Article contains Clause wise Amendments in the Customs Act, 1962 vide Finance (No.2) Bill, 2019 and Other Proposals Involving Changes In Basic Customs Duty Rates,  Clarificatory Amendments In Respective Rate Notifications, Effective change in rate of Road and Infrastructure Cess on Petrol and Diesel, Amendment In The Sixth Schedule To Finance Act, 2018 and Other Miscellaneous changes.

I. Clause wise Amendments in the Customs Act, 1962 vide Finance (No.2) Bill, 2019

1. Section 41 is being amended so as to provide a facility, that the departure manifest can also be furnished to a person notified by the Central Government, in addition to the person-in- charge of the conveyance. (Clause 69)

2. A new chapter XIIB titled “Verification of Identity and Compliance” is being inserted. New section 99B introduced under this chapter empowers proper officer of Customs to carry out verification of a person for ascertaining compliance with the provision of the Customs Act or any other law for the time being in force, for protecting the interests of revenue or to prevent smuggling in the manner as may be prescribed. It is proposed to do the verification of the person through the Aadhaar number or through such other alternative and viable means of identification as may be prescribed through the regulations. It also empowers the Board inter-alia to make regulations to exempt such persons or class of persons who may not be required to undergo the said verification. Failure to comply with the specified provisions of this section may result in suspension or denial of certain benefits. (Clause 70)

Budget 2019 Amends Customs Tariff Act, 1975 & First Schedule

3. Section 103 is being amended so as to-

(a) substitute sub-section (1) in order to enable the proper officer to scan or screen, with the prior approval of Deputy Commissioner of Customs or Assistant Commissioner of Customs, any person referred to in sub-section (2) of section 100 who has any goods liable to confiscation secreted inside his body. The proper officer can directly furnish the report of the said screening or scanning to the nearest magistrate if such goods are found secreted inside the body of the said person.

(b) so as to enable the magistrate to take action upon the report of scanning or screening by the proper officer under sub-section (6).

(Clause 71)

4. Section 104 is being amended so as to-

(a) empower an officer of customs to arrest a person who has committed an offence outside India or Indian Customs waters also under sub-section (1).

(b) insert two new clauses (c) and (d) in sub-section (4) so as to specify two particular offences which shall be cognizable.

(c) insert a new clause (e) in sub-section (6) so as to specify a particular offence which shall be non-bailable.

(d) insert an Explanation so as to define the term instrument.

(Clause 72)

5. Section 110 is being amended so as to-

(a) substitute the existing proviso in sub-section (1) with two provisos so as to specify the conditions under which the custody of seized goods could be given to certain person. The amendment also seeks to specify the conditions, under which the custody of such goods, where it is not practicable to seize such goods, could be given to certain persons.

(b) insert a new sub-section (5) so as to empower the proper officer to provisionally attach any bank account for safeguarding the government revenue and prevention of smuggling, for a period not exceeding six months. It is also being provided that a Principal Commissioner of Customs or Commissioner of Customs may further extend the period of attachment up to six months.

(Clause 73)

6. Section 110A is being amended so as to empower an adjudicating authority to release bank account provisionally attached under section 110 to the account holder on fullfilment of certain conditions. (Clause 74)

7. A new section 114AB is being inserted so as to provide that any person who has obtained any instrument by fraud, collusion, wilful misstatement or suppression of facts and such instrument has been utilized by such person or any other person for discharging duty, such person to whom the instrument was issued shall be liable for penalty not exceeding the face value of such instrument. An Explanation to define the term instrument is also being inserted. (Clause 75)

8. Section 117 is being amended so as to increase the maximum limit of penalty from one lakh rupees to four lakh rupees. (Clause 76)

9. First proviso to section 125 is being amended so as to provide that in respect of cases of covered under deemed closure proceedings under section 28, no fine in lieu of confiscation shall be imposed on the infringing goods. (Clause 77)

10. Sub-section (1) of section 135 is being amended so as to-

(a) to insert a new clause (e) therein to make obtaining of an instrument from any authority by fraud, collusion, willful misstatement or suppression of facts, where such instrument has been utilized by any person a punishable offence.

(b) insert a new sub-item (E) under item (i) to make obtaining an instrument from any authority by fraud, collusion, wilful misstatement or suppression of facts, where such instrument has been utilized by any person a punishable offence if the duty relatable to utilization of the instrument exceeds fifty lakhs of rupees.

(c) insert an Explanation to define the term instrument.

