Staying Updated

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In the issue Customs

Foreign trade policy (FTP)

Customs, FTP and WTO newsletter

In the issue Customs

Notifications and circulars

• Permanent Trade Facilitation Committee at each of the Customs locations set up to involve

stakeholders such as trade bodies in resolving operational issues at customs

Others

• Refund of duty paid on repair and freight charges for re-imported goods could not be denied when no abatement was granted in respect of the damaged goods at the time of first import

Foreign Trade Policy Case law

November 2013: Volume 16 Issue 8

Anti-dumping duty Contacts

customs

• Exemption of SAD on import of parts, components and accessories of mobile phones for manufacture of handsets available on issuance of certificate from the jurisdictional excise authorities

Case law Valuation

• CVD not leviable on MRP basis when goods are exempt from applicability of the Legal Metrology (Packaged Commodity) Rules, 2011

• Transaction value of imported finished goods cannot be rejected based on price of raw materials in

Case law

• Re-export permitted as goods not prohibited for imports even if mis- declaration made regarding origin of goods

• Benefit available to DTA units also available to EOU units once duty obligation was discharged at the time of de-bonding

Anti-dumping duty

• Levy of provisional anti-dumping duty on imports of Methylene Chloride falling under chapter 29, originating in, or exported from, the European Union, USA and Korea RP for six months from 21 October,

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In the issue Customs

Foreign trade policy (FTP) Anti-dumping duty Contacts

Customs

• The Central Government as a trade facilitation measure has instructed the Permanent Trade Facilitation

Committee (PTFCs) in each customs house, amongst others, to hold regular meetings and allow apex trade bodies to attend these to resolve issues that impact day to day functioning.

(Circular No. 42/2013 dated 25 October, 2013)

• The Central Government has clarified that exemption from Special Additional Duty (SAD) of Customs is available to parts, components and accessories for manufacture of mobile phones as these

is not liable to pay CVD on Maximum Retail Price (MRP) basis as the pre- packaged goods having weight less than 10 gms are exempt from applicability of the Legal Metrology (Packaged

Commodity) Rules, 2011 (PC Rules).

• The Mumbai Tribunal, in Hindustan Lever LtdvCC (2013-TIOL-1630- CESTAT-MUM), held that where the goods are sold in number but the weight per piece being exempt from the

applicability of PC Rules, the importer is not liable to pay CVD on MRP basis.

• In SR LitesvCC (2013 (296) ELT 498), the Delhi Tribunal held that the

transaction value of imported finished goods cannot be rejected basis price of manufacture of mobile phones as these

are exempt from levy of basic customs duty and countervailing duty in lieu of excise (CVD). This exemption is available under Notification No.

21/2012-Cus dated 17 March, 2012 on the basis of a certificate from

jurisdictional excise authorities.

(Circular No. 43/2013-Customs dated 8 November, 2013)

Case law Valuation

• In Pidilite Industries LtdvCC (2013- TIOL-1592-CESTAT-MUM), the

Mumbai Tribunal held that the importer

raw materials in India as value can be re-determined only on legally

permissible grounds such as mis- declaration of description or

contemporaneous imports at higher value in terms of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 (CVR).

• The Delhi Tribunal, in Imperial Glass EmporiumvCC (2013 (297) ELT 49), held that in order to reject the

transaction value of the imported goods, the manufacturing cost and price of raw material of the country of manufacture is to be considered and not raw material cost in India.

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• In Choudhary Ship BreakersvCC (2013-TIOL-1736-CESTAT-MUM), the Mumbai Tribunal held that customs duty was leviable on the re-negotiated price paid as consideration to the supplier, and not on the higher price that was never paid, since in terms of the Customs Act, 1962 (the Act), the duty is payable on the price paid or payable to the seller.

• The Mumbai Tribunal, in CCvCipla Ltd (2013 (297) ELT 281), held that

transaction value could not be enhanced based on quotation in absence of any of the legally permissible grounds in terms of CVR such as payment over and above invoice value.

Others

• In Matwar & CovCC (2013- TIOL- 1645-CESTAT-DEL), the Delhi Tribunal held that import of old and used goods without licence should be considered as smuggled goods as these are restricted for import.

