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G. Srinivasan

NEW DELHI, Jan. 3

THE Revenue Department has allowed the duty entitlement pass-book (DEPB) benefits to embroidered silk products and made-ups and fabrics of the DEPB schedule prior to November 6, 2000.

Official sources told Business Line here that the Exim Policy 2000-01 allowed DEPB benefits to silk items with various descriptions as silk garments/ made-ups/ fabrics at varying rates.

The DEPB rate was allowed under one entry covering plain and embroidered/ embellished products. But on November 6 last, the Revenue Department issued a notification re-interpreting the same, limiting its scope to plain silk garments/ made-ups/ fabrics only and denying clearance to embroidered/ embellished garments/ made-ups and fabrics.

After two months of disruption, on New Year Day, a notification permitting embroidered/ embellished garments with the same entry with a value cap was issued. In March 2001, this notification was extended also to embroidered/ embellished made-ups and fabrics on the same basis.

Meanwhile, the Revenue Department has applied its notification of November 6, 2000 with retrospective effect and was denying the benefits already given in 1999-2000, at the rates then applicable, causing problems to exporters who were sure of obtaining the drawback for export.

The Textile Ministry took up the issue with the Revenue Department, contending that the exporters had contracted the export prices after giving allowance to the benefits available through DEPB scheme and as such "it is judiciously untenable to apply an interpretation with retrospective effect."

It is only after the matter has been discussed at the various inter-Ministerial meetings and the Official Group for Growth in Textiles (OGGT) that the Revenue Department issued a circular on December 20, 2001 allowing the benefits to embroidered silk products, made-ups and fabrics.

According to the Indian Silk Export Promotion Council Chairman, Mr Subhash Mittal, the Textile Minister, Mr Kashiram Rana, and his team of officials need to be lauded for taking up the legitimate cause of silk exporters. He said that silk exports fetched $340 million in 2000-01, though the target was $330 million.

Though the current fiscal target has been pegged at Rs 430 crore, Mr Mittal apprehends that the information available to him suggests that there has been a decline in silk exports of the order of 12 to 14 per cent during the first eight months of April to November 2001. The silk exports fetched $193 million during the first-half of the current fiscal, against $250 million in the comparable months of 2000.

Mr Mittal felt that the restoration of DEPB benefits to specific silk products, silk exports might partly make good the lost ground.

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