REFUND OF CENTRAL EXCISE : Refund of central excise is an important fiscal incentive for export promotion. As you know, exports should not bear the burden of indirect taxes. Hence, exportable goods are either exempted from such taxes or these taxes are refunded, if exemption is not possible. In India, excisable goods are free from the incidence of excise duty levied by the central government, both on finished product and raw materials. The scheme is governed by the Section 37 of the Central Excise and Salt, act, 1944 as amended from time to time. It has been amended on September 22, 1995.. In lieu of the Rules 12, 12A and 191 A of the Central Excise Rules, only one Rule 12 operates for exports under claim for rebate of duty. The rebate is granted on the duty levied at finished product and on inputs for this finished product. Rule 13, 191-B, and 191-BR of Central Excise Rules have been integrated into Rule 13. This rule is applied for exports of goods in bond and utilisation of non-duty paid raw material for manufacture and export of excisable goods.

Manufacturers of export product are required to register their factories with the local Central Excise Authorities, by opening Personal Ledger Account (PLA). In PLA, the credit balance of the deposit account opened by individual manufacturers with the central excursive Authority is shown. At the time of removal of a consignment, the amount of duty actually levied on the consignment is shown as debit envy. After the proof of exportation the equivalent amount is again entered on the credit side. PLA is not needed in case of exploits under bond because the duty has not been actually paid.

Documents : The major excise documents are :

Invoices : Invoices are prepared in four copies. The original copy is for the buyer, duplicate for the transporter, triplicate for the Central Excise Officer and fourth copy for manufacturer's record.

AR41AR5 Forms : It is prepared in sixtuplicate. Both AR4 and AR5 forms can be used for export in Bond or under Rebate of Central Excise duty. Let us first learn how they are used.

AR4 form is to be used where either finished stage duty is not paid or its rebate is to be claimed later on. It can be elaborated as under:

i) Form AR4 is to be used in case of exports in Bond, of all goods without payment of duty on finished item (not on inputs).

ii) AR4 Form is also used where finished stage duty is paid and a rebate thereof is to be claimed after export.

Form AR5 is used where goods are manufactured/exported without the payment of duty on inputs (input stage duty). It can be elaborated as under:

i) AR5 form is used where no duty is paid on conduction inputs and the finished stage duty is also not paid on account of their export being made in bond.

ii) AR5 form is also used where inputs stage duty is not paid but duty on finished goods is paid and the rebate thereof is to be claimed after export.

Form C : It is an application for refund of excise duty. It contains details like AR4 Form No. and date of Shipping bill, name and address of the factory and its licence number, tariff classification of the goods exported and shipment details.