Subject : Finalisation of provisional assessment cases - clearance of imported goods under DEPB Scheme.

    Instances have been reported to the Board by field formations where the provisional duty determined on import of goods is beingn debited in DEPB scrips.  At the time of finalisation of assessment, the final duty payable may be more or less than the duty which was provisionally assessed.  In cases where the final duty is more than the provisional duty, the differential duty is paid by the importer either in cash or adjusted through additional debit in a DEPB scrip.  An issue has arisen for those situations where the final duty payable is less than the duty provisionally assessed, where a refund would be admissible to the importer.

2.  In case the duty is paid in cash, the principle is well settled, since the duty excess paid at the time of provisional assessment is liable for refund on finalisation of assessment.

3.  The issue has been examined in the Board.  In view of the fact that in case the final duty is more than the provisional duty, and the differential duty which is leviable must necessarily be debited in the DEPB scrip (or collected in cash), equity would demand that wherever the final duty assessed is less than the provisional duty, the excess credit must be recredited in the DEPB scrip.  Secondly, a DEPB scrip, can be debited only to the extent of duty leviable.  In case the refund is not re-credited in the DEPB scrip, the action would amount                of higher amount of duty that the amount of duty leviable under low and would be illegal.

4.  Therefore, in such cases, then eligible refund (excess debit) must be re-credited in the DEPB scrip by the Custom House.  Since this is only an adjustment in the original debit due to finalisation of assessment at a lower amount of duty than the provisional assessment, the re-credit shall be made by the Custom House itself.