(Clause 78)

11. Section 149 is being amended so as to empower Board to make regulations specifying time, form, manner, restrictions and conditions for amendment of any document. (Clause 79)

12. Section 157 is being amended so as to empower the Board to make regulations for purposes of sections 99B and 149 respectively. (Clause 80)

13. Sub-section (2) of section 158 is being amended so as to increase the maximum limit of penalty for violation of any provision of rules or regulations from fifty thousand rupees to two lakh rupees. (Clause 81)

Extract of Clause 69, 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80 and 81 of Finance Bill 2019

69. Amendment of section 41.

In section 41 of the Customs Act, 1962 (hereinafter referred to as the Customs Act), in sub-section (1), for the portion beginning with the words “The person-in-charge of a conveyance”, and ending with the words “not exceeding fifty thousand rupees”, the following shall be substituted, namely:—

“The person-in-charge of a conveyance carrying export goods or imported goods or any other person as may be specified by the Central Government, by notification, shall, before departure of the conveyance from a customs station, deliver to the proper officer in the case of a vessel or aircraft, a departure manifest or an export manifest by presenting electronically, and in the case of 10 a vehicle, an export report, in such form and manner as may be prescribed and in case, such person-in-charge or other person fails to deliver the departure manifest or export manifest or the export report or any part thereof within such time, and the proper officer is satisfied that there is no sufficient cause for such delay, such person-in-charge or other person shall be liable to pay penalty not exceeding fifty thousand rupees”.

70. Insertion of New Chapter XIIB.

After Chapter XIIA of the Customs Act, the following Chapter shall be inserted, namely:––

‘CHAPTER XIIB

VERIFICATION OF IDENTITY AND COMPLIANCE

Verification of identity and compliance there of.

99B. (1) The proper officer, authorised in this behalf by the Principal Commissioner of Customs or the Commissioner of Customs, as the case may be, may, for the purposes of ascertaining 20 compliance of the provisions of this Act or any other law for the time being in force, require a person, whose verification he considers necessary for protecting the interest of revenue or for preventing smuggling, to do all or any of the following, namely:––

(a) undergo authentication, or furnish proof of possession of Aadhaar number, in such manner and within such time as may be prescribed;

(b) submit such other document or information, in such manner and within such time as may be prescribed:

Provided that where such person has not been assigned the Aadhaar number, or where so assigned, but authentication of such person has failed due to technical reasons or for reasons beyond his control, then, he shall be provided an opportunity to furnish such other alternative and 30 viable means of identification in such form and manner and within such time as may be prescribed.

(2) The provisions of sub-section (1) shall not apply to such person or class of persons as may be prescribed.

(3) Notwithstanding anything contained in any other provisions of this Act, where the Principal Commissioner of Customs or the Commissioner of Customs comes to the conclusion, based on 35 reasons to be recorded in writing, that the person referred to in sub-section (1) has––

(i) failed to comply with the requirements of the said sub-section or submitted incorrect documents or information under the said sub-section, he may, by order, suspend––

(a) clearance of imported goods or export goods;

(b) sanction of refund;

(c) sanction of drawback;

(d) exemption from duty;

(e) licence or registration granted under this Act; or

(f) any benefit, monetary or otherwise, arising out of import or export, relating to such person, subject to such conditions as may be prescribed;

(ii) failed authentication as required under the said sub-section, he may, by order, direct that such person shall not have the benefit of any of the items specified in sub-clauses (a) to (f) of clause (i).

(4) The order of suspension under sub-section (3) shall remain in force until the person concerned complies with the requirements of sub-section (1) or furnishes correct document or information there under.

Explanation.– For the purposes of this section, the expression “Aadhaar number” shall have the same meaning as assigned to it in clause (a) of section 2 of the Aadhaar (Targeted Delivery of Financial 18 of 2016. and Other Subsidies, Benefits and Services) Act, 2016.’.

71. Amendment of section 103.22 of 1992.22 of 1992.Amendment of section 110.50

In section 103 of the Customs Act, ––

(i) for sub-section (1), the following sub-section shall be substituted, namely:–

“(1) Where the proper officer has reason to believe that any person referred to in sub-section (2) of section 100 has any goods liable to confiscation secreted inside his body, he may detain such person and shall,––

(a) with the prior approval of the Deputy Commissioner of Customs or Assistant Commissioner 10 of Customs, as soon as practicable, screen or scan such person using such equipment as may be available at the customs station, but without prejudice to any of the rights available to such person under any other law for the time being in force, including his consent for such screening or scanning, and forward a report of such screening or scanning to the nearest magistrate if such goods appear to be secreted inside his body; or

(b) produce him without unnecessary delay before the nearest magistrate.”;

(ii) in sub-section (6), after the words “Where on receipt of a report”, the words, brackets, letter and figure “from the proper officer under clause (a) of sub-section (1) or” shall be inserted.

