Export drawback recovery upheld where realisation of export proceeds was not proved within the statutory time limit

Drawback already sanctioned becomes recoverable where the exporter fails to establish realisation of export proceeds within the prescribed time under the Customs Act and the Drawback Rules. The statutory scheme permits recovery if proceeds are not realised within the time allowed under FEMA or any extension granted by the RBI. Here, the Bank Realisation Certificate did not mention the date of realisation, so timely realisation was not proved. On that basis, the requirement supporting retention of drawback was not satisfied, and recovery with interest and penalty was upheld.

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Issues: Whether drawback already sanctioned was recoverable when the exporter failed to establish realisation of export proceeds within the prescribed time and the Bank Realisation Certificate did not contain the date of realisation.

Analysis: The statutory scheme under Section 75(1) of the Customs Act, 1962 and Rule 16A of the Customs, Central Excise & Service Tax Drawback Rules, 1995 permits recovery of drawback where export proceeds are not realised within the time allowed under the Foreign Exchange Management Act, 1999 or any extension granted by the Reserve Bank of India. The record showed that the Bank Realisation Certificate produced by the exporter did not mention the date of realisation. In the absence of such proof, realisation within the stipulated period could not be accepted as established, and the exporter failed to discharge the statutory requirement supporting retention of drawback.

Conclusion: The drawback was recoverable, and the confirmation of recovery with interest and penalty was upheld.

Final Conclusion: The revision application failed on merits because the exporter did not prove timely realisation of export proceeds, so the revenue action sustaining recovery of drawback was maintained.

Ratio Decidendi: Where the exporter does not produce reliable evidence of realisation of export proceeds within the statutory time limit, drawback sanctioned earlier becomes recoverable under the drawback recovery provisions.

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