Brand Rate Scheme for Exports under duty Exemption and DEPB Scheme.

In the case of an Advance Licence under the Duty Exemption Scheme, the Drawback shall be available in respect of any of the duty paid materials, whether imported or indigenous, used in the goods exported, as per the drawback rate fixed by Ministry of Finance (Directorate of Drawback). The Drawback shall, however, be restricted to the duty paid materials as indicated in the DEEC. The exports made under the DEPB Scheme shall not be entitled for drawback. The additional customs duty paid in cash on inputs under DEPB shall be adjusted as CENVAT Credit or Duty Drawback as per Rules framed by the Deptt. of Revenue. However, where the Additional Customs Duty is adjusted from DEPB, no benefit of CENVAT/ Drawback shall be admissible.

1. Brand Rate Scheme

It has been decided to grant Brand Rate to some of such export products in respect of duties paid on other inputs i.e. other than duty-free inputs used in production, based on the All Industry rates for such inputs and conversion stage duties of central excise levied on such intermediate stage products. The additional or countervailing duty paid in cash on imports under DEPB shall be adjusted as CENV A T credit or duty drawback:

Accordingly, Brand Rates under Rule 6 of the Customs and Central Excise Duties Drawback Rules 1971 /1995 have been determined in respect of several export products. The claims shall be settled at the relevant rates indicated in the relevant Public Notice. The materials allowed to be imported duty-free under Duty Exemption scheme have also been indicated separately. However, these rates would not be applicable to exporters for whom individual brand rates are announced. Moreover, drawback claims are to be settled only when such claims have been made in terms of Rule 11 or 12 of the Customs and Central Excise Duties Drawback Rules, 19953 or the provisions of the same/or any other requirement have been duly relaxed by the Central Government in terms of Rule 17 of the Drawback Rules, 1995.

In respect of the export products for which Brand rate has been announced, under Duty Exemption Scheme if the export goods are manufactured in terms of former Rule 191 A 4 or

Rule 191 B" of the Central Excise Rules, in respect of any indigenous excisable materials, such expor1 goods are not eligible for the rates specified in the relevant Brand Rate letter Such expor1ers shall apply for individual Brand Rates for their export product(s)

Packing Materials

The AI. rates of drawback as announced vide Public Notices are inclusive of drawback on packing materials used, if any, in the product exported Hence, no drawback is admissible, unless otherwise indicated specifically in the Brand Rate letter.

Applications

Where the "brand rate" has not been announced, it can be got fixed by sending the application in usual proforma (Annexure 46) along with Drawback Statements 1,11, IIA, III and IIIA (47 to 51) prescribed under the normal scheme (as against simplified scheme) for fixation of drawback However, if application is filed under Simplified Scheme, follow the procedure detailed in Chapter 15 Superscribe the application as -

"Brand Rate under Duty Exemption Scheme".

Give details of the duty free inputs (imported or indigenous under replenishment clause) in DBK-I and indicate against them that they are used under the Duty Exemption Scheme. These inputs. however. should not figure in DBK-II.

Specified Period Scheme

The Brand Rate Scheme for the specified drawback period (year) is as follows -

(i) A general Brand Rate letter (F.No. 609/131/92-DBK dated 31st July, 1992) has been issued to cover the period 1st June, 1992 to 31st July, 1992. The exporters, who had availed of the Duty Exemption Scheme, in terms of the licences issued under the Import-Export Policy as in force prior to 31st March, 1992, and who were entitled to some duty free imported materials, have been allowed reduced rates of drawback.

(ii) Drawback Public Notice No.6192, dated 31st July, 1992 has been issued to cover similar expor1s for the subsequent period.

(iii) Drawback Public Notice No.7192 dated 31st July, 1992, has been issued to cover cases of exports made under Quantity Based Advance Licences granted in terms of Para 51 of the Export-import Policy, 1992-97. As in terms of the said policy provisions, drawback has to be confined to the excise element only, the rates announced take care only of the Central Excise duty suffered on the inputs contained in the products exported.

(iv) There does not seem to have been issued any further notification in this regard, but see below.

Scheme Effective 1.4.95

The EXIM Policy, 1992-97 as amended on 31.3.95 and effective from 1.4.95, provides for levy of countervailing or additional duty of Customs both on all inputs imported under the value-based advance licensing (VABAL) scheme as well as quantity-based advance licensing (QABAL) scheme. The duty so paid can be drawn back either under the Modvat Scheme or Drawback Scheme

Modvat Credit. The countervailing or additional duly of customs paid on imported input can be claimed as Modvat Credit, wherever permissible under Rule 57A of Central Excise Rul81 or benefits of Rule 12(1)(b) or 13(1)(b) of same Rules can be availed of. Rule 13(1)(b) provide & for removal of specified materials without payment of duty from the place of manufacture a storage for use in the manufacture in bond of export goods. Rule 12(1)(b) permits grant of rebate of duty paid on materials used in the manufacture of goods, if such goods are exported outside India, etc. Moreover, declaration In this regard in the Shipping Bill will not be necessary in such cases.

Drawback. Under both the Schemes i.e. VABAL and QABAL, drawback of duties (both excise and customs) shall also be admissible except for drawback of basic customs duty 0" inputs permitted to be imported duty free under the Advance Licence.

However, drawback of customs duties shall be restricted to the imported inputs (other than for which exemption is claimed under Advance licence shown in list (b) under Part C of the DEEC. Duty Exemption Entitlement Certificate. Accordingly, claims of drawback on exports may, under Duty Exemption Scheme for which licences are to be issued on or after 1.4.95 will be entertained.

Drawback of additional duty or countervailing duty paid on inputs imported under the DEE (Duty Exemption Entitlement Scheme) will be. paid at the rate shown for "excise" in the column on "allocation" in the Drawback table. No brand rate needs to be got fixed in such cases.

Application Filed before Commencement of 1995 Rules
See Chapter 13.

2. All Industry (AI) Rate of Drawback on Exports Made before 2/5/95 in terms of Advance Licences issued on or after 1/4/95

The rates of drawback announced in terms of General Note 2(b) of the Drawback Rules issued on 15/6/95, shall apply in respect of export made before 2/5/95, if such exports were made in discharge of export obligations either in terms of Notif. No. 79/95-Cus. dt. 31/3/95 or in terms of Notif. No. B0/95-Cus. dt. 31/3/95.

Conversion of Free SBs into Drawback SBs

The Central Govt. has granted a general relaxation for conversion of all such free shipping bills into drawback shipping bills. for which a legal provision exists in terms of Rule 15 of Drawback Rules, 1995. See Chapter 1.