The Director General of Foreign Trade (DGFT) has issued a public notice (no.31 dated November 21, 2012) allowing recipient of goods also to claim refund of terminal excise duty (TED) against deemed exports supplies on production of a disclaimer from the supplier in a new format. This amendment has caused some confusion but it is only correction of an error that had crept in earlier.
The facility allowing the recipient of goods to claim refund of TED as well as duty drawback against deemed exports supplies was first introduced through Public Notice no. 19 dated October 26, 2004. This provision has continued since then and Para 8.3.1 of the Handbook of Procedures, Vol. 1 (HB-1) for the year 2010-11 had a provision allowing claim of terminal excise duty as well as duty drawback by the recipient of the goods.
Through Public Notice no. 35 dated March 1, 2011, the DGFT amended the declarations to be furnished for claiming TED and deemed export drawback refund. The third sentence of the then existing para in the declaration was broken into two separate sentences (one dealing with drawback benefit and the other dealing with TED refund). The heading of the self declaration was suitably amended to make it explicit that the declaration was for claiming the benefit of TED refund. However, in the body of the main amendment, the words ‘recipient may also claim benefits’ were replaced with the words ‘recipient may also claim drawback benefits.’ The change in the wordings seemed to restrict the recipients to claim of only the drawback benefit but taken as a whole, the amendment left no one in doubt that refund of TED could be claimed by the recipient of the goods. At the ground level also, TED refunds were being allowed to the recipients but apparently, the error has been brought to the notice of the DGFT and so, he has not only rectified the position making it explicit that the recipient can claim the TED refund but has also made the amendment effective with retrospective effect from March 1, 2011, the date when the mistake was made in the Public Notice no. 35 of that date. He has also prescribed a new format for claiming TED refund. The new format removes another defect in the sense that declaration regarding availing Cenvat Credit is not required now for claiming TED refund.
In August 2011, the Central Board of Excise and Customs (CBEC) had finalised the ‘Authorised Economic Operators’ (AEO) programme for implementation to secure supply chain of imported and export goods based on the SAFE Framework of Standards adopted by the World Customs Organisation.
Based on feedback received from the stakeholders, the CBEC revised the guidelines last week. The changes include stringent requirements in regard to business partner security, procedural security, inclusion of authorised couriers and custodians in the AEO Programme, automatic disqualification on non-furnishing of the information by the applicant, non-requirement of the compliance records of advocates directly employed by the applicant, outreach of AEO Programme by organising workshops, time limit of 90 days to be reckoned from the date of furnishing of complete information, use of any international seal compatible with standards of PAS/ISO 17712 for couriers and air consignments and so on. Hopefully, more exporters and importers will register as AEO and expedite their consignments.