CUSTOMS
Note: (a) “Customs Duty” means the customs duty levied under the Customs Act, 1962.
(b) “CVD” means the Additional Duty of Customs levied under sub-section (1) of section 3 of the Customs Tariff Act, 1975.
(c) “SAD” means the Special Additional Duty of Customs levied under sub-section (5) of section 3 of the Customs Tariff Act, 1975.
(d) “Export duty” means duty of customs leviable on goods specified in the Second Schedule to the Customs Tariff Act, 1975.
(e) Clause nos. in square brackets [ ] indicate the relevant clause of the Finance Bill, 2013.
Amendments carried out through the Finance Bill, 2013 come into effect on the date of its enactment unless otherwise specified.
AMENDMENTS IN THE CUSTOMS ACT, 1962:
1) Clause (n) of sub-section (2) of section 11 is being amended to include “designs and geographical indications” so as to provide for protection of these rights. [Clause 54]
2) Section 27 is being amended to provide that if the amount of refund claimed is less than rupees hundred, the same shall not be refunded. [Clause 55]
3) Section 28 is being amended to provide that show cause notice will not be served where the amount demanded is less than rupees one hundred. [Clause 56]
4) Section 28BA is being amended to provide for provisional attachment of property belonging to any person to whom notice under sub-section (4) of section 28 has been served. [Clause 57]
5) Clause (a) of section 28E is being substituted so as to include any new business of import or export proposed to be undertaken by the existing importer or exporter within the meaning of “activity”. [Clause 58]
6) Section 29 is being amended to empower the Board to permit landing of vessels and aircrafts at any place other than customs port or customs airport. [Clause 59]
7) Section 30 is being amended to provide for electronic filing of import manifest and also to provide that the Commissioner of Customs may, in cases where it is not feasible to deliver the import manifest by presenting electronically, allow the same to be delivered in any other manner. [Clause 60]
8) Section 41 is being amended to provide for electronic filing of export manifest and also to provide that the Commissioner of Customs may, in cases where it is not feasible to deliver the export manifest by presenting electronically, allow the same to be delivered in any other manner. [Clause 61]
9) Sub-section (2) of section 47 is being amended to reduce the interest free period for payment of import duty from five days to two days. [Clause 62]
10) Section 49 is being amended to restrict the period of storage of imported goods, pending clearance, in a public or private warehouse to thirty days and to provide that the Commissioner of Customs may extend the period of storage for further period not exceeding thirty days at a time. [Clause 63]
11) Section 69 is being substituted to provide that any warehoused goods may be exported to a place outside India without payment of import duty if a shipping bill or a bill of export in prescribed form or label or declaration accompanying the goods as referred to in section 82 has been presented in respect of such goods. [Clause 64]
12) Under the existing sub-section (6) of section 104, all offences under the Act are bailable. Sub-section (6) is being substituted with sub-section (6) and (7). Sub-section (6) provides that the following specified offences punishable under section 135 shall be non-bailable, namely:-
(a) evasion or attempted evasion of duty exceeding Rs.50 lakh;
(b) prohibited goods notified under section 11 which are also notified under sub-clause (C) of clause (i) of sub-section (1) of section 135;
(c) import or export of any goods which have not been declared in accordance with the provisions of this Act and the market price of which exceeds Rs. 1 crore;
(d) Fraudulently availing of or attempt to avail of drawback or any exemption from duty provided under this Act, if the amount of drawback or exemption from duty exceeds Rs.50 lakh.
Sub-section (7) provides that all other offences except those specified in sub-section (6) shall be bailable. [Clause 65]
13) A proviso is being inserted in sub-section (2A) of section 129B to provide that in cases where the delay in disposing of the appeal is not attributable to the appellant, the Tribunal may extend the period of stay by a period not exceeding 185 days subject to the condition that if the appeal is not disposed of within the total period of 365 days from the date of order, the stay order shall stand vacated. [Clause 66]
14) Section 129C is being amended to enhance the monetary limit of the Single Bench of the Tribunal to hear and dispose of appeals from Rs.10 lakh to Rs.50 lakh. [Clause 67]
15) In sub-clauses (B) and (D) of clause (i) of section 135(1), the threshold limit for punishment in an offence relating to evasion or attempted evasion of duty or fraudulently availing of or attempting to avail of drawback or any exemption from duty in connection with export of goods, has been increased from Rs.30 lakh to Rs.50 lakh. [Clause 68]
16) A new clause (d) is being inserted in section 142 to provide (i) for recovery of money due to the Central Government from any other person other than the defaulter after giving such other person a notice in writing, (ii) that the person to whom such notice has been issued shall be bound to comply, and (iii) that if the person to whom the notice is issued fails to comply, he shall be deemed to be a defaulter in respect of the amount specified in the notice. [Clause 69]
17) Section 143A is being omitted. [Clause 70]
18) Sub-section (3) of section 144 is being amended to remove the duty liability on any sample of goods which is consumed or destroyed during the course of testing or examination. [Clause 71]
19) Section 146 is being substituted to change the nomenclature of “customs house agents” to “customs brokers” considering the global practice and internationally accepted nomenclature. [Clause 72]
20) Section 146A is being amended so as to:
(a) substitute the phrase “customs house agent” with the phrase “customs broker”;
(b) include any offence committed under the Finance Act, 1994 as a disqualification for person to act as an authorized representative in customs matters. [Clause 73]
21) Sub-section (3) of section 147 is being amended to expand the scope of the liability of agents of the owner, importer or exporter of any goods. [Clause 74]
22) Full exemption from export duty is being given retrospectively on flat rolled products of iron or non-alloy steel, plated or coated with zinc falling under headings 7210 and 7212 vide notification No. 27/2011-Customs, dated 01 .03.2011 from 01.03.2011. [Clause 75]
AMENDMENTS IN THE SCHEDULES TO THE CUSTOMS TARIFF ACT, 1975:
1) The First Schedule is being amended to:
(a) change the present description of tariff item 03022400 and 03033400 to “Turbots (Psetta maxima)”
(b) omit the tariff item 1517 90 20 (Peanut butter).
