Time limits for exporters to claim duty reimbursement extended

The government today relaxed the rules for exporters by increasing the time limit for them to reclaim taxes on imported goods that are re-exported or used in the manufacture of exported goods.

"The rules have been amended to make the time limits... more exporter-friendly, to liberalise granting of extensions in case of delays," the Finance Ministry said in a statement.

The rules have been amended to delegate greater powers to decide on extensions in case of delays to field officers.

The Customs, Central Excise and Service Tax Drawback Rules, 1995, and the Re-Export of Imported Goods (Drawback of Customs Duties) Rules, 1995, have been amended, it said.

As per the existing rules, in case of drawback on re-export of imported goods, the time limit for filing a claim was fixed at three months.

But provisions were made for a maximum extension of the deadline by 3 months by an assistant or deputy commissioners of customs "in case he was satisfied that the exporter was prevented by sufficient cause from filing the case in time."

The amended rules now provide for a further extension of the deadline for filing drawback claims by another six months, over-and-above the original time limit of three months and the three-month extension. This extension can be availed after approval of the Commissioner of Customs.

This effectively means that exporters can now avail of a total extension of nine months for submission of drawback claims on re-export of imported goods.

The amended rules have also made it easier for brand owners to file drawback claims.

Under the earlier rules, the time limit for filing of drawback claims by brand owners was 60 days. This limit could be extended by another 30 days by the Commissioner of Customs if he was satisfied there was sufficient cause.

Now, under the new rules, the initial time period for filing a claim has been increased to three months. Furthermore, this time limit can be extended by three months by an assistant or deputy commissioner of customs and further by another six months by the Commissioner of Customs.

In the case of supplementary claims for drawback, the revised rules enable exporters to claim a 6-month extension over-and-above the initial deadline of 3 months and maximum permissible extension of 9 months for applying after publication of the All-Industry Rate of drawback.

This implies that the total extended period available to exporters is 15 months.

"We welcome this move as it is going to help the industry. But they have to make it clear to field authorities to pay the drawback within a specified period of time so that delays can be avoided," said Federation of Indian Export Organisations Secretary General Ajay Sahai.