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Brand Rate of Drawback Fixation

Brand Rate of Drawback Fixation , If the export product is not covered under the All Industry Rates the exporter / manufacturer can apply for fixation of brand rate of drawback under Rule 6 of the drawback rules and these rates are called Brand Rates of Drawback. There is also another provision under Rule 7 of the Drawback rules that if the exporter / manufacturer feels that the drawback rate allowed is inadequate then he can go for fixation of Special Brand Rate under Rule 7 of the Drawback rules and the primary condition for fixation of such rate is that the All Industry Rate is in fact less than 4/5th of such amount or rate determined under this rule.

As a matter of fact the drawback amount is supposed to be equivalent to the amount of Customs Duty in respect of imported raw material / inputs used in the export products and the Central Excise Duty suffered on the indigenous inputs provided MODVAT facility has not been availed for the indigenous inputs. For fixation of Brand Rate as well as Special Brand Rates applicant has to file for fixation of rates under Rule 6 / Rule 7 to the Jurisdictional Central Excise Commissionerate within 3 months from the Let export date. Further 3 Months can also be allowed by the Commissioner of Central Excise on request with reasonable grounds to be made by the Exporter / manufacturer.

Fixation of Brand rate is done by the Commissioner of Drawback after receipt of verified data of  the exporter / manufacturer. The verification of date is done by Jurisdictional Central Excise office in this regard and the verification of data is to be done within one month of the receipt of the brand rate application and this is under normal procedure of the drawback. However as a matter of liberalization the Govt. has also allowed the brand rate to be fixed under simplified procedure on provisional basis. Under simplified procedure the verification is to be conducted at a later stage this facility was admissible earlier to limited companies only but since 1996 onwards the same facility was extended to Partnership concerned. To avail this facility the applicant has to execute a bond on the prescribed format stating that the difference in the rate if any found on verification of data will be recoverable from the exporter / manufacturer immediately.

After fixation of rates the exporter / manufacturer has to apply for payment of drawback from the Commissioner of Customs of Port of Exports. The Exporter has to submit proof of exports and realisation of export proceeds and work sheet of drawback as per Brand Rate Letter.