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Re-Export to SEZ, Customs - Import - Export - Customs - SEZ

Issue Id: - 116275
Dated: 6-5-2020
By:- Shekhar Poojary
Re-Export to SEZ

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Dear All,

Is Drawback under Section 74 will be applicable for supplies of imported goods to SEZ?

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Posts / Replies

Showing Replies 1 to 10 of 10 Records

1 Dated: 6-5-2020
By:- YAGAY andSUN

If you file Bill of Export and get it approved from Development commissioner before sending the goods to SEZ and payment is received in freely convertible currency, then, AIR DBK can be availed.


2 Dated: 7-5-2020
By:- DR.MARIAPPAN GOVINDARAJAN

I endorse the views of Yagay.


3 Dated: 8-5-2020
By:- Spudarjunan S

In addition to the suggestion of Shri.Yagay and Sun ji, you may aslo need to get a disclaimer certificate from the SEZ unit that drawback has not been claimed/availed of on the goods by the SEZ unit or the Developer.


4 Dated: 8-5-2020
By:- ASHOK PATRA

I think instead of AIR DBK, 98% of Custom duty paid will be granted.


5 Dated: 8-5-2020
By:- YAGAY andSUN

AIR Duty Drawback also come under Section 74 of the Customs Act, 1962. This 98% is now reduced to 95%.


6 Dated: 8-5-2020
By:- YAGAY andSUN

Please refer Notification No. 27/2006-Customs dtd.14h March, 2006

https://www.taxmanagementindia.com/visitor/detail_article.asp?ArticleID=5868


7 Dated: 3-8-2020
By:- Shekhar Poojary

Thanks All for the replies.

Dear Yagay, could you highlight the provisions where it specify that proceed should be in freely convertible currency.


8 Dated: 25-8-2020
By:- Abhishek Kumar

Dear Shekhar Pujary sir

The provisions of sub rule (3) of Rule 24 of SEZ Rules, 2006 may kindly be seen wherein it is clearly mentioned that Drawback shall be admissible to DTA supplier only if payments of supply are made from Foreign currency account of the SEZ unit. Thus Payment should be in convertible foreign currency only to avail drawback.


9 Dated: 28-8-2020
By:- Robert Kunnel

Hi,

For Re-export of Imported goods under Section 74 there are 2 parts (Used goods and Unused goods) if goods exported are used then deducted slab rates apply starting from 95% and if the same is unused then it is 98%.

AIR rates will not apply to re-export of goods imported as same applies to goods manufactured in India only.


10 Dated: 29-8-2020
By:- Subhash Modi

AIR of DBK applies to goods manufactured/processed in India when exported out of India or even to SEZ i.e. when it is an export and not a re-export. The relevant Section is 75/CA, 1962 read with Customs and Excise Duties Drawback Rules, 2017.

For re-export of imported goods the Section is 74 and the rules are Re-export of Imported Goods Customs duties drawback Rules, 1995.

If the re-export is made within 2 years from the date of import then 98% of customs duties paid is granted as DBK, if the goods are the same as imported and not put to any use.

However if imported goods are put to use and then sought to be re-exported then the same Section 74 and the 1995 rules will apply but with a difference that DBK will be granted at graded reducing rates starting from 95% if re-export is within 3 months lowering to 60% if re-export is within 18 months whether used sparingly or occasionally or frequently.

The same will apply to re-export to SEZ of goods procured from SEZ (import from SEZ).

A section 74 SB or Bill of Export has to be filed declaring whether taken or not taken for use import documents to match and justify the claim. There will be 100% AC/DC supervised physical verification at port of export or SEZ entry gate and then re-export allowed. EDF waiver will be required if no payment in FFE is to be realised with NFEI (no foreign exchange involved selected and AD code not inserted) or the SB by default will become EDF if the bank AD Code is inserted.

If for the amount of import IGST credit has been taken under GST then 98% or 95 to 60%, as applicable, DBK should be confined to amount of import BCD + Cess paid and export supply made either on payment of IGST under claim of refund or without payment under LUT. If no credit has been taken then DBK at the applicable 98 or from 95 to 60% should be claimed including the amount of import IGST.

From the overseas recipient or SEZ Unit the payment should be received in FFE within RBI prescribed time limit unless there was EDF waiver.


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