TaxTMI 
TaxTMI 
2005 (3) TMI 309
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.... follows : The appellants are the regular exporters of Heat Resistant Latex Rubber Thread through Cochin port. For the period from 7-5-2002 to 3-2-2003, they exported the goods under claim for Drawback. There were in all 22 shipping bills. The total amount claimed was Rs. 78,10,667/-. The drawback rates were as mentioned in the Drawback Schedule (Sl. Nos. 40.05 and 40.06). There was intelligence that the appellants were claiming Duty Drawback on the basis of wrong declaration inasmuch as the export product suffers only negligible duty incidence on the materials used and substantial portion of the materials is indigenously produced on which no duty is paid. 97% by weight of the export product is constituted by Natural Rubber. The appellan....
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....of Drawback on any product, the average duty incidence on the product is taken into account. They do not determine the rate only on the basis of a representation from a particular exporter. (ii) When the All Industry Rate is available, it is not necessary that the exporter should produce any evidence of duty incidence on his export product. (iii) Our attention was also invited to the Ministry's Circular No. 24/2001-Cus., dated 20-4-2001. The following paras from the Circular are extracted : "2. The issue has been examined in the Board. All Industry Rate is based on the concept of averages, wherein the drawback rate itself as well as its customs and excise portions are based on w....
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....of such goods had suffered higher or lower incidence of duty or for that matter it is immaterial even as to whether a particular input has suffered duty or not. (v) The following case laws were relied on : (a) 1997 (91) E.L.T. 474 (GOI). In Re : Tube Investments of India, the GOI held that the Customs officers are not authorised to make any reduction from the rate of amount of drawback fixed. (b) 1991 (54) E.L.T. 3 (S.C.) - Chemicals & Fibres of India Ltd. v. UOI. Para 8 of the order discusses about the fixation of Drawback Rate based on the industry averages. (c) 1991 (56) E.L.T. 280 (GOI) : In Re : Orissa Oil Indus....
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....nbsp; Para 6 of the Ministry's Circular dated 20-4-2001 states that if the Department has any documentary evidence of fraud, the Customs House may initiate proper investigation with the prior written approval of the Commissioner. In this case, the appellant had mis-represented to the Government regarding use of imported rubber. Hence denial of Drawback is in order. (iii) The Kerala High Court, in the case of Premier Tyres Ltd. v. Assistant Collector & Others - 1980 (6) E.L.T. 161 (Ker.), has held that if the exported goods had been manufactured out of articles on which no duty has been paid, no drawback was admissible thereon under the provisions of Section 75 of the Customs Act, 1962 read with Customs & Central Excise ....
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....in products, which are manufactured by several manufacturers, one can always arrive at the average consumption of raw materials and the incidence of duty based on industry average and fix the All Industry Rate. In the present case, no doubt, the All Industry Rate has been fixed. It should be borne in mind that the All Industry Rate has been fixed based on the incidence of import duty on rubber. When rubber that constitute 97% of the export product, is not at all excisable, then there is no question of any duty incidence on the export product excepting the duty incidence on the remaining 3% of the product, which is insignificant as per the Commissioner's findings. The learned Advocate, after going through the second proviso to Rule 3, urged ....