How to avoid Excise Duty while Export and Can we avail Excise Duty exemption or remission and Duty Draw Back together?

[Guest]

Since we are Yarn Producer and while Purchasing  PET Chips as Raw Material we pay Excise Duty @ 10% which we later on pass on local buyers while selling them Yarn hence recover duty.But here the question is we can pass on duty in case only selling Yarn to local Buyers but in case of Export we can not pass on excise duty to the importers or overseas Buyers hence here we are unable to recover our paid Excise duty which we have already paid to suppliers or from whom we are procuring raw material so in case of export we are unable to pass on duty to the overseas buyer and apart from that we can claim Duty Draw Back (Export Incentive) @ 5% only but still we are making loss by 5% ( Since we paid Excise Duty @ 10% and can avail Duty Draw Back @ 5% only on FOB Prices).

 

                     So Here are some points where I need your assistance to clear:-

 

1. In case of Exports, is there any way where we could avoid the Excise Duty?If Yes then what is the mechanism and procedure?

2. Can we avail  Excise Duty exemption and Duty Draw Back simultaneously?

3. What are the ways where we could avoid Excise Duty i.e Exemption and Remission?

 

Once you clear this, then Kindly Clear Duty Draw Back Scheme since There are two provision in the mentioned Scheme.

one is When CENVAT facility is not availed and second is When CENVAT Facility is availed.

 

We are unable to understand these conditions.

 

Thanks and Best Regards,

Devendra Kumar,

+91-9909854514 

AI Summary

Yarn Producer Seeks Excise Duty Relief: Exploring Cenvat Credit and Rule 19 for Export Benefits A yarn producer is seeking advice on managing excise duty for exports. They pay a 10% excise duty on PET chips used as raw materials but cannot pass this cost to overseas buyers, resulting in a loss since the duty drawback is only 5%. They inquire about avoiding excise duty on exports and whether excise duty exemption and duty drawback can be availed simultaneously. An expert suggests using Cenvat credit to offset excise duty and exporting under Rule 19 without duty payment. The expert also explains the different drawback rates depending on Cenvat credit usage and highlights considerations for choosing between Cenvat credit and duty drawback.