Duty draw back under custom

[Krishan Gopal]

We have filed duty draw back claim u/s 74 of custom act for a machine return back after approx 2 years used, as per rules, we can claim duty draw back only 70% therefore we will suffer loss of 30% duty.Please advise that we can claim depreciation on cenvat 2.5% each quarter under rule 5 sub rule (5A) (b) of cenvat credit rule 2004 RegardsK.GOpal

[YAGAY and SUN]

Dear Krishan,

According to Section 76 (2) of the Customs Act, 1962, if the imported goods are used before re-export, the drawback will be allowed at a reduced percentage. If the goods were removed more than of 18 months, from the date of importation, then, NIL Drawback will be available. For details please refer Notification No. 23/2008-Cus dated 01-03-2008. In a result you won't get any Drawback under Section 74 of the Customs Act, 1962. Further, you would have to apply for permission from Board for getting the goods exported which are more than 2 years old otherwise you cannot export of said goods.

Regards,

YAGAY and SUN

(Management and Indirect Tax Consultants)

 

 

 

 

AI Summary

Duty drawback limitation for used imports: reduced or nil if exported after prolonged use; Board permission required.
Claim for duty drawback under Section 74 for a machine re-exported after extended use is barred where statutory rules reduce or extinguish drawback for used imports; beyond the prescribed time limit no drawback is available, and prior Board permission is required to export goods that have been in use beyond the regulatory threshold.