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Custom definitionADJUDICATING means any AUTHORITY authority competent to pass any order or decision under this Act, but does not include the Board, Commissioner (Appeals) or Appellate Tribunal. ―ASSESSMENT‖ includes --- provisional assessment, self-assessment, re-assessment and CUSTOMS AREA

means the area of a customs station and includes any area in which imported goods or export goods are ordinarily kept before clearance by customs authorities.

CUSTOMS STATION CUSTOMS PORT

means a customs port, inland container depot, customs airport or a land customs station.

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Custom airport Sec 2(10) Goods

means any port appointed under section 7 to be a customs port and includes a place appointed to be an inland container depot. As per clause (a) and (aa) of section 7(1) of the Customs Act, the Board may, by notification in the Official Gazette, appoint the ports and airports and the places which alone shall be customs ports or customs airports and the inland container depots for the unloading of imported goods and the loading of export goods or any class of such goods. (i) Section 7 of the Customs Act, 1962 empowers the Central Board of Excise and Customs to appoint inland container depots or air freight station And appoint land customs stations. (ii) Section 8 of the Customs Act, 1962 empowers the Commissioner of Customs to specify limits of customs area. means any airport appointed under clause (a) of section 7 to be a customs airport [and includes a place appointed under clause (aa) of that section to be an air freight station]; Goods includes – (a) vessels, aircrafts and vehicles; (b) stores; (c) baggage; (d) currency and negotiable instruments and (e) any other kind of movable property. means any goods brought into India from a place outside India but does not include goods which have been cleared for home consumption. Entry in relation to goods means an entry made in a bill of entry, shipping bill or bill of export and includes in the case of goods imported or to be exported by post, the entry referred to in section 82. means the waters extending into the sea upto the limit of contiguous* zone of India under section 5 of the Territorial Waters, Continental Shelf*, Exclusive Economic Zone and other Maritime Zones Act and includes any bay, gulf, harbour, creek* or tidal river.

IMPORTED GOODS ENTRY INDIAN CUSTOMS WATERS SIGNIFICANCE OF INDIAN CUSTOMS WATERS

(i) If an officer of Customs has reason to believe that any person in India or within the Indian customs waters has committed an offence punishable under section 132/133/135/135A/136, he may arrest such person informing him of the grounds for such arrest [Section 104 of the Customs Act, 1962]. (ii) Where the proper officer has reason to believe that any vessel in India or within the Indian customs waters has been, is being, or is about to be, used in the smuggling of any goods or in the carriage of any smuggled goods, he may stop any such vehicle, animal or vessel or, in

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case of an aircraft, compel it to land [Section 106 of the Customs Act, 1962]. (iii) Any vessel which is or has been within the Indian customs waters is constructed, adapted, altered or fitted in any manner for the purpose of concealing goods shall be liable to confiscation [Section 115(1)(a) of the Customs Act, 1962].

STORES conveyance dutiable goods India

RULES AND REGULATION

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IMPORT REPORT

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BILL OF EXPORT

means a Shipping bill referred to in section 50. Section 50 provides that the exporter of any goods shall make entry thereof by presenting to the proper officer in the case of goods to be exported by vessel or air, a Shipping bill in the prescribed form. bill of export means a bill of export referred to in section 50. Section 50 provides that the exporter of any goods shall make entry thereof by presenting to the proper officer in the case of goods to be exported by land, a bill of export in the prescribed form. import report means the report required to be delivered under section 30. Section 30 provides that the person-in-charge of a vehicle carrying imported goods or any other person as may be notified by the Central Government shall, in the case of a vehicle, deliver to the proper officer an import report within 12 hours after its arrival in the customs station, in the prescribed form. Stores means goods for use in a vessel or aircraft and includes fuel and spare parts and other articles of equipment, whether or not for immediate fitting. The definition does not cover goods for use in a vehicle. conveyance is defined to include vessel, an aircraft and a vehicle. The Act uses the term ―conveyance‖ with an inclusive definition covering all the 3 modes of transport -vessel (by sea), aircraft (by air) and vehicle (by land). dutiable goods is defined to mean any goods which are chargeable to duty and on which duty has not been paid. India includes the territorial waters of India. Territorial waters of India extend to 12 nautical miles into sea from the appropriate base line. Goods are deemed to have been imported if the vessel enters the imaginary line on the sea at the 12th nautical mile i.e., if the vessel enters the territorial waters of India. India includes not only the surface of sea in the territorial waters but also the air space above and the ground at the bottom of the sea. (i) Authority to make rules is with central Govt. while authority to make regulations is with CBEC. (ii) Rules have to be placed before parliament, while regulations framed by CBEC are not required to be placed before parliament. (iii) Sec 156 of CA 1962 empowers the central Government to make rules consistent with this Act generally to carry out the purposes of the Act. Sec 157 of CA 1962 empowers CBEC to make regulations, consistent with this Act and rules generally to carry out the purposes of this Act. However it may be noted that both rules and regulations have statutory force. Both are subordinate legislations and are legally valid and enforceable. Both rule and regulations are made to carry out the purposes of Act

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Shipping bill

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PROHIBITED GOODS

(iv) Customs officer has the power to search any person who has landed from/about to board/is on board any vessel within Indian customs waters and who has secreted about his person, any goods liable to confiscation or any documents relating thereto [Section 100 of the Customs Act, 1962]. (v) Any goods which are brought within the Indian customs waters for the purpose of being imported from a place outside India, contrary to any prohibition imposed by or under this Act or any other law for the time being in force, shall be liable to confiscation [Section 111(d) of the Customs Act, 1962]. means any goods the import or export of which is subject to any prohibition under this act or any other law for the time being in force but does not include any such goods in respect of which the conditions subject to which the goods are permitted to be imported or exported have been complied with.


SMUGGLING, DISTINCTION BETWEEN THE FUNCTIONING OF INLAND CONTAINER DEPOTS (ICD) AND CONTAINER FREIGHT STATIONS (CFS).

(a) in relation to a vessel, the master of the vessel. (b) in relation to an aircraft, the commander or the pilot in charge of the aircraft. (c) in relation to a railway train, the conductor, guard or other person having the chief direction of the train. (d) in relation to any other conveyance, the driver or other person in charge of the conveyance. in relation to any goods, means any act or omission which will render such goods liable to confiscation under section 111 or section 113. The differences between the functioning of Inland Container Depot (ICD) and Container Freight Station (CFS) are: (i) Meaning:-An ICD is a place where containers are aggregated for onward movement to or from the ports whereas CFS is a place where containers are stuffed, unstuffed and aggregation/segregation of cargo takes place. (ii) Location:-ICDs are normally located outside the port towns whereas no site restrictions apply to CFS. (iii) Attachment/Extension:-An ICD may have a CFS attached to it and CFS is treated as an extension of a port/ICD/air cargo complex.

Custom – procedure part Sec 29 obligation cast on person-in-charge on arrival of vessels or aircrafts in India Sec 2(31) Person-in-chargeSec 30- Import General Manifest / Import Report

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PERSON-INCHARGE

Sec 32

Imported goods not to be unloaded unless mentioned in import Mainfest

Sec 33 Sec 34

Unloading & Loading at Approved Places only Goods not to Unloaded or Loaded except under supervision of Custom Officer.

