Customs Circular No. 4 dated 21^st January 2003

Attention is invited to the SS Nos.73.29 and 73.30 of the Drawback Schedule, 2002-2003, whereby duty drawback rates have been provided for non-alloy/ carbon steel forgings, etc. and alloy steel forgings, etc., respectively. However, the admissibility of drawback under these entries is further subject to the condition of �non-availment of Cenvat facility�.

2.     The Engineering Export Promotion Council has represented that duty drawback rates in respect of these products have been determined by taking into consideration only �Steel� as the input. Therefore, they should be permitted to avail of the Cenvat facility as regards the other inputs other than �Steel�, for example, consumables, furnace oil, high speed diesel oil, light diesel oil, superior kerosene oil, machinery spares, die blocks, etc.

3.     The issue has been examined. It is a fact that the duty drawback rates in respect of these products falling under SS No.73.29 and 73.30 of the Drawback Schedule have been formulated by taking into account the duty incidence only in respect of steel. The duty incidence on account of other inputs has not been considered while computing these rates. Therefore, if the exporters avail Cenvat facility in respect of inputs other than steel, no double benefit shall accrue.

4.     It is, therefore, clarified that in all those cases relating to SS Nos. 73.29 and 73.30 of the Drawback Schedule where the exporters have availed the Cenvat facility in respect of inputs other than steel, duty drawback should not be denied.

5.     All pending cases of the parties may be decided accordingly.

6.     Suitable public notices for information of the trade and standing orders for guidance of the staff may kindly be issued on the above lines.

7.     The receipt of this Circular may kindly be acknowledged.