The Central Board of Indirect Taxes and Customs (CBIC), Department of Revenue, Ministry of Finance, has issued Circular No. 30/2026-Customs dated July 03, 2026, clarifying the manner of grant of drawback under Section 74 or refund under Section 27 of the Customs Act, 1962 in cases where import duty had been paid, either wholly or partly, through Duty Credit Scrips.
The clarification has been issued following representations received from trade and industry regarding difficulties in processing drawback and refund claims in cases where customs duty at the time of import was discharged through Duty Credit Scrips. The Board also noted that divergent practices were being followed by different field formations, with some authorities granting re-credit into scrips or issuing re-credit certificates, while others were sanctioning the amount in cash.
The issue was also highlighted in Para 5.3 of the Comptroller and Auditor General’s Report No. 33 of 2025 on the Duty Drawback Scheme, wherein it was observed that, in certain cases, drawback under Section 74 of the Customs Act, 1962 had been incorrectly granted in cash even though Basic Customs Duty had originally been discharged through Duty Credit Scrips.
After examination of the matter, CBIC has clarified that wherever duty has been paid through Duty Credit Scrips at the time of import and drawback under Section 74 or refund under Section 27 subsequently becomes admissible, such drawback or refund shall be granted through re-credit and not in cash.
In cases where import duty was paid through RoDTEP or RoSCTL scrips, the admissible drawback under Section 74 or refund under Section 27 shall be granted by way of re-credit into the electronic credit ledger of the Importer Exporter Code (IEC) holder. The amount so re-credited will be available for generation of electronic scrips and may be utilised by the concerned IEC holder in the manner prescribed under Notification No. 75/2021-Customs (N.T.) dated 23 September 2021.
CBIC has further stated that the Directorate General of Systems is in the process of developing the necessary module on the Customs Automated System (CAS) to operationalise the electronic re-credit mechanism. A detailed advisory will be issued by the Directorate General of Systems upon completion of the module.
For cases involving legacy schemes such as the Merchandise Exports from India Scheme (MEIS), Service Exports from India Scheme (SEIS), and similar schemes, where import duty was paid through legacy scrips and direct re-credit of such scrips is not feasible at the time of sanctioning drawback or refund, the Customs authority shall issue a Re-Credit Certificate for revalidation of Duty Credit Scrips by the Directorate General of Foreign Trade (DGFT).
Such Re-Credit Certificate is required to contain relevant particulars, including details of the scrip utilised, the date of import of goods subsequently re-exported, and the amount debited from the scrip at the time of import. This mechanism is intended to ensure that the benefit is restored through an appropriate re-credit route rather than through cash payment.
The Circular brings uniformity in the treatment of drawback and refund claims across Customs field formations and aligns the mode of granting relief with the original mode of duty payment. Accordingly, where customs duty was discharged through Duty Credit Scrips, the corresponding admissible drawback or refund will also be restored through re-credit, subject to the applicable mechanism for the concerned scrip scheme.
The Circular can be accessed at: https://taxinformation.cbic.gov.in/view-pdf/1003331/ENG/Circulars