Sec 35 Restricition on goods being water borne- or boat noteSec 36- unloading on Holiday

In case the vessel arriving at the port does not get a berth, then, the import cargo is taken from the ship to the shore and the export cargo is taken from the shore to the ship in boats. imported goods to be water borne shall be accompanied with Boat note. In case of export if there is shipping bill no requirement to take boat note. Unloading of Goods except Sunday & holiday. If unloading on Sunday or holiday then merchant overtime fees will be paid.

Sec 45 Restriction on custody & removal of Imported Goods-

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Sec 31

(1) PIC of vessel or aircraft shall Call or Land at Custom at Port/ Airport only. (2) But in case of unavoidable cause, accident , stress of weather etc. can be called at any other place & (3) immediately report the arrival to nearest custom officer or police station & (4) shall not unload goods or allow passenger to depart except where departure or removal is necessary for reason of health, safety of life or property. for vessel-master, for aircraft- pilot-in charge, for railway train- conductor/guard, any other conveyance- driver Delivery of Import Manifest- before arrival of vessel or aircraft, but in case of vehicle- import report within 12 hrs after arrival, if not delivered then penalty upto 50000. It is in 4 parts- general declaration , cargo declaration, vessel stores list, private property list. It contains-(i) cargo to be landed (ii) unaccompanied baggage, (iii) goods in transit (iv) goods in transshipment Imported goods not to be unloaded until entry Inwards granted

(1) after unloading goods remain in custody of custodian. (2) he shall keep record of such goods (3) If imported goods pilfered after unloading then custodian liable to pay duty on such goods at rate of duty prevailing on date of import manifest/import report.


E- PAYMENT OF IMPORT DUTY Sec 48 - Procedure for Goods not cleared within 30 days after Unloading Sec 49 Storage of Goods in warehouse pending Clearance

Warehousing without warehousing – if goods not cleared within reasonable time, then goods stored in public/ private WH without following provisions of warehousing Stores may be allowed to be warehoused without assessment of duty if stores to be supplied to Foreign going vessel or aircraft. (1) - SHIPPING BILL to be filed electronically (2) but in exceptional circumstances commissioner may allow to filed manually exporter shall file shipping Bill in case of vessel or Aircraft and Bill of export in case of vehicle. (1) If export duty paid then order permitting clearance and loading of goods for exportation passed. (2) Duly passed shipping bill handed over to person-in charge (3) Person – in charge will file EGM and then Entry outward granted (4) Thereafter loading of goods will start. And no conveyance leave without departure permission.

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Sec 50- Entry of Goods on Exportation Sec 51 & 39 to 42

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Sec 47 Clearance for Home Consumption-

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Sec 46 ENTRY OF GOODS ON IMPORTATION-

Clearance for home consumption MEANS that the customs duty on the imported goods has been Paid and goods are cleared for utilization. Clearance for warehousing- (1) means that the goods deposited in a warehouse and cleared for home consumption. (2) Duty is deferred till the time such goods are cleared for home consumption. (3) Importer has to execute a bond up to a sum equal to twice the amount of duty assessed on the goods at the time of import. (1) BOE to be filed electronically (2) but in exceptional circumstances commissioner may allow to filed manually (3) Importer shall file BOE for HC/WH. (4) Prior Entry Bill of EntryAdvance Bill of entry can be filed if vessel/ aircraft expected to arrive within 30 days. (5) Conversion of BoE from HC to WH or vice versa permitted if department revenue not prejudicially affected.(6) 3 types of BOE- BOE for HC( WHITE), BOE FOR WH (YELLOW), BOE FOR EX-BOND CLEARNCE FOR HC (GREEN) (1) IF importer paid duty within 5 working days from date of return of BOE, (2) then order for clearance for HC/ out of charge order passed. (3) Otherwise interest charged. Note- if WH goods cleared and duty not paid within 5 days. No interest u/s 47 charged because in case of WH goods interest will be charged as per sec 61. ACCREDITED IMPORTERS- E-PAYMENT MANDATORY OTHER IMPORTERS- IMPORT DUTY MORE THAN 1 LAKH- E-PAYMENT MANDATORY (1) IF Imported goods are not cleared for – home consumption/ warehoused or transhipped, (2) then goods may be sold. (3) But animal, perishable and hazardous goods may be sold before 30 days.

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Clearance for home consumption AND Clearance for warehousing

Sec 53 Transit of Goods Sec 54 Transhipment of goods

Sec 55 Entry etc of goods on arrival at port Sec56

TRANSIT AND TRANSSHIPMENT - if goods mentioned in IGM, then goods may be transited on same conveyance to any place outside India or within India WITHOUT payment of duty. Transhipment of Goods without payment of Duty (1) if goods mentioned in IGM & Bill of transhipment presented, (2) then goods may be transhipped to any place outside India or within India WITHOUT payment of duty. (3) where any goods imported into a customs station are mentioned in the IGM/IR for transhipment to any major port or to customs airport or customs port (as notified by the Board) or to any other customs station and the proper officer is satisfied about the bona-fide intention for transhipment of the goods to such customs station, the proper officer may allow the goods to be transhipped, without payment of duty. - transit or transhipment within India will be treated as goods were imported for first time. Transport of certain classes of goods sub to certain conditions


BASIC CONCEPTS Duties of custom levied on goods imported or exported. Charging section- BCD on goods imported or exported at rates in CTA 1975, Govt also liable to pay custom duty Goods Goods includes – (a) vessels, aircrafts and vehicles; (b) stores; (c) baggage; (d) currency and negotiable instruments and (e) any other kind of movable property. IMPORT means bringing into India from a place outside India. NOTE- Import of goods into India commences when the goods enter the territorial waters of India, but gets completed only when the goods become part of the mass of goods within the country. Sec 13 (1) No duty on pilferage (if imported godds are pilfered after unloading BUT before order for clearance for HC PILFERED or WH). (2) Importer is not liable to pay duty but custodian is liable to pay duty on pilferage. GOODS Note- if pilfered goods are restored to importer , then importer has to pay duty. Sialkot industrial corporation- duty refunded, if pilferage taken place before order of clearance. Sec 23 (1) (1) Lost or destroyed other than pilferage before clearance for Home consumption- (2) Duty Remission of duty Remisssion BY AC/DC if importer is able to prove the loss or destruction. (3) Duty remission is on imported discretionary power of AC/DC. (4) Duty can be remitted for warehouse goods also. goods lost Sec 23 (2) Relinquishment of Title before order for HC or WH- No duty Relinquishment of Proviso to sec 68- Relinquishment of title before order for HC for warehoused goods – No duty Title Note- Relinquishment not allowed in case of offence for WH goods or Cleared for HC from Port.

