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News Indirect Tax-Customs

  • Apr 22, 2020
  • Lockdown effect: CBIC extends facility of import, export without furnishing bonds to Customs till May 15

    The Central Board of Indirect Taxes and Customs (CBIC) on Tuesday extended the deadline to import and export goods without furnishing bonds to the Customs authorities by a fortnight till May 15, a move aimed at facilitating trade during the COVID-19 lockdown. In a circular, the CBIC said businesses will, however, have to furnish proper bond to the Customs authorities by May 30 for import and exports done through undertaking till May 15.

    In view of the lockdown, the apex indirect tax body had earlier set end April as the date for import and exports by issuing undertaking. In view of the extension of lockdown till May 3, the trade facilitation measure has now been extended till May 15.

  • Apr 14, 2020
  • CBIC asks tax officers not to seek physical submission of documents for clearing refund dues

    The CBIC has asked its field officers to avoid asking for physical submission of documents from entities who are claiming GST and customs refunds. The Central Board of Indirect Taxes and Customs (CBIC) is running a ‘Special Refund and Drawback Disposal Drive’ this month to clear Rs 18,000 crore worth pending refunds.

    In a letter to Principle Chief Commissioners, the CBIC has said that for facilitation of taxpayers, all communication by field offices must be done using official email IDs. “It may please be noted that the prescribed process doesn’t warrant any physical submission of documents and any such practice must be avoided,” it added.

    The CBIC said the decision to process pending refund claims has been taken with a view to provide immediate relief to the taxpayers in these difficult times even though the GST Law provides 15 days for issuing acknowledgement or deficiency memo, and total 60 days for disposing of refund claims without any liability to pay interest.

  • Apr 10, 2020
  • Government exempts customs duty, health cess on essential medical goods

    In view of the growing demand for ventilators, face masks & surgical masks, PPEs and covid test kits, the central government today decided to grant exemptions from basic customs duty and health cess on the import of these goods.

    This was done considering the escalating demand for medical goods as India enters a crucial phase in its covid-fight. As of now, the country has recorded 5,865 confirmed cases and 169 deaths as various state governments has urged the centre to extend the nation-wide lockdown.

    The health ministry stressed on the rational use of personal protective equipment (PPE) by healthcare workers treating coronavirus patients amid concerns over their dwindling numbers in the country.

  • Apr 04, 2020
  • CBIC allows traders to import, export goods without furnishing bonds

    The Central Board of Indirect Taxes and Customs (CBIC) has allowed traders to submit an undertaking instead of furnishing bonds – required by customs for assessment and clearing of goods – in order to prevent delays or disruption in exports or imports caused by Covid 19 pandemic.

    The decision was taken after field formations flagged the unavailability of notarised stamp papers for furnishing the bonds that was being faced by importers, exporters and their authorised custom brokers, during the lockdown period. The Board will review the order after April 14, when the nationwide lockdown ends.

    “In light of unprecedented situation caused due to Covid 19 pandemic, Board has decided to take certain measures for a temporary period, with a view to expedite customs clearance of goods and for maintaining balance between customs control and facilitation of legitimate trade,” CBIC said in a notice Friday, giving relaxation of furnishing bonds till April 30.

    “In the period up to April 30, customs field formations may accept requests for submission of an undertaking from the importer/ exporter in lieu of a bond,” it added.

  • Feb 14, 2020
  • No customs duty on imported solar cells and modules, says ministry

    The Ministry of New and Renewable Energy (MNRE) clarified that the basic customs duty (BCD) on imported solar cells and modules would remain nil in the current financial year.

    In this year's Union Budget, two new item heads were inducted in the customs duty bracket which pertained to solar cells and modules. The Budget proposed a 20 per cent BCD on solar equipment. However, these items will continue at ‘nil’ BCD,” according to the budget speech.


    The announcement led to confusion with the industry claiming that solar equipment is exempted from BCD. Solar cells and modules (under item number 8541) are exempted from any BCD, according to a 2005 notification of the department of revenue.

    MNRE in its notice issued on Thursday said solar will not attract any BCD. “Though the tariff rate on the new tariff items has been increased from nil to 20 per cent, the BCD on (solar cells, not assembled) and (solar cells, assembled in modules or made into panels), remains nil,” said the notice.

    There is already a safeguard duty of 15 per cent levied on imported solar cells and modules, especially those coming from China. Senior officials said the if BCD would be imposed or not from next fiscal would be decided after the safeguard duty expires in July.

  • Feb 04, 2020
  • Customs department may quiz importers on FTA claims

    Indian customs authorities will now be able to question the valuation of imports under free trade agreements (FTA) for up to five years with the country proposing a significant shift in the domestic framework of rules of origin to tackle largescale imports.

    The rules of origin are criteria to determine the source country of a product, based on which they either get tariff concessions or are subjected to duties.

