A manufacturer has exported goods through merchant exporter. However, due to quality problems, goods are re-imported by the merchant exporter after paying of applicable customs duties for sending back to original manufacturer. Bill of entry is in the name of merchant exporter, who is not registered with CE dept for passing on cenvat credit.. Please advise with suitable circulars, case laws as to how credit of the customs duty paid can be taken by the manufcaturer in the above situation.
Regards.
Manufacturer Seeks Cenvat Credit on Re-imported Goods; Applicability of Rule 16 Discussed for Duty-Paid Returns A manufacturer exported goods through a merchant exporter, but due to quality issues, the goods were re-imported. The merchant exporter, who is not registered with the Central Excise department, paid the applicable customs duties. The manufacturer seeks advice on claiming Cenvat credit for these duties. Responses highlight the applicability of Rule 16, which allows duty-paid goods to be brought back for repairs, with Cenvat credit available based on duty documents. However, Rule 16 may not apply if goods were exported under a Letter of Undertaking (LUT) without duty payment. Credit for import duties may not be available if repairs do not constitute manufacturing. (AI Summary)
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