Export of goods manufactured under area based exemption and exported to countries other than Nepal and Bhutan
Board's letter dated 8.12.06 clarified that in case of export of goods which are manufactured by availing the specified area based exemption notifications available in Jammu & Kashmir, North Eastern States, Sikkim & Kutch, the rebate of that portion of duty, which is refunded to the manufacturer in terms of these notification, is not admissible in terms of rule 18 of the Central Excise Rules, 2002.
The Central Government has amended Notification No. 19/2004-CE(NT), dated 6.9.2004 by Notification No. 37/2007-CE(NT) dated 17.9.2007 to provide that the excisable goods manufactured and cleared by availing the specified area based exemption notifications are not eligible for rebate of duty paid when exported. Consequently, such excisable goods that are cleared from the factory on or after 17.9.2007 will be permitted to be exported only under bond and not under claim of rebate under Notification No. 19/2004-CE(NT) dated 6.9.2004. However, such manufacturers can avail the rebate of duty paid on inputs used in the manufacture of goods exported in terms of notification no. 21/2004-CE(NT). dated 6.9.2004.
There is still a lot of doubt whether this is a double benefit or a single denial.
CBEC's F. No. 209/11/2005-CX-6 Dated : October 13, 2007