    “Retrospective verification of costing data, value-addition compliance and certificate of origin can be conducted by the customs authorities over a period of five years from the date of import, unless there is a specific time limit prescribed in the FTA... Customs officers will be empowered to check for violations in claims by importers,” said an official aware of the details. “They can enquire and question the claims made in the last five-year period.”

    Further, a certificate of origin submitted by an importer will no longer be the threshold for availing concessional benefits.

    Customs authorities can ask importers to substantiate and satisfy scrutiny undertaken on the question of origin.

    The February 1 budget proposed to amend the customs law by introducing stringent provisions related to rules or origin to strengthen the hands of customs officers to check abuse of FTA provisions.

  • Jan 27, 2020
  • India likely to raise import duties on more than 50 items in Budget

    India plans to increase import duties on more than 50 items including electronics, electrical goods, chemicals and handicrafts, targeting about $56 billion worth of imports from China and elsewhere, officials and industry sources said.

    Finance Minister Nirmala Sitharaman could make the announcement when she presents her annual budget for 2020/21 on Feb. 1, along with other stimulus measures to revive sagging economic growth, one of the government officials said.

    Higher customs duties are likely to hit goods such as mobile phone chargers, industrial chemicals, lamps, wooden furniture, candles, jewellery and handicraft items, two government sources with direct knowledge of the matter said.

    The move could hit smartphone manufacturers that still import chargers or other components such as vibrator motors and ringers, along with retailers such as giant IKEA that is in the process of expanding its footprint in India.

    IKEA had previously flagged higher Indian customs duties as a challenge.

    The government had identified items and decided to increase import tariffs by 5%-10% as recommended by a panel of trade and finance ministry officials, among others, the second government official said.

  • Oct 17, 2019
  • India imposes anti-dumping duty on certain steel imports

    India has imposed a provisional $29-$200 a tonne anti-dumping duty to rein in burgeoning and predatory imports of galvalume steel products from China, Vietnam and Korea which were causing material injury to the domestic industry. The duty will remain in effect for six months. JSW Steel Coated Products, a unit of Sajjan Jindal-led JSW Steel, had moved a petition before the Directorate General of Trade Remedies (DGTR) for imposition of the trade remedial measure on imports of the high-end aluminium and zinc coated flat products (galvalume) that find application in roofing purposes to making auto parts. Following investigations, the DGTR found that exporters from these three countries were sending galvalume to India “below their normal values”, causing “material injury” to the domestic producers like JSW Steel, Tata Steel and Bhushan Power and Steel among others. “There is a significant increase in imports of subject goods from subject countries in absolute terms as well as in relation to production and consumption in India.

  • Sep 26, 2019
  • Govt probing significant rise in imports of single-mode optical fibre, may impose safeguard duty

    The government may impose safeguard duty on imports of single-mode optical fibre, as it has initiated a probe into sudden and significant surge in the inbound shipments of the product following a complaint from the domestic industry. According to a notification of the Directorate General of Trade Remedies (DGTR), an application has been filed by Sterlite TechnologiesNSE 2.50 % and Birla Furukawa Fibre Optics for imposition of safeguard duty on the fibre as the increase in imports is impacting them.

  • Sep 19, 2019
  • Govt scraps import duty on open cell TV panel to boost manufacturing

    The government has scrapped import duty on open cell TV panel used to make television sets, as it aims to boost local manufacturing by lowering input costs for TV makers who have been complaining about a slump in demand. The decision to remove 5 percent customs duty will help reduce manufacturing cost by around 3 percent but it wasn't immediately clear if all TV makers will pass on the benefit to consumers. Panasonic said it will pass on the benefit of 3-4 percent reduction to consumers. Finance Ministry in a notification said customs duty on "open-cell (15.6-inch and above), for use in the manufacture of Liquid Crystal Display (LCD) and Light Emitting Diode (LED) TV panels" will be nil as against 5 percent import duty previously.

  • Sep 18, 2019
  • Finance ministry scraps import duty on open cell LED TV panel

    The ministry of finance has scrapped the import duty on open cell LED TV panel from 5% to zero in a late night notification issued on Tuesday. This is the most critical component used in LED TV manufacturing accounting for 65-70% of the total production cost. This is going to reduce television prices considering around 60-65% of TV sets sold in the country are locally produced where the TV panel is procured after paying 5% import duty and also going to give a boost to the Make in India initiative. The government notification issued said “open cell (15.6 inch and above) for use in the manufacture of Liquid Crystal Display (LCD) and Light Emitting Diode (LED) TV panels” has been made nil with immediate effect.

  • Aug 27, 2019
  • Panel to take decision within 60-days under tax amnesty scheme: CBIC

    The revenue department on Monday said the designated committee will take a decision within 60 days on declaration made by an assessee for relief under the service tax and excise duty amnesty scheme. Sabka Vishwas - Legacy Dispute Resolution Scheme, 2019, to reduce legacy service tax and central excise cases will become operational for four months beginning September 1. The scheme provides for total waiver of interest, penalty and fine in all cases, and also immunity from prosecution, the Central Board of Indirect Taxes and Customs (CBIC) said in FAQs on the scheme. On how will an applicant come to know about the final decision taken by the designated committee on his or her declaration, the FAQs said: "Within sixty days of filing of a declaration, you will be informed electronically about the final decision taken in the matter".