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Item No 83 Sec 12

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Whether remission of duty is permissible under section 23 of the Customs Act, 1962 when the remission application is filed after the expiry of the warehousing period (including extended warehousing period)? or WHERE GOODS WERE NOT CLEARED WITHIN THE WAREHOUSING PERIOD OR THE EXTENDED PERIOD GIVEN BY THE AUTHORITIES AND THE GOODS HAD LOST THEIR SHELF LIFE, COULD THE ASSESSEE CLAIM REMISSION OF DUTY UNDER SECTION 23 OF THE CUSTOMS ACT?-- CCE v. Decorative Laminates (I) Pvt. Ltd. 2010 (257) E.L.T. 61 (Kar.)- ANS- NO Ans- the goods continued to be in the warehouse, even after the expiry of the warehousing period, it would be a case of goods improperly removed from the warehouse as per section 72(1)(b) read with section 71. The High Court, held that sec not applicable since the destruction of the goods or loss of the goods had not occurred before the clearance for home consumption within the meaning of that section. Application for Remission of duty not allowed as u/s 23 as the goods have neither been: [i] lost nor [ii] destroyed nor[iii] title to the goods has been relinquished at any time before clearance for home consumption. There will be no remission of duty if the goods had become unfit for use on account of non-availability of orders for clearance within the period or extended period as given by the authorities, their continuance in the warehouse will not attract section 23 of the Act. Sec 19- Articles liable to (1) – liable to duty on basis of Qty- that duty diiferent ROD/ Set of Article (2) Liable to duty on basis of value- if same rate- that rate, different rate- highest rate, (3) Not liable to duty- liable on basis of value, (4) Accessories and spare parts liable to same rate as that of article, if 2 conditions satisfied (i)accessory & parts etc. compulsory supplied (ii) no separate charge is made for such accessory etc. Project import (1) Project Imports are the imports of machinery, instruments, and apparatus etc., falling under different classifications, required for initial set up of a unit or for substantial expansion of an existing unit (2) Different articles for eligible project chargeable to different ROD WILL be liable to uniform rate of duty (3) (Eligible projects- industrial/irrigation/power/mining/ oil or mineral exploration/ other specified projects) Uniform heading- 98. 01, Uniform Rate of duty Sec 20- re-importRe-import of goods exported liable to import duty at time of re-import Goods manufactured or Exemptions (1) re-import for repairs within 3 years for other country & 10 year for nepal & re-


produced in India, which were earlier exported and thereafter imported into India treated at par with other goods imported into India. Is there any exemption. Sec 26- Refund of export duty, Sec 26A- Refund of Import duty –

exported within 6 months (2) re-import within 3 years by same person- pay duty = DDB + excise duty exempted earlier

Refund of export duty, (1) if sale return within 1 year, (2) application for refund within 6 months from date of order of clearance for HC Refund of Import duty –(1) Defective goods or not as per pur order (2) AC/DC satisfy as to identity of goods (3) goods re-exported/ Relinquishment of title/ goods destroyed within 30 days of order for clearance for HC ( extension upto 3 month by Commissioner of custom) (4) application with in 6 months from relevant date (5) relevant date- date of export or date of relinquishment or date of destruction (1) Import duty levied on derelict, jetsam, flotsam, wreck as if imported into India, unless exempted. (2) Jetsam and Flotsam are both jettisoned (i.e. thrown with speed) from the vessel to prevent it from sinking. They are not abandoned goods. Jetsam gets sunk and drifts to the shore whereas Flotsam does not sink but it floats and drifts to the shore. (1) Damaged deteriorated- Any Goods- (i) before or during unloading, (ii) after unloading but before examination, FOR WH GOODS- before Cleared for HC(2) Duty on damaged goods = value after damage/ value before damage *duty before damage (3) Value of damaged goods- determined by PO or Gross sale proceed if sold by auction/tender/any other way etc (1) Duty chargeable as if Denatured/ mutilated goods imported – (2) Denaturing or mutilation at request of owner to make goods unfit for one or more purpose

Sec 21 Duty on jetsam and flotsam and wreck

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Sec 22 Abatement of duty on damaged or deteriorated goods

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Sec 24- power to make rules for Denaturing and Mutilation

3 (5)- additional duty u/s 3(5) of CTA 1975 Sec 5 Sec 6 Protective dutySec 8/8A Sec 8B- Safeguard duty on goods imported in increased quantity

BCD- Preferential / Standard rate specified in CTA (1) CVD equal to duties of exise on like article if manufactured in India, (2) if no like article manufactured – rate of class of article & if liable at different rate then highest rate (3) CVD equal to duty leviable on raw material used in like article manufactured in India AV for calculating CVD(i) if Tariff Value Fixed- Av= Tariff Value, (ii) if MRP notified- [MRP—abatement], Goods notified under Medicinal and Toilet Preparations (Excise Duties) Act, 1955- Assessable value for CVD = MRP less abatement (iii) other goods [AV u/s 14 + BCD], Special CVD equal to VAT leviable on like article when sold in India

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Sec 2 Sec 3- addition duty of custom under sec 3 of CTA 1975

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Custom Tariff Act 1975

Lower custom duty under trade agreement, importer to produce evidence that goods manufactured are produce of specified country. to protect domestic industry on recommendation of tariff commission, duty not exceed amount proposed in recommendation Sec 7- CG specify period, extend/ reduce the period or rate Emergency power to impose or increase export/ import duties – No limit (1) Safeguard duty on goods imported in increased quantity causing injury or threatening to cause serious injury to domestic industry, (2) provisional duty – not more than 200 days, (3) at one time for 4 years, can be extended upto 10 years. (4) no duty on goods imported by 100% EOU or SEZ (5) provisions relating to demand, interest, refund, offence and


Sec 8C- Safeguard duty on goods imported from China

Sec 9 Countervailing duty on subsidised article

Sec 9 AA- Refund of Excess Anti- dumping duty paid

Customsec 14 of CA 1962 Av= Trans value

Cir 933/23/2010 Circular No.11/2010

Rule 1

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Sec 9B Sec 9C

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Sec 9A ways that would constitute circumvention of antidumping duty and how imposed under Section 9A(1A) of the Customs Tariff Act, 1975.

penalties of CA 1962 apply (6) No duty if import from one developing country- ≤ 3 % or more than 1 developing country each with less than 3% taken together ≤ 9% (1) Safeguard duty on goods imported from China in increased quantity causing market disruption, (2) provisional duty – not more than 200 days, (3) at one time for 4 years, can be extended upto 10 years. NOTE- Extension upto 10 years can be made even if the domestic industry has taken steps to adjust market disruption or threat (4) no duty on goods imported by 100% EOU or SEZ (5) provisions relating to demand, interest, refund, offence and penalties of CA 1962 apply (1) CVD on subsidised article, not exceeding amount of subsidy (2) When subsidy deemed to exist (i) if govt transfer funds i.e govt grant (ii) govt revenue not collected (iii) govt provides goods or service (iv) govt make payment to funding mechanism who does the above work (3) Provisional duty- retrospective imposition for 90 days (4) at one time for 5 years, can be extended upto 10 years. (5) provisions relating to demand, interest, refund, offence and penalties of CA 1962 apply (1) Anti- dumping duty not exceeding margin of dumping, (2) Margin Of Dumping = Normal Price – export price, (3) supplier sells goods to India at a price less than it normal price prevailing in his country. (4) Provisional duty- retrospective imposition for 90 days (5) at one time for 5 years, can be extended upto 10 years. (6) no duty on goods imported by 100% EOU, note- ADD levied on goods sold by 100% EOU to DTA (7) provisions relating to demand, interest, refund, offence and penalties of CA 1962 apply (8) Anti dumping duty levied if goods imported in unassembled form or by changing the nomenclature, or by routing the goods through third countries where cosmetic processes are carried out (1) if paid antidumping duty in excess of actual margin of dumping then importer shall be entitled to refund of such excess amount and (2) reduce such ADD as in excess of actual margin of dumping. Anti- dumping duty and CVD on subsidised article not levied for same situation Appeal against order of duty of subsidised or antidumping lie to CESTAT within 90 days with fee of 15000. VALUATION

