Duties Rebated Under Drawback Scheme

Under the drawback scheme, the relief is given from the burden of duty incidence of Customs & Central Excise on basic inputs like raw materials. Components, Intermediates and packing materials used at various stages of production / manufacture. No relief of drawback is extended to duties suffered on capital goods, fuels and consumables used in relation to the manufacture of the export goods. It may also be noted that no relief of Sales Tax or Octroi or any other indirect tax is given by way of drawback. The finished stage of excise duties on the export product is also not reimbursed under this scheme and there are separate provisions for rebate of such finished stage duties under the Central Excises and Salt Act 1944 and the Rules framed thereunder.

Interest Payment

A new Section 75 A has been incorporated in the Customs Act to provide for payment of interest on delayed payment of drawback. Interest at the rate of 15% P.A. is payable to the exporters if the claim is not settled within three months from the date of issue of acknowledgement by the department. Acknowledgement under Rule 13(I) is issued only if the claim is complete in all respect. If the claim is deficient, the department within 15 days from the date of filing the claim will issue a deficiency memo. The exporter is required to comply with the deficiency memo within 30 days from the date of receipt of deficiency memo. The time limit in these cases will be completed after receipt of compliance and issue of acknowledgement card.

Similarly, where an exporter has been paid erroneous or excess drawback and fails to repay the same within three months from the date of demand, he is liable to pay interest at the rate of 20% P.A.

Supplementary Claim

If the exporter finds that the amount of drawback paid is less than what he is entitled to, there is a provision for claiming supplementary drawback claims in the prescribed Format Under Rule 15 of the Drawback Rules, 1995. The time limit filing supplementary claim is three months from the date of original settlement.