  • Aug 26, 2019
  • India plans extra tax on vegetable oil imports to boost domestic output: Sources

    India plans to impose an extra 5% tax on vegetable oil imports within weeks and use the revenue to help boost the country's stagnating oilseed production, two government sources said. India is the world's biggest importer of vegetable oils, buying nearly $10 billion worth a year, its biggest import after crude oil and gold. The country's consumption of vegetable oils - including palm oil and soyoil - has trebled over the last 20 years as the population grew and incomes rose, while output has increased by less than a third. Now, the government plans to create an oilseed fund by imposing the 5% surcharge, or cess, that will be used to help Indian farmers step up oilseed production, said the sources, who did not wish to be identified in line with government policy.

  • Aug 20, 2019
  • Nirmala Sitharaman rejects demand for rollback of customs duty on newsprint

    Virtually rejecting demand for rollback of the 10 per cent customs duty on newsprint, Finance Minister Nirmala Sitharaman on Monday said the duty was imposed to promote domestic manufacturers and the importers will have to pay tax on the shipment. Newspaper industry had earlier made a representation to the finance minister for rollback of the Budget’s announcement of customs duty imposition on imported newsprint, arguing the move will put pressure on the bottomline. There was no import duty on newsprint so far. The intention of the government was to make sure that Indian manufacturers of newsprint are promoted as they were suffering due to cheaper import, she said at an event here.

  • Aug 17, 2019
  • Customs to recover export benefits claimed on reimported goods

    Tax authorities will soon start recovery of exports benefits claimed on goods that were reimported in the past under some incentive schemes, a decision that will impact some exporters. The Central Board of Indirect Taxes & Customs (CBIC) has sent out a directive to tax officials following observations by Comptroller and Auditor General (CAG) that there was no provision in earlier customs notifications to recover the duty benefit claimed on exports on reimport of the merchandise.

  • Aug 09, 2019
  • India to hike import duty on solar equipment in coming years: Power Minister

    In a bid to encourage domestic manufacturing, India will increase import duty on solar equipment down the value chain in the coming years, Power Minister R K Singh said on Thursday. "Right now safeguard duty is imposed on solar equipment which will be diluted in few years. We will increase tariff on solar equipment down the value chain in coming years," the minister said at a curtain raiser press conference on 3rd Global RE-Invest.

  • Aug 03, 2019
  • Anti-dumping duty likely on certain type of steel from Brazil, China, Germany

    The government may impose an anti-dumping duty of up to USD 3,263 per tonne on imports of a certain type of steel from Brazil, China, and Germany for five years, according to a government notification. The commerce ministry's investigation arm DGTR has recommended the duty after concluding its probe on alleged dumping of 'High Speed Steel of Non Cobalt Grade' being imported from these three countries. This steel is used for making high-speed steel-cutting tools. It has concluded that the product has been exported to India from these nations below its normal value, which was resulting in dumping of the product.

  • Jul 05, 2019
  • Budget 2019: Govt proposes to increase import duty on gold to 12.5 per cent

    The government Friday proposed to increase import duty on gold and precious metal to 12.5 per cent, a move which would make the yellow metal and jewellery expensive in the domestic market. "It is proposed to increase custom duty on gold and other precious metals from 10 per cent to 12.5 per cent," Finance Minister Nirmala Sitharaman said in her Budget speech. The decision came at a time when the domestic jewellery industry was demanding a cut in the import duty. The commerce ministry, too, had in past recommended for reduction in the duty.

  • Jun 29, 2019
  • Customs regime may be tweaked to boost make in India, exports

    India is likely to revamp its customs duty regime, weeding out some exemptions and correcting inverted duty structures to give a boost to the government’s Make in India manufacturing initiative as well as exports. It is also considering easing of procedures for industry such as anonymous assessments and speedier clearances, while taking steps to curb evasion.

  • Jun 27, 2019
  • CBIC to move to desk-based filing for small taxpayers

    The audit department of the Central Board of Indirect Taxes and Customs (CBIC) has developed risk parameters for selecting taxpayers to be audited on the basis of annual returns. However, the department has instructed officials to move to desk-based filing for small taxpayers, instead of the traditional method of premise-based audits. In a detailed letter on how to conduct audits, the department said premise-based audit still has to be conducted for medium and large category of taxpayers. Further, such audits should be undertaken in a time-bound manner to ensure completion within the stipulated time period of three months from the commencement of audit, it said. Pratik Jain, partner and leader – indirect tax, PwC India, said: “Such guidelines have been issued for GST audits for the first time. One will have to see whether state governments would come out with similar guidelines for conducting audits of taxpayers under their (SGST) administration. Assigning of risk scores to various dealers for selection of audit is needed for the authorities to focus on cases where possibility of tax leakage is more.”

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