Disbursement of exporters' dues made easier

EXIM MATTERS

The Central Board of Excise and Customs (CBEC) has issued a useful circular (No. 39/2007) directing that additional drawback due to the exporters may be credited to their accounts without the requirement of filing a supplementary drawback claim. Hopefully, enough funds will also be made available so that the Customs can disburse the drawback amounts to the exporters quickly.

In response to the representations of the exporters that the rupee appreciation against the US dollar was affecting them adversely, the commerce ministry had announced a package of relief measures in June. One of the measures was to increase the duty drawback rates.

The finance ministry accepted the recommendations of the commerce minister partially and increased the duty drawback rates for select products covered by specific sectors, where import content was quite low. The increases in the rates were made effective from the beginning of the current financial year.

The exporters, however, were finding it difficult to get the extra money from the Customs. One of the reasons was that they were asked to follow the procedure for filing supplementary claims as per Rule 15 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995.

Now, the CBEC has directed that the differential drawback amount which has become due to the exporters against exports effected through Electronic Data Interchange during this period may be paid to them without their having to file supplementary claims.

The Directorate General of Systems has been requested to provide suitable software to all Electronic Data Interchange locations which will ensure that the differential amount of drawback gets automatically processed and credited to the exporters' accounts without their having to file individual supplementary claims.

However, in case of manual shipping bills the exporters shall be required to file supplementary claims as required under Rule 15 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995. Exporters are unable to appreciate the reasons for this discrimination. Surely, the Customs at the non-Electronic Data Interchange stations can use calculators!

In another helpful Circular (No.37/2007), the CBEC has clarified that the main purpose of introducing the Export Valuation Rules is to provide for a sound legal basis for the valuation of export goods and that it is also expected to check deliberate overvaluation of export goods and misutilisation of value based export incentive schemes.

At the same time due care has to be taken to facilitate the movement of bona fide export goods which is vital for the country's economic growth, says the Circular.

The assessing officers shall, therefore, exercise due caution to avoid unnecessary queries regarding truth or accuracy of the declared export value.

The CBEC says that the Export Valuation Rules are not intended to bring about any significant change in the existing pattern of valuation of export goods. It is the responsibility of the supervisory officers to monitor regularly the export valuation practices, so as to ensure proper implementation of the said Valuation Rules without hindering the flow of bona fide export goods.

Another Circular (No.38/2007) explains the changes in the Import Valuation Rules essentially emphasising that pre-landing charges like ship demurrage, lighterage, barging etc. can be loaded for valuation purposes.

Sometimes, even expenses like royalty, license fees etc. relatable to post-importation activities like running the machines or plant can be loaded, says the Circular and gives some illustrations.

tncr@sify.com