We import aluminum scrap and recycle it into ingots. We sell the recycled ingots locally in the domestic market after charging sales tax. Can we claim refund of special additional duty (SAD), which we pay on scrap while importing it?
Refund of the four per cent additional duty is available if you resell the imported goods on payment of value added tax or Central sales tax, and not if you use the imported goods in your process. So, in your case, you cannot claim refund.
We are a small trading firm having our own ECC number. Recently, we purchased an imported power supply unit from a local importer who has given us a cenvatable invoice claiming countervailing duty (CVD, equivalent to excise duty + education cess @10.3 per cent) and SAD @ four per cent. We have to supply this item to a manufacturing unit under a cenvatable invoice, charging CVD and SAD as paid by us to the first importer. Please let us know if our customer can take credit for SAD also.
If you are a dealer registered under the Central Excise law, then you can issue a cenvatable invoice and the manufacturer can take credit against your invoice. Kindly refer to Rule 9 of Cenvat Credit Rules, 2004. The manufacturer can take 50 per cent of the CVD paid and 100 per cent of the SAD paid in the first year and the remaining 50 per cent CVD in any subsequent year.
Is it necessary for gem and jewellery units in special economic zones (SEZs) to deposit an amount equivalent to customs duty at the time of procurement of precious metal from nominated agencies?
Rule 27(6) of SEZ Rules, 2006 says that where sourcing from nominated agencies is on a loan basis, the conditions mentioned in the Foreign Trade Policy (FTP) shall apply. Para 4A.4 of the FTP says that the procedure for import of precious metal by nominated agencies (other than those authorised by RBI and gems and jewellery units operating under the EOU and SEZ schemes) and the monitoring mechanism thereof shall be as per the provisions mentioned in the Handbook of Procedures, Vol. 1 (HB-1).
For obtaining the required quantity of precious metal on an outright sale basis (Para 4A.22 of HB-1) and on a loan basis (Para 4A.23 of HB-1), the exporter must furnish a bank guarantee or a legal undertaking for an amount prescribed by the nominated agencies. When nominated agencies book gold/silver/platinum in advance for supply to the exporter, a deposit for a minimum 20 per cent of the notional price has to be furnished to the nominated agencies (as per Para 4A.21of HB-1).
Can we submit the GR/SDF form after 21 days to the bank? Can we get a Bank Certificate of Realisation (BRC) against advance payments? Can we make any number of shipments below $25,000 without furnishing GR/SDF forms?
Banks can accept GR/SDF forms, if the delay in submission is explained to their satisfaction. You can get a BRC if export is carried out against advance payment received. You can make any number of shipments for $25,000 or less, without GR/SDF forms.