Revised All Industry Rates of Duty Drawback

Circular No.ES/314 /2018-19                                                              December 13, 2018

To: Members of the Council


Revised All Industry Rates of Duty Drawback

Dear Member,

As you are aware, the Central Government has announced the revised All Industry Rates (AIRs) of Duty Drawback vide Notification No. 95/2018- Customs (N.T.) dated 6th December, 2018, which will come into force on 19th December, 2018.

Now, CBIC has issued Circular No. 52/2018- Customs dated 12th December, 2018 regarding salient features of the revised AIRs.

The salient features of the revised AIRs is as follows:-

  1. As announced in the last Drawback Schedule w.e.f. 1st October, 2017, the revised AIRs of Duty Drawback neutralize incidence of duties of Customs on inputs used and remnant Central Excise duty on specified petroleum products used in manufacture of export goods. Accordingly each tariff item in the Schedule annexed with above mentioned Notification has been provided with one AIR specified under column (4) with caps under column (5) in the Schedule. For claiming these AIRs, the relevant tariff item have to be suffixed with suffix ‘B’ e.g. for export of goods covered under tariff item (TI) 640609, the drawback serial no. should be declared as 640609B;

  1. The notification also specifies the alternative AIRs on garments exports made against the Special Advance Authorization (para 4.04A of Foreign Trade Policy 2015-20) in discharge of export obligations in terms of Notification No. 45/2016-Customs dated 13.08.2016. For claiming these alternative AIRs, the relevant tariff item has to be suffixed with suffix ‘D’ instead of the usual suffix ‘B’.

  1. The AIR of Duty Drawback for items of textiles (Chapter 54 to 63), readymade garments (Chapter 61-62) and made-ups (Chapter 63) have been increased on account of various factors such as change in duty structure, change in prices (CIF) of imported inputs and FOB of export goods, change in import intensity of inputs, etc.

  1. Rationalization of rates for some readymade garments (Chapters 61 & 62) have been done on account of various reasons viz. decrease in C. Ex. Duty rate on diesel, change in prices (CIF) of imported inputs and FOB of export goods and change in import intensity of inputs etc.

  1. New tariff items in Textiles and made-up (3 items) have been introduced in the Schedule.

  1. Appropriate caps have been provided wherever felt necessary to prescribe upper limit of Duty drawback.

The Drawback Department has instructed the Commissioners with the following tasks-

  1. To ensure due diligence to prevent any misuse by handling the shipping bills with parameters considered to be sensitive with adequate care at the time of export.

  2. To prevent any excess drawback arising from mismatch of declarations made in the Item Details and the Drawback Details in a shipping bill.

As informed earlier, members are once again requested to go through the Drawback Schedule and send us their feedback/suggestions especially on anomalies if any i.e. classification/ description and Rates/ Caps etc, with supporting data and documents latest by 17th December, 2018 to so that the same can be taken up with the Government. Since, the new Drawback rates are applicable w.e.f. 19th December, 2018, we request you to kindly send us the information immediately not later than 17th December, 2018.        

Members are requested to make a note of the above and do the needful at the earliest.

Thanking you,

Yours faithfully,