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CUSTOMS ACT, 1962
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LEARNING OUTCOME
Understanding provisions of Levy, Exemptions, Assessment of Custom Duty
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(A) Imposition of customs duty
Levy Assessment Collection
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(B) Factors to determine liability
Goods on which – duty is leviable Point and circumstances of duty Mechanism for assessment Exemption from duty Remission and abatement of duty Relevant date of rate and tariff
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(ii) Point and circumstances
Taxable point Clearance of goods Re-importation of goods produced in India (U/s 20) Duty on derelict/ jetsam/ wreck (U/s 21)
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(iii) Assessment u/s 2 (2)(a) Means :- Determination of : duty value of goods duty payable along with other documents.(b) Statutory definition: Self assessment (section 17) Re-assessment (section 17) Provisional assessment (section 18) Any assessment – duty assessed is NIL
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self Assessment u/s 17 Applies to:- an importer entering any imported goods (U/s 46)- an exporter entering any exported goods (U/s 50)SHALL SELF-ASSESS THE DUTY – LEVIABLE ON SUCH GOODS. Verified by proper officer – examine or test:- Imported goods- Exported goods Electronically mandatory – manually specifically
permitted by Commissioner
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re-Assessment u/s 17
INCORRECT SELF-ASSESSMENT U/s 17 (4):
- On verification/ examination/ testing- Self- assessment – Not done correctly- Proper officer may – Re assess the duty leviable
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re-Assessment u/s 17 PASSING OF SPEAKING REASSESSMENT ORDER:Any re assessment – done under 17 (4): And it is contrary to self- assessment done – by
importer/ exporter – regarding: valuation, classification, exemption/concessions
OR Importer/ exporter – does not confirm –
acceptance – said re assessment in writing. Pass order – within 15 days - date of re assessment
– bill of entry/ shipping bill
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re-Assessment u/s 17 PASSING OF SPEAKING REASSESSMENT ORDER:Any re assessment – done under 17 (4): And it is contrary to self- assessment done – by
importer/ exporter – regarding: valuation, classification, exemption/concessions
OR Importer/ exporter – does not confirm –
acceptance – said re assessment in writing. Pass order – within 15 days - date of re assessment
– bill of entry/ shipping bill
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Audit of self assessment Where re- assessment/ speaking order – not
passed. Proper officer may audit:- Assessment of duty- At his office/ at the premises - imported/ export
goods- In manner prescribed – On site Post clearance Audit
at the Premises of Importers and Exporters Regulations, 2011
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provisional Assessment u/s 18
It is pending Final Assessment
Cases U/s 18 (1): When importer unable to make self assessment Where proper officer – deems it necessary – to
carry out – chemical or other tests When importer/ exporter – submitted/ produced –
all documents – P.O. – make further enquiry Where necessary documents – Not submitted
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Exemption U/s 25
General Special
General: Central Govt. – satisfied – necessary in public interest – exemption (absolutely/ subject to conditions)
Special: Central Govt. – satisfied – necessary in public interest – Special Order ( in exceptional nature) – exempt goods – from payment of duty (cash)
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Exemption U/s 25
Grounds for exemptions: Moral Grounds:- Goods do not reach Indian soil- Goods reached India but not available for
consumption- Goods damaged/ deteriorated in transit. Discretionary Grounds: Central Govt., allow
exemption :- For controlling economy- Industrial growth of the country
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Exemption U/s 25
Exemption not exceed Statutory Duty Date of implementation Preferential Rate of duty Lower rate of duty under trade agreement
(determination of origin)
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Remission and abatement
Remission/ Abatement of duty:
In case of pilfered goods (U/s 13) In case of damaged/ deteriorated goods (U/s 22) In case of lost/ damaged or abandoned goods (U/s
23) Short-packed or short-landed goods
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Remission on Pilfered GoodsImporter – not liable to pay duty, if:
Imported goods – pilfered (small theft);Such pilferage – take place- After the un loading thereof and- Before the proper officer – made order for:
- clearance for home consumption- deposit in warehouse
If restored (goods): liable to pay dutyPilferage in Custody: Custodian is liable to pay duty.
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Remission on Pilfered GoodsSituation 1: before arrival of goods in India – No Liability.Situation 2: after arrival but before customs clearance – Liable to pay (but extinguished U/s 13 of the Act)Situation 3: after custom examination – but before order of clearance – Liable to pay – but can claim refund.
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Remission on lost, destroyed, abandoned
Situation 1: Lost or destroyed It is shown - To the satisfaction of Assistant/ Deputy
Commissioner- That goods – have been: a) Lost (other than
pilferage); b) destroyed- Any time - before clearance - home consumption.Treatment:Assistant/ Deputy Commissioner – shall remit duty on such goods.
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Remission on lost, destroyed, abandoned
Situation 2: Relinquishment of TitleOwner of goods – any time before :- Order for home consumption (U/s 47)or- Deposit in warehouse (U/s 60)- Relinquish the titleTreatment:Shall not pay duty on such goods. but not in case of offending goods
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Remission on damaged or deteriorated goods
Any of the three circumstances:Situation 1: before arrival of goods in India –Situation 2: after arrival but before customs clearanceSituation 3: after custom examination – but before order of clearance
Then relief of duty - out of total duty is given on such goods
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Short packed or short landed goods
Short Packed: not reached Indian territory – NO DUTY
Short landed: by mistake: unloaded at other port or not unloaded – destination: NO DUTY