Goods sold TV be for delivery at IMPORT-Time Of Import EXPORT- Time Of Export TV be for delivery at POI/POE [ place of import/ place of export ] Buyer & seller –not related Price is the sole consideration Cond specified in rules- 3(2) goods cleared from an 100% Export Oriented Undertaking to a depot which are subsequently sold in DTA will be valued as per Rule 3 to 9 of imported goods valuation Rules 2007 Sec 14 of CA 1962- value of the imported goods shall be the transaction value of goods. the price at which the imported goods are sold after warehousing them in India does not qualify to be the transaction value as per section 14. Custom Valuation (DPIG) Rules 2007 Short title, commencement and application


Rule 7 Rule 8 Rule 9

Rule 10 (1) Rule 10(2)

Rule 11 Rule 12 Rule 13

Rule 1 Rule 2 Rule 3 Rule 4

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Rule 5 Rule 6

AV = Deductive Value [price in India less (profit, COT, COI, duties and taxes, processing if any) Deductive value within 90 days can be taken AV = Computed Value- Addition Method [Cost of Material + processing charges + profit + general exp + expense in rule 10(2)] Residual Method- AV= Best judged Value However following valued can’t be taken-(i) Minimum custom value, (ii) highest of 2 alternative,(iii) fictitious or arbitrary value, (iv) S.P in India, (v) S.P in Domestic market of country of export, (vi) Price of goods to country other than India, (vii) cop other than in rule 8 Cost and services- commsion other than buying commission, cost of material, container, packing, design work if carried outside India, royalty any other payment. Note- post importation charges not includible. Additions of freight, insurance and landing charges (1) COT- Not ascertainable- 20 % of FOB. Ascertainable- other than air- actual, By air- [actual or 20% of FoB]less, (2) COI- Not ascertainable- 1.125 % of FOB. Ascertainable- ACTUAL, (3)Landing charges – 1% of C.I.F – WHEther ascertainable or not. Note- barging/ lighterage charges- include, ship demurrage- include Declaration by the importer Rejection of declared value, if reason to doubt truth & accuracy Conditions to reject value -Significantly higher value, abnormal discount, special discount to exclusive agent, misdeclaration/ non- declaration of parameters, fraudulent documents. Interpretative notes

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Rule 2(1)(d) Identical goodsRule 4- Av of identical goods Rule 2(1)(e) Rule 2(1)(f)

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Rule 2(2) Related Person

Definitions - AV= TV of imported goods + Adjustment in rule 10 Conditions- (1) no restriction on disposition or use other than restriction which are imposed by law, limit geographical area, don’t substantially affect value of goods (2) sale price not subject to condition (3) no part of proceed of subsequent resale accrue directly or indirectly to seller (4) buyer and seller not related. - officer or director of one another business, legally recognised partner, employer and employee, one of them directly control other, both of them directly or indirectly controlled by 3rd person, together they directly or indirectly control a 3rd person., member of same family, hold 5% or more voting power. Note – sole agent shall be related if fall within above criteria relation. (1) P,Q,R SAME (physical characterstics, quality and reputation) , (2) identical produced in the country where imported goods produced & (3) produced by same person who produced imported goods [ different producer can be taken], (4) if design work carried in India, then not treated as identical gods. (1) AV= Transaction value of Identical goods- (2) at same time,(3) same commercial level or at different level after adjustment, (4) adjustment on account of difference in distance and means of transport in rule 10 Note- provisionally assessed value of identical goods can’t be taken Produced includes grown manufacture and mined (1) Similar Goods- not alike in all respects but commercially interchangeable, (2) other point of identical goods are same (1) AV = TV of similar goods, (2) other points of identical goods same. Determination of value where value can not be determined under Rules 3, 4 and 5Rule 8 can be applied before Rule 7 at request of imported and approved by proper officer

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Rule 2 Rule 3 Method of valuation

Export valuation Rules 2007 Short title, commencement and application Definitions Method of valuation, AV = TV of Export goods Determination of export value by comparison, AV = TV of goods of like kind and quality


Rule 5 Rule 6 Rule 7 Rule 8

AV = Computed Value- Addition Method Residual Method- AV = Best judged value Declaration by the exporter Rejection of declared value, if reason to doubts truth & accuracy

Sec 15 Rate of duty Proviso to section 14(1) Sec 16

Rate of duty of imported goods cleared for HC- (date of BOE or EI)whichever is later Warehoused goods – date of BOE for HC, any other case- date of payment of duty Rate of Exchange notified by CBEC on date of BOE for HC or WH

Sec 17 provisions of section 17 of the Customs Act, 1962 relating to assessment of goods.

1. self assessmentof duty in- BOE/shipping bill 2. verification of self assessment- if Case selected for scrutiny- Examination of goods17(2)/Review of assessment- 17(3) 3. PO may ask documents & information- 17(3) 4. If not satisfied with document & information- reassessment of duty- 17(4) 5. Importer agree to re-assessment- Take his acceptance in writing Mark BOE for payment of duty-17(5) 6. Importer NOT agree to re-assessment- issue speaking order within 15 days-17(5) 7. AFTER CLEARANCE of goods- AUDIT can be done at importer premises of custom office

Sec 18 PROVISIONAL ASSESSMENT

PROVISIONAL ASSESSMENT in following cases (1) Unable to make self assessment (2) chemical or other test necessary(3) produced all necessary documents but po thinks enquiry necessary(4)not produced all necessary documents and po thinks enquiry necessary (2) Security = expected FA duty- PD assessed (3) Final assessment at higher rate - Demand , Interest @ 18% p.a ( from 1st day of month in which duty is provisionally assessed till date of payment), PA duty adjusted with FA duty (4) Final assessment at lower rate -refund , Interest @ 6% p.a ( from 1st day immediately succeeding the period of 3 months from date of assessment till date of refund), PA duty adjusted with FA duty Note- in case of warehouse goods if the duty finally assessed or re-assessed exceeds the duty provisionally asseseed- then for difference – bond equal to twice amount of differential duty need to be furnished. The Proper Officer may assess the goods at provisional duty if following conditions are satisfied – (a) The Importer / Exporter shall execute a bond for the difference between the duty that may be finally assessed and the duty provisionally assessed, along with the surety or security as required. (b) The Bond should contain the undertaking to pay the differential duty or produce the relevant document within the time prescribed by the Proper Officer. (c) He should deposit such sum as the Proper Officer deems fit (not exceeding 20% of Provisional Duty). (d) Violation of the above conditions will be punishable with penalty upto ` 15,000

