Export under DFIA – No Cenvat - JDFT clarifies
The Jt DGFT, Mumbai clarifies that as per 4.4.7 of the Foreign Trade Policy, “No CENVAT credit facility shall be available for inputs either imported or procured indigenously against the Authorization”.
The Customs Notification No. 40/2006 dated 1st May, 2006 provides that for exports made under DFIA, the CENVAT facility under CENVAT Credit Rules 2004 for the facility under Rule 18 or Rule 19(2) under Excise Rules 2002 cannot be availed in respect of the inputs used in the product exported under DFIA.
The Jt DGFT has noticed instances where exporters have availed these benefits in respect of exports made under DFIA.
So he instructs that to avoid inconvenience to the Trade while processing applications, the exporters applying for DFIA should furnish a declaration that
++ neither we nor our Supporting Manufacturer(s) has availed the CENVAT Credit Facility under CENVAT Credit Rules 2004 or facility under Rule 18 or Rule 19(2) of Central Excise Rules 2002 in respect of inputs used in the product exported under DFIA.
++ I/we shall be liable to penal action under Foreign Trade (Development & Regulation) Act, 1992 in case the declaration furnished above is found to be incorrect or false.
Trade Notice No. 2/AM07Dated: 2nd February, 2007 of JOINT DIRECTOR GENERAL OF FOREIGN TRADE, Mumbai