(c) insert Supplementary Note in Chapter 48.
(d) enhance the tariff rate against items under heading 8703 from 100% to 125%.
(e) enhance the tariff rate against items under heading 8903 from 10% to 25%. [Clause 76]
2) The Second Schedule is being amended as follows:
(a) to substitute the entry in column (2) against Sl. No. 43, with the entry “7210, 7212”, retrospectively with effect from 01 .03.2011.
(b) Entry 9A is being inserted to prescribe a tariff rate of export duty of 20% on raw sugar, white or refined sugar under heading 1701. However, no export duty is proposed to be levied presently.
(c) Entries 23A and 23B are being inserted to prescribe a tariff rate of export duty of 30% on Bauxite (natural), not calcined and Bauxite (natural), calcined under heading tariff items 26060010 and 26060020 respectively. Effective rate is being prescribed at 10%
(d) Entries 24A and 24B are being inserted to prescribe a tariff rate of export duty of 30% on Ilmenite, unprocessed and Ilmenite, upgraded (beneficiated Ilmenite including Ilmenite ground) under heading tariff items 26140010 and 26140020 respectively. Effective rate is being prescribed on unprocessed Ilmenite at 10% and on upgraded Ilminite at 5%.
The changes at para 1) and 2) (b), (c), (d) will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. [Clause 77]
CUSTOMS
A. General
1) Baggage Rules are being amended to,-
(i) raise the duty free allowance in respect of jewellery for an Indian passenger who has been residing abroad for over one year or a person who is transferring his residence to India from Rs.10,000 to Rs.50,000 in case of a gentleman passenger and from Rs.20,000 to Rs.1 ,00,000 in case of a lady passenger.
(ii) raise the duty free allowance for crew member of vessel/aircraft from Rs.600 to Rs.1500.
B. Proposals involving changes in rates of duty
I. AGRICULTURE/AGRO PROCESSING/PLANTATION SECTOR:
1) Basic customs duty on dehulled oat grain is being reduced from 30% to 15%.
2) Basic customs duty on hazel nuts is being reduced from 30% to 10%. 3) Export duty of 10% on de-oiled rice bran oil cake is being withdrawn.
II. AUTOMOBILES:
1) Basic customs duty on new passenger cars and other motor vehicles (high end cars) with CIF value more than US$ 40,000 and/or engine capacity exceeding 3000cc for petrol run vehicles and exceeding 2500 cc for diesel run vehicles is being increased from 75% to 100%.
2) Basic customs duty on motor cycle with engine capacity of 800cc or more is being increased from 60% to 75%.
III. METALS:
1) Export duty is being levied on ilmenite unprocessed at 10% and on ilmenite, upgraded at 5%.
2) Export duty is being levied on bauxite at 10%.
3) Basic customs duty is being reduced from 10% to 5% on stainless steel wire cloth stripe and from 7.5% to 5% on wash coat for use in the manufacture of catalytic convertors and their parts.
4) Full exemption from export duty is being provided to galvanized steel sheets falling under certain sub-headings, retrospectively w.e.f. 01.03.2011.
IV. PRECIOUS METALS:
1) Basic customs duty is being reduced from 10% to 2% on pre-forms of precious and semi-precious stones.
V. CAPITAL GOODS/INFRASTRUCTURE:
1) Basic customs duty on steam coal is being increased from Nil to 2% and CVD from 1% to 2%.
2) Basic customs duty on bituminous coal is being reduced from 5% to 2% and CVD from 6% to 2%.
3) Basic customs duty is being reduced from 7.5% to 5% on 20 specified machinery for use in leather and footwear industry.
VI. AIRCRAFTS & SHIPS:
1) Basic Customs Duty on yachts and motor boats is being increased from 10% to 25%.
2) Time limit for consumption of imported goods by ship repair units is being extended from 3 months to 1 year.
3) Time period for consumption/installation of parts and testing equipments imported for maintenance, repair and overhaul (MRO) of aircrafts by units engaged in such activities is being extended from 3 months to 1 year.
4) Presently, the basic customs duty exemption is available to parts and testing equipments for maintenance, repair and overhaul of aircrafts. This exemption is now being extended to parts and testing equipments for maintenance, repair and overhaul of aircrafts and parts thereof.
VII. ENVIRONMENT PROTECTION:
1) Full exemption from basic customs duty is being provided to lithium ion automotive battery for manufacture of lithium ion battery packs for supply to the manufacturers of hybrid and electric vehicles.
2) Time period of exemption (Nil BCD, CVD of 6% and Nil SAD) for the specified parts of electric and hybrid vehicles is being extended by 2 more years up to 31st March, 2015.
VIII. TEXTILES:
1) Basic customs duty on raw silk (not thrown), of all grades is being increased from 5% to 15%.
2) Basic customs duty is being reduced from 7.5% to 5% on textile machinery & parts.
IX. ELECTRONICS/HARDWARE:
1) Basic customs duty on Set Top Boxes for TV is being increased from 5% to 10%.
X. MISCELLANEOUS:
1) Full exemption from basic customs duty and additional customs duty is being provided to trophy imported by National Sports Federation recognized by the Department of Sports and Youth Affairs or any Sports Body registered under Societies Registration Act, in connection with any international tournament held in India.
2) Withdrawal of exemption from education cess and secondary & higher education cess on aircraft and aircraft parts, soyabean oil, olive oil etc.
