Drawback under brand rate letter cannot be denied for merchant exporter shipments if application covered such exports and safeguards are met.

Where a drawback rate application expressly contemplated exports through both self and merchant exporters, drawback under the brand rate letter could not be denied merely because the actual shipment was made by a merchant exporter. The benefit remained available, provided a disclaimer certificate was obtained from the merchant exporter and customs was satisfied that there was no double payment for the same export, and that the goods were in fact manufactured and cleared by the applicant and covered by the rate letter. The revision was allowed and the manufacturer's entitlement to drawback was upheld subject to verification of these conditions.

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Issues: Whether drawback under the brand rate letter was admissible where the goods were exported by a merchant exporter, although the manufacturer had applied for fixation of drawback rate stating that exports would be made through self and merchant exporters.

Analysis: The application for fixation of drawback rate was made by the manufacturer under Rule 6(1)(a) and Rule 7(1) of the Drawback Rules and specifically contemplated export through self as well as merchant exporters. On that basis, the benefit of the brand rate letter could not be denied merely because the actual export was effected by a merchant exporter. The benefit was, however, to be ensured only after obtaining a disclaimer certificate from the merchant exporter and satisfying that there was no double payment against the same export, and that the goods exported were in fact manufactured and cleared by the manufacturer and covered by the rate letter.

Conclusion: The revision was allowed and the drawback benefit was held admissible, subject to verification and the safeguards indicated above, in favour of the assessee.

Final Conclusion: The manufacturer's entitlement to drawback under the brand rate letter was upheld, with consequential relief directed subject to compliance with the prescribed conditions and verification by customs.

Ratio Decidendi: Where a drawback rate application expressly contemplates export through merchant exporters, the brand rate benefit cannot be denied solely because the goods were exported by a merchant exporter, provided the required disclaimer and anti-double-payment safeguards are satisfied.

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