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Regarding central excise procedures for exports - Relevance of EOB value
vis-�-vis value declared on AR4
Circular
No. 203
dated 26th April 1996
Certain
doubts have been raised in respect of "Value" of export goods for
Central Excise purposes, viz.-a) whether Free on Board (FOB) Value mentioned in
the shipping bill should necessarily be the same as the value mentioned on AR 4
and the invoice issued under Rule 52A
b)
It the FOB Value and the AR4 Value can be different, whether FOB Value or
the AR4 value has to be taken into consideration while ascertaining the value
for the purpose of export under Rule 13of for granting the rebate of duties
under Rule 12.The matter has been examined by the Board.
2.
Regarding point (a), it is observed that the AR4 value should be
determined u/s 4 of the Central Excise & Salt Act and the same should be
declared on the invoices issued under Rule 52A. FOB value, which is contra acted
price in the course of international trade, should normally correspond to
Section 14 of the Customs Act, 1962 and this value may be more or even less than
the AR4 value. Therefore, this is clarified that, it is not necessary that the
AR4 Value and the FOB Value should be the same.
3.
Regarding point (b), this is clarified that it is the assessable value
determined under Section 4 of the Central Excise & Salt Act, which is
required to be mentioned on AR4 and the corresponding invoice issued under Rule
52A. This 'Value' is relevant for the purposes of Rule 12 & Rule 13 of
Central Excise Rules, '1994'. "FOB Value" is relevant for Customs
purposes and other schemes like drawback, exports under DEEC etc. However, in
cases where it is found that on account of variance between FOB Value and the
AR4 value, the exporter is getting unusually high drawback and DEEC benefit, the
matter may be referred to the agencies such as Customs, Drawback Directorate,
DRI etc. for initiating necessary remedial measures to protect the revenue.
4.
Circular No. 10/68/CX.6 dated 10.4.86 stand superseded.
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