NN-.81/2011 Conditions for Provisional Assessment of Goods

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The rate of duty and tariff vatuation for EXPORT GOODS – date of entry outward

In case of provisional assessment, if refund arises paid to importer/ exporter instead of credited to fund in following cases (i) paid by importer/ exporter— incidence of duty has not been passed (ii) import by individual – for his personal use (iii) duty and interest related to export duty (iiv duty and interest related to duty drawback. STEPS FOR Find out the word air in the que SOLVING (1) Calculate FOB (i) GIVEN (ii) C.I.F – FREIGHT- INS


(2) ADD- RULE 10(2) ADDITIONS (I) COT- (a) Not Ascertainable- 20% OF FOB (b) ASCERTAINABLE – AIR- (20% OF FOB OR ACTUAL) LESS, OTHER THAN AIR- ACTUAL (Ii) COI- (a) Not Ascertainable- 1.125% OF FOB (b) ASCERTAINABLE – ACTUAL (3) Add rule 10(1)- addition (i)Commission & Brokerage Notes- 1 buying commission not added 2) If % given then apply on FOB 3) If payment to local agent given in indian currency- add (ii)Cost of containers Note- if bond furnished that container to be exported with in 6 months- not added (iii)Design work -within india– not added -outside india- added Note- if in practical que, amt of design work given in Foreign currency - added (iv)Royalty & license fees- added 1+2+3+= C.I.F ADD- LANDING CHARGES- 1% OF C.I.F AV * ROE OFBOE OF CBEC AT PORT- HC/WH AV IN INDIAN CURRENCY A ROD- HC- ( BOE HC OR ENTRY INWARD) W.I.LATER BCD- 10% OF A B CVD- 12 % OF [ A + B} C CUSTOM CESS- 3% [ B+ C} D SP. CVD- 4% [A+ B+C+ D} E LANDED COST [ A+B+C+D+E] F CUSTOM DUTY [ B+C+D+E]

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PRACTICAL QUE

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1) RTP Nov 08 AN importer imported a shampoo. Maximum retail price (MRP) of a shampoo under customs tariff subheading No. 330510 is Rs. 800. However, its assessable value as per sec 14(1) of the customs Act, 1962 is Rs. 500. Shampoo is assessable under central excise on the basis of maximum retail price after allowing an abatement of 40%. Basic excise duty rate is 14% plus education cess of 2% and secondary and higher education cess of 1%. Basic customs duty rate is 10%. Calculate the total duty payable under the CTA 1975 on the shampoo. Ans Assessable value Add: Basic custom duty @ 10%

500 50

Total Rs Add: CVD @14 % (w.n-1)[EC & SHEC EXEMPT ON CVD] Add: Education cess (2% of custom duty)

550 67.20 2.34

Add: SH Education cess (1% of custom duty)

1.17

Total for Special CVD

620.71

Special CVD @4%

24.82


Total custom duty (R/off)

146

w.note 1 calculaton of countervailing duty value for CVD (800—320) CVD 14%

480 67.20

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2) Hitech ltd. Imported a machine from japan by Air at FOB cost of 32000 yen (Japanese). The other expenses incurred are as followsJapanese yen FOB value of accessory compulsorily supplied with machine 8000 Air fright 12000 Insurance Not known Local agents commission to be paid in Indian Rs is Rs 200 CBEC had announced exchang rate of 1 yen = Rs 0.40 Custom duty on machinery- 10% Advalorem Custom duty on accessory-20% advalorem CVD14% (effective rate is 8% vide an exemption notification) You are required to compute the assessable value from the above data.

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FOB value of accessory & Machinery compulsorily supplied with machine Air fright (w.n-1) Insurance Total CBEC had announced exchang rate of 1 yen = Rs 0.40 Converted into Indian currency (38460 *0.40)/ (9690 *0.40) Add- Local agents commission to be paid in Indian Rs is CIF value Add- Landing charges—1% Assessable value Add: Basic custom duty @ 10% but on accessory 20% because value not included in value of machinery Total Rs Add: CVD @8% (w.n-1) (EC & SHEC EXEMPT ON CVD) Add: Education cess (2% of custom duty) Add: SH Education cess (1% of custom duty)

Japanese yen 32000 6400 360 38460

8000 1600 90 9690

15384 160 15544 155-44 15699-44 1569-94

3876 40 3916 391-60 4307-60 861-52

17269-38 1381-55 27-63

5169-12 413-53 25-50

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12-75

Administration Appointment of officers of customs

Appointment of officers of customs:-Section 4(1) of the Customs Act, 1962 empowers the Central Board of Excise and Customs (CBEC) to appoint such persons as it thinks fit to be officers of customs.


powers of officers of Customs

whether CG could entrust any functions of the CBEC or any officer of Customs to any officer of any other department

Without prejudice to the provisions of sub-section (1), the Board may authorize a Chief Commissioner of Customs or a Commissioner of Customs or a Joint or Assistant Commissioner of Customs or Deputy Commissioner of Customs to appoint officers of customs below the rank of Assistant Commissioner of Customs. [Section 4(2) of the Customs Act, 1962]. An officer of customs may exercise the powers and discharge the duties conferred or imposed on him under this Act subject to such conditions and limitations as the Board may impose. He may also exercise the powers and discharge the duties conferred or imposed under this Act on any other officer of customs who is subordinate to him. However, a Commissioner (Appeals) shall not exercise the powers and discharge the duties conferred or imposed on an officer of customs other than those specified in Chapter XV (Appeals and Revision) and section 108 (power to summon persons for giving evidence) Central Government may, by notification in the Official Gazette, entrust either conditionally or unconditionally to any officer of the Central or the State Government or a local authority any functions of the Board or any officers of customs under this Act.

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Warehousing

warehouse means a public warehouse appointed under section 57 or a private warehouse licensed under section 58. A warehouse is a place where goods after landing are permitted to be removed without payment of duty. Duty is collected at the time of clearance from the warehouse. A public warehouse is owned and managed by a Government body like Central Warehousing Corporation. A private warehouse is licensed in a place where there is no public bonded warehouse. Sec 9 Board declare Warehousing station Sec 57 Appointment of public warehouse by AC/DC Sec 58 (1) licensing of private warehouse By AC/DC where facility of public warehouse not available.(2) law relating to dutiable or any other imported goods can be deposited. (3) License cancelled if contravened private warehouse provisions or giving 1 month notice, (4) suspension till finalisation of enquiry. Sec 59(1) twice amt of duty for payment of duty, interest, rent, penalty and other charges, (2) general bond Warehousing Bond can be filed for goods to be imported (3) Bond shall continue even if goods transferred to another person (4) fresh bond can be taken from transferee Sec 60 Order for deposit in warehouse if condition satisfied Sec 61 Period of warehousingwarehousing 1. 100% EOU- 3 years (input), 5 years (capital goods), interest @15% p.a after 3/5 years period Extension- if not likely to deteriorate- by commissioner any period 2. Other Assessee- 1 year, interest @15% p.a after 90 days Extension- if not likely to deteriorate-by commissioner- 6 m/ by chief commissioner any period Reduction- if likely to deteriorate period of 1 year can be reduced Board can waive interest, Pratibha Processor- No duty , no interest Sec 62 (1) all WH goods under control of Proper officer (2) no person shall enter or remove goods without Control of custom his permission, (3) warehouse locked with lock of custom department, no person break or remove over warehoused such lock,(4) power to access every part of warehouse and examine goods. goodsSec 63 Payment of rent and warehouse charges- if not paid within 10 days after due date, WH keeper may Payment of rent sell goods after notice to owner. and warehouse charges

