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Chapter - 8 Deemed Exports Policy and Criteria for claiming Deemed Exports Benefits.


Chapter - 8 :Deemed Exports


Policy 8.1 Policy relating to Deemed Exports is in Chapter-8 of FTP.
Criteria for claiming Deemed Exports Benefits 8.2.1 In respect of supplies under Paragraph 8.2(a) of FTP, procedure for issue of ARO and Back-to-Back Inland Letter of Credit is given in paragraphs 4.14 and 4.15 of HBPv1.
8.2.2 In respect of supplies under paragraph 8.2(b) of FTP and DFIA, deemed export benefits may be claimed from Development Commissioner or RA concerned. Advance Authorisation and DFIA shall be claimed from the concerned RA. Such supplies shall be certified by receiving agencies.
8.2.3 In respect of supply of capital goods under paragraph 8.2 (c) of FTP, supplier shall produce a certificate from EPCG Authorisation holder evidencing supplies / receipt of manufactured capital goods.
8.2.4 In respect of supplies under categories mentioned in paragraphs 8.2 (d), (e), (f), (g), (i) and (j) of FTP, application for advance authorisation shall be accompanied with a Project Authority Certificate in Appendix 27. Payment against such supplies shall be certified by Project Authority concerned as in Appendix 22 C.
Procedure for claiming Deemed Exports Drawback & Terminal Excise Duty Refund of Terminal Excise Duty 8.3.1 Procedure for claiming benefits under paragraph 8.3(b) and (c) of FTP shall be as under:-
  • An application in ANF 8 along with prescribed documents, Exemption from payment shall be made by supplier to RA concerned. Recipient may also claim benefits on production of a suitable disclaimer from supplier along with a self declaration in Appendix 22C of HBP v1 regarding non-a ailment of CENVAT credit in addition to prescribed documents.
  • In case of supplies under paragraph 8.2(a), (b) & (c) of FTP, claim shall be filed against receipt of payment through normal banking channel as in Appendix 22B. Claims should be filed within a period of twelve months from the date of payment. In cases where payment is received in advance, last date for submission of application may be correlated with date of supply instead of date of receipt of payment. Claim can be filed ‘Invalidation Letter/ARO wise’ against individual licences within the time limit as specified above. 100% TED refund may be allowed after 100% supplies have been made physically and payment received at least up to 90%. However, grant of deemed export duty draw back will be limited to the extent of payment received.
  • In respect of supplies under paragraph 8.2(b) of FTP where supplier wants to claim benefits from RA, RA shall allow deemed export benefits to DTA supplier, on receipt of certified copies of Central Excise attested invoice as proof of supplies made and / or Excise attested CT3 form and proof of validity of Lop.

    (1) For supply of High Speed Diesel / Furnace Oil from Depots of domestic oil Public Sector Undertakings under para 8.2(b) of FTP, Terminal Excise duty shall be refunded on the basis of duty paid certificate issued by concerned domestic oil Public Sector Undertaking in the format given in Annexure I to ANF 8. Duty refund will be allowed for quantity of HSD/Furnace oil procured by EOU/EHTP/STP/BTP, for its production activities, as certified by concerned DC/Bond authorities.(Ref. DGFT Public Notice No. 181/(RE 2008) 2004-09, Dated: 26th May 2009.)

    (2) Annexure I to ANF 8 shall be in the format annexed to this Public notice. 
  • In respect of supplies under categories mentioned in paragraphs 8.2(d), (e), (f), (g), (h), (i) & (j) of FTP, claim may be filed either on the basis of proof of supplies effected or payment received. Claims should be filed within a period of twelve months from date of receipt of supplies by project authority or from date of receipt of the payment as per the option of applicant either against a particular project or all the projects. Claims may also be filed where part payments have been received. 100% TED refund may be allowed after 100% supplies have been made physically and payment received at least up to 90%. However, grant of deemed export duty draw back will be limited to the extent of payment received.
8.3.2 For claiming exemption from payment of terminal excise duty, procedure prescribed by Central Excise authority shall be followed.
8.3.3 Where All Industry Rate of Drawback is not available or same is less than 4/5th of duties actually paid on materials or components used in production or manufacture of the said goods, an application in ANF 8 along with prescribed documents may be made to RA or DC, for fixation of brand rate. Recipient may claim benefits on production of a suitable disclaimer from supplier along with a self declaration in Appendix 22 C of HBP v 1 regarding non-a ailment of CENVAT credit in addition to prescribed documents.
8.3.4 Claim application shall be filed along with application for fixation of brand rate of duty drawback in case brand rate is required to be fixed. Provision of late cut under paragraph 9.3 and supplementary claim under paragraph 9.4 shall also be applicable under this sub-paragraph.
8.3.5 RA may consider provisional payment up to 75% of drawback claim in case of private companies and 90% in case of PSUs, pending fixation of Brand Rate.
8.3.6 Subject to procedure laid down in this Handbook, Customs and Central Excise Duty Drawback Rules, 1995 shall apply mutatis mutandis to deemed exports. Procedure for claiming 8.4 In respect of supplies made by sub-contractor to main contractor deemed export benefits under paragraph 8.2(d), (e), (f), (g), (i) and (j), main contractor by Sub-contractor may make payment to sub-contractor and issue payment certificate as in Appendix 22-C as Form 1-C. However, for supplies under paragraph 8.2(d), (e), (f), (g) and (j), payment certificate from main contractor shall not be insisted for refund of Terminal Excise duty. Deemed exports benefits to sub-contractor would be available to the extent of goods that are manufactured and supplied by him or outsourced from other manufacturers, for value as indicated in Appendix 22-C of HBP v1. Payment of interest on 8.5 In accordance with Para 8.5.1 of Foreign Trade Policy, simple delayed refund of Duty interest @ 6% per annum is payable in the case of delayed refund Drawback / TED on of Duty drawback and TED under deemed export if the claim deemed exports which has become due on or after 01.04.2007, is not settled within 30 days after its final approval by the Regional Authorities. This period of 30 days will be reckoned from the date of approval of the case by the Regional Authority and communicated to the firm through a standard letter. The application for claiming interest shall be filed in prescribed Aayaat Niryaat Form within a period of 90 days after receipt of cheque for the main claim. The Regional Authorities will issue a separate cheque for payment of interest and also maintain accounts separately.

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