Ct-1 bond execution in penultimate sales

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 October 2012 Please explain how to execute CT-1 Bond when the dealer is purchasing goods from a manufacturer and selling the same goods to a export house who will export the the same goods to different countries. Please explain the process of how to execute CT-1 bond.

In the above case, real exporter is giving us Form H and the dealer is also giving Form H to the manufacturer. Do the dealer needs to execute CT-1 bond in the similar fashion of Form H (as both exporter and dealer should execute CT-1 bond)or only one should execute CT-1 bond?

And another case. If the exporter gives CT-1 bond and ARE 1 on the name of manufacturer, is there any problem for exporter to avail duty drawback? Is it possible to do the transaction?

U S Sharma

U S Sharma (Expert)
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12 October 2012 exporter will execute CT-1 direct in favor of factory of manufacture, middleman dealer is not entitled to obtain CT-1 / form H for intermediate transactions

H form issed by middleman dealer is not legal and it would be subject to penalty and calcellation of such forms, as he is not exporter of such goods, as this form is to be used by exporter only, for procurement of goods for export purpose.

duty drawback is seperate issue, and can be availed if the factory of manufacture does not avail cenvat credit on inputs/capital goods, however dutydrawback is dependent upon norms on the specific item to be exported, for which he has to consult his CHA.

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