Reversal of Custom duty as per para 6.08 FTP 2023 for DTA sales done by EOU unit

[Dashrath Walkoli]

Sir,            

We operate as an Export Oriented Unit (EOU) and currently benefit from import duty exemption on inputs under Notification No. 52/2003 Customs dated 31.03.2003, which are used in the production of our final finished goods. We also procure indigenous goods for the same production process.

As per FTP Para 6.08, we occasionally make DTA (Domestic Tariff Area) sales of our finished products.

My question is regarding the reversal of customs duty on these DTA sales. Specifically, should we reverse the customs duty only on the imported inputs consumed in the production of the finished goods sold in DTA, or should the reversal apply to the customs duty equivalent of both imported inputs AND indigenous goods that went into the production of those final finished products?

AI Summary

Reversal of customs duty required on imported inputs for DTA sales; domestic procurements can be treated as imports when deemed benefits availed
Reversal of customs duty is required on imported inputs consumed in finished goods cleared to DTA from an EOU under para 6.08. Circular guidance specifies that domestically procured inputs on which deemed export benefits were availed are to be treated as imported goods for DTA clearance and attract customs duty unless the unit opts to clear on payment of Central Excise and submits a Development Commissioner certificate confirming non availment or refund of deemed export benefits.