Circular No. ES/226/2019-20 31st January, 2020
To: Members of the Council
Sub: CBIC notifies Revised All Industry Rates (AIRs) of Duty Drawback
As you are aware, the Central Government has announced the revised All Industry Rates (AIRs) of Duty Drawback vide Notification No. 7/2020– Customs (N.T.) dated 28th January, 2020 which shall be effective from 4th February, 2020.
Now, CBIC has issued Circular No. 06/2020- Customs dated 30th January, 2020 regarding salient features of the revised AIRs.
The salient features of the revised AIRs are as follows (Relevant Extract):-
Each tariff item in the Schedule annexed to the above mentioned Notification has been provided with an AIR specified under column (4) with cap of Duty Drawback amount given 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) 610901, the drawback serial no. should be declared as 610901B;
The notification also specifies in the Table annexed thereto, lower AIRs on export of items covered under Chapters 61 and 62 of the Schedule (viz. articles of apparel and clothing accessories) made under Special Advance Authorization Scheme (para 4.04A of Foreign Trade Policy 2015-20) in terms of Notification No. 45/2016-Customs dated 13.08.2016. For claiming the alternative AIR, the relevant tariff item has to be suffixed with suffix ‘D’ instead of the usual suffix ‘B’ mentioned above.
AIRs of Duty Drawback for items of MMF textiles (Chapter 54 to 63) have been increased on account of various factors such as changes in duties, price (CIF) of imported inputs, FOB value of export goods, import intensity of inputs etc.
AIRs have been rationalized for some readymade garments (Chapter 61–62) due to decrease in Basic Customs Duty (BCD) rate, changes in price (CIF) of imported inputs, FOB value of export goods, import intensity of inputs etc.
New tariff items in Textiles and readymade garments have been introduced in the Schedule.
Appropriate caps of duty drawback amount have been provided wherever felt necessary to prescribe upper limit of Duty drawback.
The Drawback Department has instructed the Commissioners with the following tasks-
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.
Need for continued scrutiny to prevent any excess drawback arising from mismatch of declarations made in the Item Details and the Drawback Details in a shipping bill.
The Drawback Department has informed the field formations regarding any changing trend of export valuation or drawback outgo in respect of goods where caps have been removed or increased as compared to the existing caps. It is further requested that any change in pattern should be immediately brought to notice of the Board. Commissioners may also inform, with appropriate data, the details of specific products where drawback cap needs to be reviewed or imposed.
In view of the above, members are once again requested to kindly go through the Drawback Schedule and send us your feedback/suggestions especially on anomalies if any, i.e. classification/ description of items and Drawback Rates/Caps etc., latest by 3rd February, 2020 to firstname.lastname@example.org / email@example.com so that the same can be taken up with the Government before the Drawback rates are implemented.
Members may kindly make a note of the above details and do the needful.