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<h1>Dyed Yarn Fabrics Undergo Excise Duty, Qualify for DEPB Credit as Processed Cotton Made-Ups per Rules</h1> Fabrics made from dyed yarn that undergo processes such as bleaching, mercerising, dyeing, printing, or shrink proofing before export are subject to Central Excise duty and must be treated as processed fabrics for the purpose of Duty Entitlement Pass Book (DEPB) credit. Cotton made-ups derived from such processed yarn dyed fabrics qualify for DEPB rates applicable to processed cotton made-ups, not grey fabrics, as specified under relevant DEPB entries. Processes exempt from Central Excise duty include calendering, singeing, padding, and hydro-extraction. This clarification aims to prevent fraud in drawback disbursement and will be communicated to the trade through a public notice.