 1.2 Application by exporter is required to be made within 3 months from the date on which an order permitting clearance and loading of goods for exportation is made by the proper officer. This period may be extended up to 12 months from such date of order subject to conditions and fee payment. [Refer Circular No.13/2010-Cus., dated 24-6-2010] 1.3 A portion of the Customs duty paid at the time of import is given back as duty drawback, subject to certain procedure and conditions including identification of export goods with those imported on duty payment and their usage. Where the goods are not put into use, ninety eight per cent of Duty Drawback is admissible. Otherwise drawback is granted based on period of use. Used goods do not get Drawback if exported 18 months after import. [Refer Notification No.19-Cus., dated 6-2-1965] 1.4 On the issues of compliance to Rules, 1995 relating to manner and time of claiming drawback, identification, determination of and extent of use and other attendant aspects, all cases of drawback processing or denial are to be handled by way of detailed speaking order, following the principles of natural justice. Each such order is examined by the Commissioner for its legality and propriety. [Refer Circular No.35/2013-Cus., dated 5-9-2013] 1.5 The examination report on shipping bill for re-export must be recorded separately in a self-contained and explicit manner on each of the two aspects of identity and use. The examination report should not be made of phrases that are cryptic, generalised or sweeping in nature such as as per declaration , in such condition , found in order , found as declared , goods are same etc. [Refer Circular No.16/2016-Cus., dated 09.05.2016] 1.6 In order to prevent dual benefit while sanctioning drawback under Section 74 of the Customs Act, 1962, it may be ensured that a certificate duly signed by the Central/State/UT GST officer, having jurisdiction over the exporter is obtained, that no credit of integrated tax /compensation cess paid on imported goods has been availed or no refund of such credit or integrated tax paid on re-exported goods has been claimed. [Refer Circular No.21/2017-Cus., dated 30.06.2017] 1.7 The Pay and Accounts Office (PAO) under Chief Controller of Accounts, CBIC does the accounting and reconciliation of drawback payments after the receipt of monthly account from the concerned Commissionerates or Customs Houses.