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

[Asked by 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

Cenvat credit: use duty-free export procedure to preserve input credit while comparing lower drawback rates for exporters.
Exporters can take Cenvat credit of excise duty paid on inputs and export under the ARE-1 duty-free procedure; Cenvat credit may be used for domestic duty payments or claimed as a cash refund if excess. The Duty Drawback scheme provides different rates depending on whether Cenvat credit was availed, so exporters must compare the lower drawback available when taking credit against the benefit of Cenvat credit or refund, considering value addition and administrative delays.