• The Mumbai Tribunal, in CCvEscorts Mahle Ltd (2013-TIOL-1614-CESTAT- MUM), held that refund of duty paid on repair and freight charges for re-

imported goods could not be denied where, during the first import, the authorities had charged duty on full value without any abatement towards damage, as duty cannot be charged twice on the same goods.

invoice value.

• In CCvGujarat Pipavav Port Ltd (2013 (297) ELT 200), the Ahmedabad Tribunal held that payments made in relation to obligatory inspection

certificate provided by foreign supplier of goods was includible in the

transaction value of the imported goods as the expense was a condition of sale.

• The Delhi Tribunal, in CCvGanesh Trading Company (2013 (297) ELT 75), held that importer could not be

precluded from challenging assessment of Bills of Entry at enhanced value where the customs authorities had not cited any reasons for rejection in terms of CVR.

twice on the same goods.

• The Delhi Tribunal, in Rahul CraftvCC (2013-TIOL-1672-CESTAT-DEL), held that service of order was considered to be effected where it was properly addressed, prepaid and posted by registered post in terms of the Act.

• In P S Tech (P) LtdvCC (2013 (296) ELT 468), the Bangalore Tribunal held that where the customs authorities directed the importer to file refund claim in a particular format, the claim would not be hit by limitation as the earlier letter filed for refund can be treated as the refund claim.

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• The Delhi Tribunal, in CCvArt Live (2013-TIOL-1742-CESTAT-DEL), held that amendment of Bill of Entry in terms of section 149 of the Act could be allowed subject to the discretion of the customs authorities on the basis of proof

submitted by the importer that there was no intentional mis-declaration.

• In B G ExplorationvCC (2013-TIOL- 1653-CESTAT-MUM), the Mumbai Tribunal held that the benefit of an exemption notification could not be denied where there was no end-use condition in the notification as the benefit was available on fulfilment of the condition prescribed therein and there was no need to act beyond those.

there was no need to act beyond those.

• The Mumbai Tribunal, in Veekay Products (P) LtdvCC (2013 (296) ELT 363), held that the refund of fine or penalty amount could not be credited to Consumer Welfare Fund as the principle of unjust enrichment as in case of refund of duty was not applicable in case of refund of penalty amount.

• The Delhi Tribunal, in Sony India Pvt LtdvCC (2013 (297) ELT 297), held that the limitation period for filing refund claim in respect of SAD had to be calculated from the actual date of

payment of duty and not from the date of incorrect stamping by banks on TR-6 challans.

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In the issue Customs

Foreign trade policy (FTP)

Foreign trade policy

• The Central Government has permitted import of new motorcycles through Land Customs Stations (LCSs), Benapole/

Petrapole and LCS, Agartala across Indo-Bangladesh Border.

(Notification No. 46(RE-2013)/2009-14 dated 23 October, 2013)

• The Central Government has provided that export of prohibited items may be allowed under Advance Authorization subject to fulfillment of stipulated conditions. Further, the Board of Approval (BoA) can consider requests

• The Central Government has approved six new Pre-Shipment Inspection Agencies (PSIA) which, among other places, work in England, UAE, EU, USA and Singapore.

(Public Notice No. 34(RE-2013)/2009- 2014 dated 29 October, 2013 and Public Notice No. 39(RE-2013)/2009-2014 dated 26 November, 2013)

• The Central Government has prescribed the following procedure for closure of cases of default in export obligation under duty exemption schemes and EPCG scheme:

− An applicant paying custom duty and interest for regularising the case for export of a prohibited item from an

Export Oriented Unit (EOU).

(Notification No. 51(RE-2013)/2009-14 dated 14 November, 2013)

• The Central Government has issued a list of export products having a fall in export at industry level by more than 5% and has given an option to applicants for re- fixation of average export obligation in relation to Export Promotion Capital Goods (EPCG) authorizations issued during 2012-13, at a lower level considering this fall at industry level.

(Public Circular No. 07(RE-2013)/

2009-2014 dated 23 October, 2013)

interest for regularising the case should submit evidence in this regard to the concerned Regional Authority (RA), which will accordingly close the case and issue a closure letter.

− This closure letter will be submitted to adjudicating authority in case where matter is pending for adjudication or adjudicated, but appeal not filed. In case of appeal, the closure letter will be filed with appellate authority. On submission of letter, the appellate authority will finally decide on closure.

