customs Duty for IMPORTED Raw Materials

[RAMAKRISHNA M]

We are Importing products from Italy and supplying to SEZ / EOU's in India

after supplying these products SEZ / EOU units with warranty period of 2 years.

with in 2 years any repairs, we need to do free process.

For Process & Repairs, need IMPORTED RAW MATERIALS.

IF WE IMPORT THOSE RAW MATERIAL, IS CUSTOMS DUTY IS APPLICABLE OR NOT

thanks & regards,

​​​​​​​Ramakrishna.M

[Nash Industries I Pvt Ltd]

Appears you are a trader and if so.Customs duty is payable.

[RAMAKRISHNA M]

thank you Mr.Ramaswamy.

We are supplying to SEZ/EOU's.

After Sales, for repairing we bring it back with DC as repair and return since it was under warranty.

for Repairing, we required Imported Raw Materials and these Raw Materials will clear from customs after remitting duty as per norms. which is clarified in above discussion.

For these Imported Raw Material, can we get duty Draw back because we are supplying to SEZ / EOU's only.

It is like deemed exports only and whether we are eligible to get Duty Benefit in the above process.

Please clarify.

regards,

Ramakrishna.M

[Nash Industries I Pvt Ltd]

Deemed exports are treated at par with regular suppliles as of now. i.e. IGST is payable.

As far as BCD is concerned and suppyling to EOU, no exemption is allowed until underless the goods are exempted by any other notification.

As a service provider, exemption can be claimed if the goods are notified and follows the procedure prescribed under Customs Notification 68/2017 (NT).

For process (or manufacturing), only BCD is exempted subject to following the procedure 58/2003 as amended by notification 59/2017 and 68/2017 (NT).

[RAMAKRISHNA M]

Whereas you had mentioned that how to apply for exemption of Customs Duty but we are asking for Duty draw back for Imported Raw material purchased for Process. (this Imported Raw Materials will be utilised for products which are under warranty and same raw material was utilised for repairing process)

After repairing products with help of imported Raw Materials, is it possible to get the Duty Draw Back for the same.

regards, Ramakrishna.M

[Nash Industries I Pvt Ltd]

Only EOU is eligible to claim the refund of the duties/taxes DTA unit is not eligible.

Duty Drawback is not available for clearances to EOU.

[Kishan Barai]

According to the query posted above, import duty would be applicable, customs duty would have been exempted if supply made to international market where shipping bill and LEO number is obtained where B/E is filed with S/B number mentioned and "Replacement" has been ticked on ICEGATE portal by CHA.

According to my view, Duty drawback would be available as supply to SEZ would be considered as Exports in above case.

Thank You

AI Summary

Customs duty on imported repair materials may be payable, with limited BCD exemptions and restricted duty drawback availability. Imported raw materials used for warranty repairs on goods supplied to SEZ/EOU are generally subject to customs duty unless exempted; BCD exemptions for inputs used in processing/manufacture require compliance with prescribed procedures under the relevant customs notifications, service-provider exemptions apply only where goods are notified and procedures are followed, IGST treatment applies to deemed exports, and Duty Drawback is described as unavailable for clearances to EOU while EOUs may claim refunds of duties/taxes but DTA units may not.