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CMA Final · Indirect Tax Laws and Practice · Duty Drawback

Under the Customs Act, 1962, when identifiable imported goods on which duty was paid are entered for export and cleared under the provisions on re-export, what portion of the duty paid on importation is repaid as drawback, provided the other conditions are met?

Ninety-eight per cent of the import duty paid is repaid as drawback under Section 74, when the goods are easily identified, shown to be the goods imported, and entered for export within two years of payment of duty. Other percentages are not provided in the section.

  1. ANinety-eight per cent of the duty paidCorrect
  2. BThe full one hundred per cent of the duty paid
  3. CSeventy-five per cent of the duty paid
  4. DNinety per cent of the duty paid

Explanation

Section 74(1) provides that ninety-eight per cent of the duty paid on importation is repaid as drawback, subject to identification of the goods and export within the time limit. The one hundred per cent option ignores the statutory percentage.

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