Drawback Department
New Custom House,
Ballard Estate,
MUMBAI - 400 038.
Date : 28/3/2001
P.N. No.42/2001
IMP 1/2001
EXP 1/2001
PUBLIC NOTICE / STANDING ORDER
- Sub:
- Drawback on Ready-made Garments-Deduction from
f.o.b. value on account of imported / indigenous hangers.
Attention of all Officers/field formations/trade is invited to Drawback Circular
No.5/2001-Cus dated 19.01.2001 vide F.No.609/74/99-DBK, Govt. of India, Ministry
of Finance, Department of Revenue and Circular No.42/96 dated 12.08.96 on the
above mentioned subject.
Representation from the AEPC regarding deduction of the value of hangers from the
f.o.b. value of hangers packed garments for the purpose of allowing drawback has
been examined by the board.
It is observed that clarification have been received from the Board earlier vide
Circular 42/96 dated 12.08.96,
that drawback could be allowed under Section 74 of the Custom Act,1962, on the
hangers imported on payment of Customs duty when such hangers are re-exported
alongwith ready-made garments provided the value of the hangers is not included in
the value of garments.
For such benefit, the hangers and ready-made garments are declared as to distinct
commodities on the shipping bill though for the sake of convenience and on the
instructions of the overseas buyers, the hangers have been packed alongwith the
ready-made garments.
It is also clarified that the formulation of all Industry Rates of Drawback for Ready
made garments does not include
the duty incidence on hangers.
The hanges supplied alongwith the garments of sourced locally or they are
imported. The local procurement is against the price while the imported hangers
may have been supplied either free of charge or against payment.
Further as the hangers are procured through different modes. It is not possible to
lay down a uniform criteria to address the issues.
The Board has, therefore decided that :-
- Where the hangers are imported duty free under notification No.16/2000-Cus
dated 01.03.2000 and have been supplied free of charge, there value should not be
deducted from the value of the garments while computing the drawback
amount.
- However, if the hangers are imported on payment basis, there value have to be
deducted. In such cases, a suitable declaration should be obtained from the
exporters.
- If the hangers are locally procured, suitable deduction should be made from the
total value of the garments if the value of hangers is not declared separately and
deducted by the exporters.
- Where the hangers are imported on payment of duty, drawback under section
74 can be availed separately by the exporters in terms of Board"s Circulars
no.42/96-Cus dated 12.08.96.
- If their value is not separately indicated in the shipping bills, suitable amentments
to the declared f.o.b. value to arrive at the net f.o.b. value of the ready-made
garments exclusive of hangers, may have to be made.
- Proper varification as to the identity of the goods and duty payment thereon also
has to be done before drawback under section 74 is disbursed.
To enable the above, the exporters are required to give relevant declaration
regarding the value / duty payment / exemption / procured status of the hangers
supplied with the ready made garments.
All drawback claims may be decided accordingly.
Sd/-
(S.P.S. PUNDIR)
COMMISSIONER OF CUSTOMS,
EXPORT PROMOTION
ATTESTED
(A.k. CHAUDHARY)
DEPUTY COMMISSIONER OF CUSTOMS,
DRAWBACK DEPARTMENT,
MUMBAI.
F.No. S/10-108/2001 DBK