REGARDING EXPORT EXECUTION

[SNEHAL SHAH]

Question:- Regarding Export Execution.
OPTION----1
Suppose: A----------------is a manufacturer(DTA unit)-----(SUPPLIER/EXPORTER))
B---------------- is a job worker(EOU unit)
C---------------is a foreign Customer
==> In view of the above, “A “wants to procure all raw materials/Consumables/Spares without payment of duty in this way, it may be import against Advance License and may be indigenous procurement under . Nofn.43/2001 CE(NT) dated 26.06.2001 for the purpose of manufacture or processing of export goods & their exportation out of India to any country except NEPAL & BHUTAN.
==> May we send above of the same goods [Import material against ADVANCE License & procured against notification.No.43/2001] for job work (A-DTA unit) to Job worker-B(EOU)? If  not why ? if  yes & how?
==> After final manufacturing said FINISHED GOODS may we export i.e.(A)  directly from job workers premises(“B”-EOU) to “C”? If not why? If yes & how?
==>In view of the above “A” can avail which types of benefits as per FTP/EXIM & Central Excise Rules?
==>All Industry Rate of Draw back can avail/claim or not suppose to @2%.

OPTION----2
Suppose: A----------------is a manufacturer(DTA unit)-----(SUPPLIER/EXPORTER))
B---------------- is a job worker(EOU unit)
C---------------is a foreign Customer
==>In view of the above, “A “wants to procure  raw materials/Consumables/Spares without payment of duty/with payment of duty in this way, it may be import against Advance License and may be indigenous procurement with payment of duty with availment of Cenvat credit U/R- 3 of Cenvat Credit Rule, 2004, for the purpose of manufacture or processing of export goods & their exportation out of India to any country except NEPAL & BHUTAN.
==> May we send above of the same goods[ Import material against ADVANCE License(Duty free) & procured with payment of duty]  for job work (A-DTA unit) to Job worker-B(EOU)? If  not why ? if  yes & how?
==> May we export i.e.(A)  directly from job workers premises(“B”-EOU) to “C”? If not why? If yes & how?
==> In view of the above “A” can avail which types of benefits as per FTP/EXIM &  Central Excise Rule, 2002?
==> All Industry Rate of Draw back can avail/claim or not suppose to @2%.
In this regards your expert opinion/details reply will be highly  appreciated & obliged.

Thanks and Regards,

SNEHAL SHAH

[kamal chordia]

Since if you are procuring / importing raw material under advance licence then there is no Duty Draw Back available and no central excise rebate refund available.

Further on export of this you can avail benefit of chapter -3 like FMS, FPS etc if the shipment made by you coveres in this scheme

 

 

[Medreich Limited]

In order to provide for utilization of idle capacity of EOU units, job work for DTA Exporter by these units have been permitted, but the facility would be limited to utilization of idle capacity of capital goods etc.  In Such a case DTA  units is not eigible for All Industry Rte of Drawback. The DTA Exporter is eligible for Payment of Brad Rate of Drawbak against duties susffered on inputs, on submission of proof of payment of duty. Further the goods has to be exported from the EOU Itself and cannot be allowed to be taken back o the TA Unt. Refer Circular No. 74/99- CUS dated 5.11.99, Circular No. 31/2000- CUS Dt. 20.4.2000.

 

AI Summary

Duty drawback eligibility limited where DTA inputs are sent to EOU for job work; Brand Rate only with proof of duty paid. Where a DTA manufacturer sends inputs to an EOU for job work, inputs imported/obtained under an Advance License preclude duty drawback or central excise rebate; if inputs were procured on payment of duty with Cenvat credit, Brand Rate drawback may be claimed on proof of duty paid. Exports must be effected from the EOU and the DTA exporter is not entitled to the All Industry Rate when EOU job work utilises idle capacity.