Members of the Council

Sub :  Drawback for Leather and Leather Products – exemption from filing supplementary claims – reg.

Dear Member,

We wish to invite your kind attention to the Council’s circular of even number dated July 16, 2007 informing about the revised rates of Drawback  (DBK) for leather and leather products falling under Chapter 41, 42, 42 and 64.

As per DBK Notification No. 68/2007 – Customs (NT) dated 16.7.2007 the revised DBK rates for most of the leather and leather products were applicable with effect from April 1, 2007. In this connection, the Department of Revenue, Ministry of Finance, Govt. of India issued a Customs Circular No.25/2007 dated 16.7.2007 wherein it was mentioned that Custom Houses may create separate cells to settle the supplementary claims of exporters on account of applicability of revised DBK rates from April 1, 2007 for certain products. 

However, member-exporters represented to the Council that filing such supplementary claims of drawback would create additional paperwork and result in more processing time as thousands of such supplementary claims would have to be settled. Considering this, the Council represented the matter to the Directorate of Drawback requesting that as the EDI has been implemented in major customs houses across the nation, the additional DBK remittances for the enhanced DBK rates from April 1, 2007 can be made directly to the exporters concerned on suo moto basis, instead of filing supplementary claims.

We are pleased to inform you that the Government of India has favourbaly considered the said representation and the Department of Revenue, Ministry of Finance has now issued a Customs Circular No.39/2007- Cus dated 9.10.2007 (copy enclosed)  as per which a one-time relaxation has been granted to exporters from filing supplementary Drawback claims against EDI shipping bills in respect of which Let Export Orders (LEOs) were given by Customs Authorities during the period 1.4.2007 to 17.7.2007. Accordingly, the differential Drawback amount payable for the said EDI bills will be credited to the exporters accounts without filing any supplementary claims. However, in case of manual shipping bills, the exporters shall be required to file supplementary claims as per rules.

Member-exporters may kindly note the above.

With regards

Dr. K. Elangovan