CHAPTER-8

DEEMED EXPORTS

Policy

8.1

The Policy relating to Deemed Exports is given in Chapter-8 of the Foreign Trade Policy.

Criteria for claiming Deemed Exports Benefits

8.2.1

In respect of supplies under Paragraph 8.2(a) of the Policy, the procedure for issue of ARO and Back-to-Back Inland Letter of Credit is given in paragraphs 4.14 and 4.15 of the Handbook.

 

8.2.2

In respect of supplies under paragraph 8.2(b) of the Policy and DFRC, the deemed export benefits may be claimed from the Development Commissioner or the Licensing Authority concerned. Advance Licence and DFRC shall be claimed from the concerned licensing authority. Such supplies shall be certified by the receiving agencies.

 

8.2.3

In respect of supply of capital goods under paragraph 8.2 (c) of the Policy, the supplier shall produce a certificate from the EPCG License holder evidencing supplies/ receipt of the manufactured capital goods.

 

8.2.4

In respect of supplies under categories mentioned in paragraphs 8.2(d),(e),(f),(g), (i) and ( j ) of the Policy, the application for advance licence shall be accompanied with a project authority certificate in Appendix - 27. The payment against such supplies shall be certified by the Project Authority concerned in the prescribed format in Appendix-22C.

 

Procedure for claiming Deemed Exports Drawback & Terminal Excise Duty Refund/Exemption from payment of Terminal Excise Duty.

8.3.1

The procedure for claiming benefits under paragraph 8.3 (b) and (c) of the Policy shall be as under:-

(i) An application in the Aayaat Niryaat form along with the documents prescribed therein, shall be made by the supplier to the Regional Licensing Authority concerned. The recipient may also claim the benefits on production of a suitable disclaimer from the supplier along with a self declaration in Appendix 22C of Handbook regarding non-availment of CENVAT credit in addition to the prescribed documents.

(ii) In case of supplies under paragraph 8.2(a), (b) & (c), the claim shall be filed against receipt of payment through normal banking channel in the form given in Appendix 22B. Such claims shall be filed within a period of 6 months from the last date of the month of receipt of payment.

(iii) In respect of supplies under paragraph 8.2(b) of the Policy where the supplier wants to claim benefits from the licensing authority, the Licensing Authority while allowing deemed export benefits to the DTA supplier, will endorse a copy of the communication to the concerned Development Commissioner along with the details of invoices against which deemed export benefits have been allowed for confirmation of the transaction involved.

(iv ) In respect of supplies under categories mentioned in Paragraphs 8.2(d )( e )(f ) (g ) (h) ( i ) &( j ) of the Policy, the claim may be filed for the payment received/supplies effected during a particular month/quarter/half year as per the option of the applicant either on the basis of proof of supplies effected or payment received. The claim may be filed either against a particular project or all the projects. Such claims shall be filed within a period of 6 months from the end of monthly/quarterly/half yearly period reckoned from the date of receipt of the supplies by the project authority or from the date of receipt of the payment as per the option of the applicant. Such claims may also be filed where part payments have been received.

 

8.3.2

For claiming exemption from payment of terminal excise duty, procedure prescribed by the Central Excise Authority shall be followed.

 

8.3.3

Where All Industry Rate of Drawback is not available or the same is less than 4/5th of duties actually paid on the materials or components used in the production or manufacture of the said goods, the exporter/ supplier may apply for fixation of brand rate in the application form as given in Aayaat Niryaat form to the regional licensing authority or Development Commissioner as the case may be.

 

8.3.4

The claim application shall be filed along with the application for fixation of brand rate of duty drawback in case brand rate is required to be fixed. The provision of late cut under paragraph 9.3 and supplementary claim under paragraph 9.4 shall also be applicable under this sub-paragraph.

 

8.3.5

Regional Licensing Authorities may consider provisional payment to the extent of 75% of the drawback claim in the case of private companies and 90% in the case of Public Sector Undertakings, pending fixation of Brand Rate.

 

8.3.6

Subject to the procedure laid down in this Handbook, the Customs and Central Excise Duty Drawback Rules, 1995 shall apply mutatis mutandis to deemed exports.

Procedure for claiming deemed export benefit by Sub contractor

8.4

 

In respect of supplies made by sub-contractor to the main contractor under paragraph 8.2 (d)(e) (f) (g)(i) and (j), the main contractor may make payment to the sub-contractor and issue payment certificate in the form given in Appendix-22C as Form 1-C. However, for supplies under paragraph 8.2(d) (e) (f) (g) and (j), the payment certificate from main contractor shall not be insisted for refund of Terminal Excise duty. The deemed exports benefits to the sub-contractor would be available to the extent of goods that are manufactured and supplied by him or outsourced from other manufacturers, for the value as indicated in Appendix 22C of the Handbook.