Industry & Economy
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Excise and Customs
Ministry orders recovery of DEPB benefits
K.R. Srivats
New Delhi
,
Feb. 9
THE Finance Ministry has directed its customs field formations to initiate recovery action in cases wherein duty entitlement passbook (DEPB) benefits were extended on supplies made by the domestic tariff area (DTA) units to the special economic zone (SEZ) units.
The revenue department has in a circular held that the benefit of DEPB scheme does not become legally available in respect of supplies made by DTA units to SEZ units until Chapter XA of the Customs Act is operationalised.
Special provisions relating to SEZs were inserted in the Customs Act through Finance Act, 2002, by creating a new Chapter XA. These provisions were to be brought into operation from a date to be notified. Till now, the said Chapter XA of the Customs Act pertaining to the SEZ scheme has not been brought into operation.
The Finance Ministry had, in fact, issued a notification on April 1, 2003, to amend its April 2002 notification and extend the provisions of the DEPB scheme to supplies made by DTA units to SEZ units.
A revenue department circular outlining the procedures to be adopted for the purpose of availing DEPB benefit in respect of such supplies were also issued on the same date.
With the revenue department realising that Chapter XA was yet to be operationalised, it has now clarified through a circular that "the benefit of DEPB scheme in respect of supplies made by DTA units to SEZ units can only be allowed on and from a future date when Chapter XA is brought into operation."
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