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Warehouse As per section 2(43) of the Customs Act, 1962,


- payment of fees and permission THEN owner's right to deal with warehoused goods (a) inspect the goods; (b) separate damaged or deteriorated goods from the rest; (c) sort the goods or change the containers for the preservation, sale, export or disposal of the goods; (d) deal with the goods & their containers in such manner as may be necessary to prevent loss, deterioration or damage to the goods; (e) show the goods for sale; (f) take samples of the goods without entry for home consumption, if the proper officer so permits, without payment of duty on such samples. Sec 65 Manufacture and other operation in relation to goods in a warehouse- payment of fees and permission Manufacturing of can do manufacturing goods in Treatment of wastewarehouse and  if manufactured goods exported, duty remitted on imported content in waste ( if waste treatment of destroyed), otherwise pay duty as if waste imported, WASTE  If cleared for HC- then no remission on waste, pay duty on imported material contained in waste [ Rate of duty of date of payment taken as per sec 15(1)(c) ] Whether the issue of the imported goods warehoused in the premises of 100% EOU for manufacture/production/ processing in 100% EOU would amount to clearance for home consumption? Paras Fab International v. CCE 2010 (256) E.L.T. 556 (Tri. – LB)- No, since complete premises is treated as warehouse. Sec 66 power to exempt excessive rate on import materials used in the manufacture of goods in warehouse

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Sec 64 Right of owner of warehoused goods

Circumstances under which goods deposited in bonded warehouse can be removed

Sec 67 transferred from one warehouse to another Sec 68- Clearance of warehouse goods for home consumption, Sec 69- Clearance of warehouse goods for exportation Sec 70 Allowance in case of volatile goods Sec 72- circumstances under which goods are considered to be removed improperly from a warehouse

Removal of goods from one warehouse to another under bond, with the permission of the proper officer. For this purpose Transit Bond for concerned customs duty together with Bank Guarantee is required to be submitted. However, Bank Guarantee is not to be submitted by an EOU. (1) BOE filed for HC (2) pay duty, int, rent etc. (3) order for clearance HC, Note- no duty, if title relinquished before order for clearance for HC

Sec 73- cancellation and return of warehousing bond-

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Sec 71

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1) Bill of Export filed (2) pay export duty, int, rent etc. (3) order for clearance , Note- if goods likely to smuggled back, export only on payment of duty or subject to certain condition Remission of duty if fulfils following 2 conditions -(1) Notified goods (2) if found to less in quantity due to natural cause Goods improperly removed from warehouse- (1) Recovery action by giving notice, (2) pay duty otherwise sale of goods, (3) [ cases of improper removal- (a) where any warehoused goods are removed from a warehouse in contravention of section 71 of the Customs Act; (b) where any warehoused goods not removed from a warehouse at the expiration of the period ( within (1/3/5 years + extended period) during which such goods are permitted under section 61 to remain in a warehouse; (c) where any warehoused good have been taken under section 64 as samples without payment of duty; (d) are not duly accounted for to the satisfaction of the proper officer. if all goods cleared for HC, exported or otherwise duly accounted and all amounts due on such goods paid. Then Proper officer cancel the Bond.

Priyanshi imported certain goods in March 2009. An ―Into Bond‖ bill of entry was presented on 14th March, 2009 and goods were cleared from the port for warehousing. Assessable value was $10,00,000. The order permitting the deposit of the goods in warehouse for three months was issued on 21st March, 2009. CA MANOJ BATRA NEW BATCH- FACE 2 FACE IN DELHI-(M,W,F- MORNING) 011-47665555 SATELLITE All Over INDIA(M,W,F- Eve.)-VISIT-gaapbright.com 13

Priyanshi did not clear the imported goods even after the warehousing period got over on 20th June, 2009. She did not obtain any extension of time as well. A notice was issued under section 72 demanding duty and other charges. Priyanshi cleared the goods on 28th July, 2009. Compute the amount of duty payable by Priyanshi while removing the goods on the basis of following information: Rate of Exchange per US $

14-3-2009 Rs.48.20

Basic customs duty

15%

20-6-2009 Rs.48.40 10%

28-7-2009 Rs.48.50 12%

Assume that no additional duty or special additional duty is payable AnsComputation of customs duty = Rs.4,82,00,000

Customs duty @ 10% (note-2) Add: Education cess @ 2% and secondary and higher education cess @ 1% of customs duty

Rs.48,20,000 144600 4964600

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Total duty payable

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Assessable Value US $ 10,00,000 × Rs.48.20 (note-1)

Note 1: The rate of exchange will be the rate as in force on the date on which bill of entry for warehousing is presented. i.e 1 US $ = Rs.48.20 prevalent on 14.03.2009.

Difference between sec 74 and 75

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Note 2: In Kesoram Rayon (1996) 5 SCC 576, it has been held that goods which are not removed from the warehouse within the permissible period are deemed to be improperly removed on the day they ought to have been removed. . Hence, the applicable rate of duty is 10%, the rate prevalent on 20.06.2009. DUTY DRAWBACK

Duty Drawback u/s 74 Nature of goods Export of imported goods without process of manufacture (whether used or not) Rules notified under Re-export of imported goods (Duty respective section drawback of Custom Duties ) Rules 1995 (i) general export Modes of export

Duty Drawback u/s 75 Export of imported goods used in manufacture of goods which are exported. Custom, Central excise duties and service tax Drawback rules 1995

Refund of

Custom duty only

Custom duty Excise duty Service tax

Rates of drawback

If exported without being used 98% of import duty paid

(ii) baggage export (iii) export by post

(i) general export (ii) baggage export (iii) export by post

(i) AIR (All Industry Rate) (ii) BR (Brand Rate), if AIR


If exported after being used DDB at reduced rate *

not fixed (iii) SBR (special Brand Rate), if AIR fixed less than 80% of actual duty paid.

* if goods are exported after use then DDB at reduced rate (1) No DDB shall be allowed if goods are – Wearing apparel, Tea chest, exposed cinematography film, unexposed photographic film (2) In respect of motor Cars or goods imported by a person for his personal and private use Drawback shall be calculated By reducing the import duty paid in respect of such motorcar or goods By 4%, 3%, 2-1/2 % and 2% for each quarter or part thereof During the period of Ist, 2nd, 3rd and 4th Year respectively (3) in case of goods used after their importation and which have been out of custom control- Rate of DDB shall be as followePercentage Length of period between the date of clearance for home Of Import duty to Be consumption and the date when the goods are place under Customs Paid As Drawback. Control for export.

