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Regarding Duty Drawback on embroidered silk garments
Circular No. 105 dated 20th
December 2000
A
representation has been received from the Indian Silk Export Promotion Council,
New Delhi, that their exports of beaded and embroidered silk garments are being
denied drawback under SS No.62.06 for the reason that the said entry does not
cover embroidered garments, and also under SS No.62.07 on the premise that the
garments entered for export are not manufactured by using imported beads and
sequins.
2. The issue has
been examined in the Board. It is clarified here that the drawback rate under SS
No.62.07 has been determined by taking into account the duty incidence in
respect of imported glass beads, sequins, lining and zippers. This rate does not
rebate duty incidence on account of silk as the data submitted by the Council
for the relevant entry "Natural silk high fashioned ready-made
garments..." indicated that the silk used was imported duty free under the
Advance Licence Scheme. On the other hand, the drawback rate under SS No.62.06
is intended to rebate duty suffered on the input, i.e., silk.
3. The Board is of
the view that the denial of drawback to embroidered silk garments would be
against the principle of equity as the exporters of embroidered silk garment
have at least suffered duties on the raw material `silk'. Therefore, in the
interest of the trade, it has been decided that the embroidered garments
(including those embroidered with metallised yarn) be given drawback under SS
No.62.06. However, for the purpose of granting drawback, the value of
embroidery/ beads/ sequins should be excluded from the total f.o.b. value. The
exporters should, therefore, be specifically advised to declare the value of
embroidery, beads and sequins separately on the shipping bills.
4. Suitable Public
Notice for information of the trade and standing orders for guidance of the
staff may kindly be issued on the above lines.
5.
Receipt of the Circular may please be acknowledged.
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