Duty Drawback is the special rebate given under the Section 75 of Indian Customs Act on exported products or materials. Duty drawback rates or concession are only applicable on products which are used in the processing of goods manufactured in India and exported and imported to foreign countries.
All industry drawback rates are fixed by Directorate of Drawback, Dept. of Revenue, Ministry of Finance and Government of India and are periodically revised - normally on 1st June every year. Section 37 of Central Excise Act allows Central Government to frame rules for purpose of the Act. Under these powers, 'Customs and Central Excise Duties Drawback Rules, 1995' have been framed.
Duty drawback rates differ from item to item and are normally fix either as a percentage of the value of goods exported or as a specific value for every unit of the commodity being exported. However, drawback rates are usually fixed in terms of a value for every unit (quantity) of goods exported. Steel is a classic example.