CBEC clarifies issues on Refund of Countervailing Duty as Duty Drawback [Read Circular]

The Central Board of Excise and Customs (CBEC) today clarified the issues on refund/claim of Countervailing Duty as Duty Drawback under the Customs Act.

The Board clarified that the Countervailing Duties leviable under section 9 of the Customs Tariff Act are rebatable as Drawback in terms of Section 75 of the Customs Act.

“Since Countervailing Duties are not taken into consideration while fixing All Industry Rates of Duty Drawback, the Drawback of such Countervailing Duties can be claimed under an application for Brand Rate under Rule 6 or Rule 7 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 and/or the Customs and Central Excise Duties Drawback Rules, 2017, as the case may be. This would necessarily mean that drawback shall be admissible only where the inputs that suffered Countervailing Duties were actually used in the goods exported as confirmed by the verification conducted for fixation of Brand Rate,” the circular issued by the Board today said.

It was further clarified that where imported goods subject to Countervailing Duties are exported out of the country as such, then the Drawback payable under Section 74 of the Customs Act, 1962 would also include the incidence of Countervailing Duties as part of total duties paid, subject to fulfillment of other conditions.