Sec

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Not more than 3 months 95% More than 3 months but Not, more than 6 months 85% More than 6 months but not more than 9 months 75% More than 9 months but not more than 12 months 70% More than 12 months but not more than 15 months 65% More than 15 months but not more than 18 months 60% More than 18 months Nil Sec 75A 75A(1)- INTEREST PAYABLE TO EXPORTER ON DDB GRANTED LATE Interest on 1) If the drawback payable is not paid within 1 month from the date of filing a Drawback claim, interest at the rate specified by the Board alongwith the drawback, shall be paid from the expiry of the said One month till the date of actual payment. 75-A(2)

-INTEREST

RECOVERABLE

ON

DDB

GRANTED

ERRONEOUSLY TO EXPORTER Where  any drawback has been paid to the claimant erroneously or  it becomes otherwise recoverable under this Act or the rules made thereunder, the claimant shall, within a period of 2 months from the date of demand, pay in addition to the said amount of drawback, interest  @ 18% p.a.  for the period beginning from the date of payment of such drawback the claimant till the date of recovery of such drawback.”.

DUTY DRAWBACK RULES Rule 3

DDB- ALL INDUSTRY RATE


Rule 4 Rule 6 Rule 7 – where Rate of DDB determined in low Certain cases NO DDB or restriction on DDB

Revision of Rates Rate of drawback not determined- THEN APPLY FOR BRAND RATE

The drawback amount or rate determined under rule 3 shall not exceed one-third of the market price of the export product. (1) Prohibition and regulation of drawback in certain cases- sec 76 (i) DDB due is less than Rs 50/(ii) Market Price (of Export Goods) is less than DDB (2) No DDB shall be GIVEN if :-- it is less than 1% of FOB EXCEPTION (i) iF it exceeds Rs 500/-, even if it is less than 1% of FOB] (ii) EXPORT BY POST (iii) Exports made in discharge of export obligations under Advance License; (3) NO VALUE ADDITION - (i) EXPORT VALUE < VALUE OF IMPORTED MATERIAL (ii) NO SUBSTANTIAL VALUE ADDITION- EXPORT VALUE ≤ SPECIFIED % OF IMPORT MATERIAL

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(4) RESTRICTION ON DDB- RULE 8A DDB UNDER RULE 3 I.E ALL INDUSTRY RATE SHALL NOT EXCEED 1/3 RD OF MKT PRICE OF EXPORT PRODUCT.

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DDB SHALL Sale proceed – compensated by ECGC And NOT BE RBI- waive off the requirement of realisation of proceeds on merit And RECOVERED – Exporter produces a certificate from concerned foreign mission about the fact of non- recovery R-16A RULE 16A of DDB Where sale proceeds are realized by exporter and duty drawback has been recovered from him , Rules 1995 the exporter produce evidence of realization with in [3 months] from date of such realization.

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The period may be extended by the Commissioner by 9 months subject to the condition that the amount has been realized on a date covered by the extensions of time limit given by the RBI for realizing export proceeds. Application fee equivalent to 1% of the FOB value of exports or Rs. 1000/-, whichever is less, shall be payable for applying for grant of extension by the Commissioner.

COASTAL GOODS

COASTAL GOODS Procedure

COASTAL GOODS MEANS goods transported in a vessel from one port of India to another port in India other than imported goods. (I.e. no export import is involved) The consignor shall MAKE ENTRY BY PRESENTING A BILL OF COASTAL GOODS to the proper officer. The master of vessel shall not permit loading of any coastal goods on the vessel until such bill has been passed and delivered by the consignor to master. The master shall carry such bill on board and at the destination shall deliver the bill to proper officer of the port of unloading Proper officer shall permit clearance if he is satisfied that the goods are entered in the bill.


The master shall carry an advice book on board, supplied by the custom authorities. The proper officer at each port of call shall make entries relating to the goods loaded on the vessel at that port. Coastal goods shall be loaded or unloaded only at appointed customs/ coastal port. The master shall allow the ship to leave the port only after a written order has been given by proper officer.

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STORES WAREHOUSED without assessment of duty Transit and transshipment of stores

Stores may be allowed to be warehoused without assessment of duty if stores to be supplied to Foreign going vessel or aircraft.

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FOREIGN GOING VESSEL OR AIRCRAFT

STORES Stores means goods for use in a vessel or aircraft and includes fuel and spare parts and other articles of equipment, whether or not for immediate fitting. The definition does not cover goods for use in a vehicle. MEANS any vessel or aircraft for the time being engaged in the carriage of goods or passengers between any port or airport in India and any port or airport outside India whether touching any intermediate port or airport in India or not And Includes (i) Any Naval vessel of a foreign Govt. taking part in naval exercises (ii) Any vessel engaged in fishing or any other operations outside the territorial water of India (iii) Any vessel or aircraft proceeding to a place outside India for any purposes whatsoever

(1) Any stores imported in a vessel or aircraft may, without payment of duty, remain on board such vessel or aircraft while it is in India. (2) Such stores, with the permission of the proper officer, be transferred to any vessel or aircraft as stores for consumption therein.

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However such transfer shall be allowed only if the RECEIVING VESSEL is entitled to CONSUME the stores FREE OF DUTY. Consumption of stores Sec 88

Such stores may be consumed without payment of duty as stores during the period such vessel or aircraft is foreign-going vessel

explain the provisions of Section 89 of the Customs Act, 1962 with regard to supply of ship stores.

Section 89 of the Customs Act, 1962 covers the case of indigenous goods, which are supplied to a vessel as ship stores. Goods produced or manufactured in India and required as stores on a foreign going vessel or aircraft may be exported free of duty in such quantities as the proper officer may determine having regard to the size of the vessel or the aircraft, the number of passengers and the crew and the length of voyage or journey on which the vessel or aircraft is about to depart. In other words, the duty free supply of ship stores should be reasonable and not in commercial quantities.

SEC 90. CONCESSIONS IN RESPECT OF IMPORTED STORES

Imported stores may without payment of duty be consumed on board a ship of the Indian Navy i.e. (i) stores for the use of a ship of the Indian Navy

The whole of the duty shall be allowed as drawback u/ s 74 on fuel and lubricating oil taken on board any foreign-going vessel or aircraft as stores.


FOR THE NAVY:

(ii) Stores supplied free by the Govt. for the use of the crew* of a ship of the Indian Navy in accordance with the conditions of the service. In respect of such stores 100% drawback shall be allowed and imported stores may be supplied without payment of duty on board a ship of the Indian Navy.

Sec 82 Section 83

IMPORT OR EXPORT BY POST Any label or declarations, which accompany the goods, containing- the description, quantity and Value shall be deemed to be entry for import/ export.

