Special Advance Authorization for Apparel - DGFT and CBEC Sync
BY Notification No. dated 11th August 2016, DGFT introduced a new scheme called Special Advance Authorisation Scheme for export of Articles of Apparel and Clothing Accessories of Chapter 61 & 62 of ITC(HS) Classification with effect from 1st September 2016 wherein exporters are entitled for an authorisation for fabrics including inter lining on pre-import basis, and All Industry Rate of Duty Drawback for non-fabric inputs on the exports.
In this Scheme, the exporters are also eligible for All Industry Rates of Duty Drawback as specifically determined by Central Government in which case, for the purpose of value addition norm of para 4.08 of FTP, the value of any other input used on which benefit of Drawback is claimed or intended to claimed has been specified in the DGFT notification as equal to 22% of the FOB value of export realized. However, option to claim drawback determined and fixed by Central Excise Authority (brand rate) under Rule 7 of the Drawback Rules 1995 remains in which case the value of inputs (other than the fabric imported duty free under the Special Advance Authorization) continues to be based on actuals.
To give effect to the Special Advance Authorisation Scheme, the Notification No. dated 13th August, 2016 has been issued providing exemption to fabrics (including interlining) from import duty.
And Notification No. dated 13th August, 2016 has been issued providing, subject to the specified conditions, the alternative All Industry Rates (AIRs) of drawback in the Drawback Schedule for the exports made against the Special Advance Authorisation in discharge of export obligations in terms of Notification No. 45/2016-Customs dated 13th August, 2016.
As mentioned above, the scheme comes into force from 1 st September 2016.
The CBEC's Systems Directorate is making all the necessary EDI related arrangements for implementation including specifying the appropriate new scheme code that would need to be declared by exporters making exports under the Special Advance Authorization Scheme cum AIR Drawback.
CBEC Circular No. 37/2016-Customs, Dated: August 13, 2016