Duty drawback recoverable on delayed export realisation without RBI extension

Drawback already availed is recoverable where export proceeds are not realised within the period permitted under the Foreign Exchange Management Act, 1999, and no valid Reserve Bank of India extension is produced. Rule 16A of the Customs, Central Excise and Service Tax Duty Drawback Rules, 1995 authorises recovery in that situation, and delayed bank certificates do not cure the failure to prove timely realisation or an extended period. On the recorded facts, the export proceeds were realised beyond time and no RBI extension was shown, so the recovery of drawback was upheld.

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Issues: Whether drawback already availed was recoverable where the export proceeds were not realised within the permitted period and no extension from the Reserve Bank of India was produced.

Analysis: Rule 16A of the Customs, Central Excise and Service Tax Duty Drawback Rules, 1995 authorises recovery of drawback when the exporter fails to produce evidence of realisation of export proceeds within the period allowed under the Foreign Exchange Management Act, 1999, or within any extended period granted by the Reserve Bank of India. The records showed that the realisation of the export proceeds occurred beyond the stipulated period, the bank certificates reflected delayed realisation, and no RBI extension was produced. The subsequent production of certificates did not negate the statutory requirement to establish timely realisation or valid extension.

Conclusion: The drawback was rightly recovered and the challenge to the demand failed.

Ratio Decidendi: Where export proceeds are not realised within the prescribed period and no RBI extension is shown, drawback becomes recoverable under Rule 16A of the Drawback Rules.

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