For import RATE OF DUTY AND TARIFF VALUATION SHALL BE OF the date On which postal authorities present a list of goods to proper officer Provided that if the list of the goods was presented before the date of the arrival of the vessel, it shall be deemed to have been presented on the date of such arrival

The procedure for clearance of imported goods by post is as under: (i) The Postmaster hands over to Principal Appraiser of Customs the memo which shows total number of parcels from each country of origin, parcel bills or senders declaration, customs declaration and despatch notes, and other information that may be required. (ii) The mail bags are opened and scrutinised by Postmaster under supervision of Principal Postal Appraiser of Customs. Packets which are suspected of containing dutiable goods are separated and presented to Customs Appraiser with letter mail bill and assessment memos. (iii) The Customs Appraiser marks the parcels which are required to be detained as (a) necessary particulars are not available or (b) mis-declaration or under-valuation is suspected or (c) goods are prohibited for import. Other parcels are assessed without opening, on the basis of details given in parcel bill or dispatch notes. The duty is assessed and is entered on parcel bill. These are then audited and returned to Postmaster. Postmaster will hand over parcel to addressee only after collecting the customs duty. (iv) Parcels selected by Appraiser for examination are opened and examined. If required, details are called from addressee. After inspection, the parcels are sealed with a distinctive seal. If misdeclaration or under-valuation is noted or goods are prohibited goods for imports these will be detained and reported to Customs Commissioner. After assessment, these will be handed over to Post Master, who will further hand over to addressee on receipt of payment of customs duty.

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procedure for clearance of goods imported by post.

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(ii) For export THE RATE OF DUTY AND TARIFF VALUATION SHALL BE of the date on which exporter delivers such goods to postal authorities for exportation.

BAGGAGE Sec 77

Declaration by owner of baggage

Sec 78

Determination of the rate of duty and tariff valuation in respect of baggage Relevant Date = Date of filing of Declaration of its contents

Sec 79

Bona fide baggage exempted from duty


exemption to baggages under section 79(1) of the Customs Act, 1962.

Sec 80

Section 79(1) of the Customs Act, 1961 exempts the bona fide baggage of the passengers. Following baggage is passed free of duty(i) articles in the baggage of a passenger/crew for the minimum period prescribed by the Baggage Rules, 1998. These Rules, as on date, do not prescribe any minimum period for use of articles by the passenger/crew. However, totally unused articles may not be held as bona fide baggage. (ii) articles for use by passenger or his family or bona fide gifts or souvenirs provided that the value of each such article and the total value of all such articles does not exceed the limits prescribed in the aforesaid Baggage rules. Temporary detention of baggage of persons- if Dutiable or Prohibited Article & True Declaration about the article has been made u/s 77, PO may detain article which will be returned while he was leaving India

R-7 OF BAGGAGE RULES A tourist arriving in india shall be allowed clearance free of duty of the articles in his bonafide baggage

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R-3 AND 4 OF BAGGAGE RULES


Rule 5 Professionals

An indian passenger who was engaged in his profession abroad shall, on his return to india, be allowed clearnce free of duty in addition to what he is allowed under Rule 3 or rule 4 A B

Indian passenger returning after I

Used house hold articles upto Rs 12000

atleast 3month

Professional equipment upto Rs 20000

II

Indian passenger returning after I

Used house hold articles upto Rs 12000

atleast 6 month

Professional equipment upto Rs 40000

II

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Used household articles and personal effects

stay of minimum 365 days DURING

In possession of the passenger or his family

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on

abroad for atleast 6 months and which are

termination of his work, and who;

Not mentioned in annexure I or annexure II

has not availed this concession in

Upto Rs 75000

preceding

2

years

the preceding 3 yrs PROFESSIONAL EQUIPMENT means such portable equipments, instruments required in his profession by a carpenter, plumber, a welder etc. and It shall not include items of common use such as cameras, cassette recorders, personal

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computers, typewriters. Rule 6 Passenger returing to india shall be allowed clearance free of duty of the jewellery in his bonafide baggage – returning after residing abroad over 1 year For gentleman passenger- Rs 10000 For lady passenger- 20000 Rule 8 Permanent transfer of residence IN addition to general free allowance under rule 3 and 4, following other exemptions (1) used personal effect (2) jewellery upto 10000 for gentleman and 20000 for lady passenger Conditions

conditions

Minimum stay of 2 years abroad,

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relaxation Short fall of upto 2 months in stay

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Immediately preceding the date of his arrival abroad can be condoned by AC on transfer of his residence

If the early return is on account of terminal

leave

being

availed by the passenger or any other

special

circumstances. 2

Total stay in India on short visit during the 2 Commissioner may condone short preceding years should not exceed 6 months visit in excess of 6 months in and

3.

deserving cases

Passenger has not availed this concession in No relaxation

preceding 3 years Further exemption allowed on Jewellery taken out earlier by the passenger or by a member of his family from India.- if AC is satisfied regarding jewellery taken outside india.


Que 1- An Indian resident Visiting Germany brought following goods while returning to India (a) his personal effects like cloth etc. valued at Rs 25000 (b) 2 litre of liquor of Rs. 1600 (c) New Camera of Rs. 39800 what is custom duty payable. Ans- 36.05% of 6400= 2307-20 Que 2- an Indian resident goes to Nepal on tour. He purchases colour TV of Rs. 18000, a laptop computer of Rs. 79000 and hair dryer of Rs. 2000 in a duty free shop in Nepal and brings the same to India. What id duty payable (a) if he returns on 3rd day by Air (b) if returns on 3rd date by land route (c) if he returns on 11th day by air (d) if he returns on 11 day by land route. Ans (a) no GFA 36.05% of 20000=7210 (b) 7210 (c) GFA- 6000 , 36.05% of 14000=5047(d) Ans (a) Que 3- Mr. and Mrs. Khanna visited USA and boughe a personal computer for Rs. 38000 and a laptop computer of Rs 98500 while returning to India, besides their personal effects valued at Rs. 86000. what is custom duty payable. Ans- GFA can’t be Pooled (38000-35000)= 3000*36.05%=1081-50

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In every case (a) in which anything is liable to confiscation or (b) any person is liable to a penalty, such confiscation or penalty may be adjudged, by – value of goods Authorized officer Value upto 50000/Gazetted Officer of Customs lower in rank than an [AC or DC Value exceeding 50000 but upto 5 lakh AC/DC Value exceeding Rs. 5 Lakh Comm./joint comm.. of Custom Any order or decision passed or any summons or notice issued under this Act, shall be served (a) by tendering the order, decision, summons or notice or sending it by [registered post or by such courier as may be approved by the Commissioner of Customs;] or (b) if the order, decision, summons or notice cannot be served in the manner provided in clause (a), by affixing it on the notice board of the customs house.

SECTION 153. SERVICE OF ORDER, DECISION, ETC. –

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SECTION 122. ADJUDICATION OF CONFISCATIONS AND PENALTIES. –

[(4) Notwithstanding anything contained in the Code of Criminal Procedure, 1973), any offence relating to — (a) prohibited goods; or (b) evasion or attempted evasion of duty exceeding 50 lakh rupees, shall be cognizable. ( i.e arrest without warrant in above 2 cases (5) Save as otherwise provided in sub-section (4), all other offences under the Act shall be noncognizable. (6) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, all offences under the Act shall be bailable.]

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SECTION 104. POWER TO ARREST

NEW BATCHESFACE 2 FACE IN DELHI-(M,W,F- MORNING)- TIMING- 6-30 A.M TO 10 A.M SATELLITE ALL OVER INDIA(M,W,F- EVENING)-FOR Detail of centres- VISIT-gaapbright.com CONTACT-BRIGHT- 011-47665555
