Tax Credit Certificate in relation to exports
34Tax Credit Certificate in relation to exports.
280ZC. (1) Subject to the provisions of this section, a person who exports any goods or merchandise out of India after the 28th day of February, 1965, and receives the sale proceeds thereof in India in accordance with the Foreign Exchange Regulation Act, 1947 (7 of 1947)35, and the rules made thereunder, shall be granted a tax credit certificate for an amount calculated at a rate not exceeding fifteen per cent on the amount of such sale proceeds.
36lExplanation ]:For the removal of doubt it is hereby declared that the expression "sale proceeds" in this sub-section does not include freight or insurance attributable to the transport of the goods or merchandise beyond the 37customs station as defined in the Customs Act, 1962 (52 of 1962).
Explanation 2 : For the purposes of this sub-section, a person who exports any goods or merchandise in respect of which the declaration in pursuance of rule 3 of the Foreign Exchange Regulation Rules, 1952, is required to be in Form E.P., or Form E.P.I. in the First Schedule to the said rules, shall not in respect of such goods or merchandise be deemed to have received the sale proceeds in India in accordance with the Foreign Exchange Regulation Act, 1947 (7 of 1947)35, and the rules made thereunder unless he receives the same in India through an authorised dealer as defined in the said Act.]
(2) The goods or merchandise in respect of which a tax credit certificate shall be granted under sub-section (1) (including the destination of their export) and the rate at which the amount of such certificate shall be calculated shall be such as may be specified in the scheme :
Provided that different rates may be specified in respect of different goods or merchandise.
(3) In specifying the goods or merchandise (including the destination of their export) and the rates, the Central Government shall have regard to the following factors, namely:—
(a) the cost of manufacture or production of such goods or merchandise and prices of similar goods in the foreign markets;
(b) the need to develop foreign markets for such goods or merchandise;
(c) the need to earn foreign exchange;
(d) any other relevant factor.
38[(4) The amount shown on a tax credit certificate granted to any person under this section shall, on the certificate being produced before the 38a[Assessing] Officer, be adjusted against any liability of that person under the Indian Income-tax Act, 1922 (11 of 1922), or this Act, existing on the date on which the certificate was produced before the 38a[Assessing] Officer and where the amount of such certificate -exceeds such liability, or where there is no such liability, the excess or the whole of such amount, as the case may be, shall, notwithstanding anything contained in Chapter XIX, be deemed, on the said date, to be refund due to such person under that Chapter and the provisions of this Act shall apply accordingly.]
34. For Tax Credit Certificate (Exports) Scheme, 1965, refer Taxmann's Direct Taxes Circulars, Vol. 1, 1985 edn., p. 1348.
35. Since repealed, now Foreign Exchange Regulation Act, 1973 (46 of 1973).
36. Inserted by the Finance (No. 2) Act, 1965, with retrospective effect from 1-4-1964.
37. For definition of "customs station", see footnote 83 on p. 281 ante.
38. Substituted by the Finance (No. 2) Act, 1965, w.e.f. 11-9-1965.
38a. Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.
[AS AMENDED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987]