(Policy Circular No. 8(RE-2013)/2009- 14 dated 25 October, 2013)

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Foreign trade policy (FTP)

• The Central Government has clarified that deemed export drawback of central excise duty paid on inputs is not

admissible if facility of CENVAT credit has been availed. However, customs duty paid on such supplies can be refunded at the brand rate of duty.

(Policy Circular No. 9(RE-2013)/2009- 14 dated 30 October, 2013)

Case law

• In Haunt Sales CorporationvCC (2013- TIOL-1600-CESTAT-MAD), the Madras Tribunal held that re-export of goods is permissible even if a mis-declaration about origin of goods was made, provided goods were not prohibited.

final de-bonding.

• In Hindalco Industries LtdvCC (2013 (296) ELT 383), the Ahmedabad

Tribunal held that refund claim was not available in case the final assessment of Bill of Entry was not challenged.

• In Reliance Precitone Jewellers (P) Ltd vCC (2013 (297) ELT 71), the Delhi Tribunal held that benefit was available on re-import of goods actually exported without availing any export benefit, even where some export benefit was mentioned in shipping bill but not actually availed.

provided goods were not prohibited.

• The Mumbai Tribunal, in Stainloyz InternationalvCC 2013-TIOL-1660- CESTAT-MUM), held that imported goods could not be treated as used or hazardous solely on the basis of in-house reports of customs officers, each of which were at variance while there was expert evidence available to the contrary.

• In Ginni International LtdvCC (2013- TIOL-1570-CESTAT-DEL), the Delhi Tribunal held that the benefit available to DTA units became applicable to an EOU unit once it had discharged the duty obligation even before approval for

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Foreign trade policy (FTP) Anti-dumping duty Contacts

Anti-dumping duty Notifications

• The Central Government has imposed provisional anti-dumping duty on imports of Methylene Chloride falling under chapter 29 originating in, or exported from, the European Union, USA and Korea RP for a period of six months starting from 21 October, 2013.

(Customs (ADD) Notification No.

24/2013 dated 21 October, 2013)

• The Central Government has continued the levy of anti-dumping duty on imports of Paracetamol falling under Customs Tariff Heading (CTH) 2922.29.33, originating in, or exported from the People's Republic of China for a further

originating in, or exported from, the People’s Republic of China and Taiwan for a further period of one year till 30 October, 2014.

28/2013 dated 12 November, 2013)

• The Central Government has extended the levy of anti-dumping duty on imports of Phenol, falling under chapter 27 or 29, originating in, or exported from, South Africa for a further period of one year till 30 October, 2014.

29/2013 dated 12 November, 2013)

• The Central Government has extended the levy of anti-dumping duty on imports of ‘Vitamin A Palmitate’, falling under People's Republic of China for a further

period of five years from 28 October, 2013.

26/2013 dated 28 October, 2013)

• The Central Government has extended the levy of anti-dumping duty on Acrylic Fibre, falling under chapter 55,

originating in, or exported from, Korea RP and Thailand for a further period of one year till 19 November, 2014.

27/2013 dated 8 November, 2013)

• The Central Government has extended the levy of anti-dumping duty on imports of Cable Ties, falling under CTH 3926.90,

of ‘Vitamin A Palmitate’, falling under CTH 2936.21 originating in, or exported from, Switzerland and People’s Republic of China for a further period of five years from 13 November, 2013.

30/2013 dated 13 November, 2013)

• The Central Government has extended anti-dumping duty on imports on Diclofenac Sodium, falling under CTH 2942, originating in, or exported from, the People’s Republic of China for a further period of one year till 9 April, 2014.

31/2013 dated 13 November, 2013)

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Foreign trade policy (FTP) Anti-dumping duty Contacts

Contacts Delhi

Vivek Mishra/R Muralidharan Ph: +91 (124) 3306000 Mumbai

Dharmesh Panchal/S Satish Ph: +91 (22) 6689 1000 Kolkata

Rajarshi Dasgupta/Gopal Agarwal Ph: +91 (33) 2357 9100/4404 6000 Bangalore

Pramod Banthia

Ph: +91 (80) 4079 6000

Hyderabad Ananthanarayanan S Ph: +91 (40) 6624 6363 Chennai

Harisudhan M

Ph: +91 (44) 4228 5000 Pune

Nitin Vijaivergia Ph: +91 (20) 4100 4444 Ahmedabad

Dharmesh Panchal/Niren Shethia Ph: +91 (22) 6689 1000

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