72. Amendment of section 104.

In section 104 of the Customs Act, ––

(i) in sub-section (1), the words “in India or within the Indian customs waters” shall be omitted;

(ii) in sub-section (4),––

(A) in clause (b), for the word “rupees,”, the words “rupees; or” shall be substituted;

(B) after clause (b), the following clauses shall be inserted, namely:—

“(c) fraudulently availing of or attempting to avail drawback or any exemption from duty provided under this Act, where the amount of drawback or exemption from duty exceeds fifty 25 lakh rupees; or

(d) fraudulently obtaining an instrument for the purposes of this Act or the Foreign Trade (Development and Regulation) Act, 1992, and such instrument is utilised under this Act, where duty relatable to such utilisation of instrument exceeds fifty lakh rupees,”;

(iii) in sub-section (6),––

(A) in clause (d), for the word “rupees,”, the words “rupees; or” shall be substituted;

(B) after clause (d), the following clause shall be inserted, namely:—

“(e) fraudulently obtaining an instrument for the purposes of this Act or the Foreign Trade (Development and Regulation) Act, 1992, and such instrument is utilised under this Act, where duty relatable to such utilisation of instrument exceeds fifty lakh rupees,”;

(iv) after sub-section (7), the following Explanation shall be inserted, namely:––

Explanation.––For the purposes of this section, the expression “instrument” shall have the same meaning as assigned to it in Explanation 1 to section 28AAA.’.

73. Amendment of section 110.

In section 110 of the Customs Act, ––

(i) in sub-section (1), for the proviso, the following provisos shall be substituted, namely:—

“Provided that where it is not practicable to remove, transport, store or take physical possession of the seized goods for any reason, the proper officer may give custody of the seized goods to the owner of the goods or the beneficial owner or any person holding himself out to be the importer, or any other person from whose custody such goods have been seized, on execution of an undertaking by such person that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer:

Provided further that where it is not practicable to seize any such goods, the proper officer may serve an order on the owner of the goods or the beneficial owner or any person holding himself out to be importer, or any other person from whose custody such goods have been found, directing that such person shall not remove, part with, or otherwise deal with such goods except with the previous permission of such officer.”;

(ii) after sub-section (4), the following sub-section shall be inserted, namely:—

“(5) Where the proper officer, during any proceedings under the Act, is of the opinion that for the purposes of protecting the interest of revenue or preventing smuggling, it is necessary so to do, he may, with the approval of the Principal Commissioner of Customs or Commissioner of Customs, by order in writing, provisionally attach any bank account for a period not exceeding six months:

Provided that the Principal Commissioner of Customs or Commissioner of Customs may, for reasons to be recorded in writing, extend such period to a further period not exceeding six months and inform such extension of time to the person whose bank account is provisionally attached, before the expiry of the period so specified.”.

74. Amendment of section 110 A.

In section 110A of the Customs Act,—

(i) in the marginal heading, after the words ‘‘things seized”, the words ‘‘or bank account provisionally attached” shall be inserted;

(ii) after the words “documents or things seized”, the words “or bank account provisionally attached” shall be inserted;

(iii) after the words ‘‘to the owner”, the words ‘‘or the bank account holder” shall be inserted.

75. Insertion of new section 114 AB.Penalty for obtaining instrument by fraud, etc.

After section 114AA of the Customs Act, the following section shall be inserted, namely:––

‘114AB. Where any person has obtained any instrument by fraud, collusion, wilful misstatement or suppression of facts and such instrument has been utilised by such person or any other person for discharging duty, the person to whom the instrument was issued shall be liable for penalty not exceeding the face value of such instrument.

Explanation.–– For the purposes of this section, the expression “instrument” shall have the same meaning as assigned to it in the Explanation 1 to section 28AAA.’.

76. Amendment of section 117.

In section 117 of the Customs Act, for the words “one lakh rupees”, the words “four lakh rupees” shall be substituted.

77. Amendment of section 125.

In section 125 of the Customs Act, in sub-section (1), in the first proviso, for the words “the 25 provisions of this section shall not apply”, the words “no such fine shall be imposed” shall be substituted.

78. Amendment of section 135.

In section 135 of the Customs Act,––

(i) in sub-section (1),—

(a) in clause (d), for the words ‘‘export of goods,”, the words ‘‘export of goods; or’’ shall be

(b) after clause (d), the following clause shall be inserted, namely:—

“(e) obtains an instrument from any authority by fraud, collusion, wilful misstatement or suppression of facts and such instrument has been utilised by such person or any other person,”;

(c) in item (i),—

(I) in sub-item (D), for the words ‘‘of rupees,”, the words ‘‘of rupees; or’’ shall be substituted;

(II) after sub-item (D), the following sub-item shall be inserted, namely:—

“(E) obtaining an instrument from any authority by fraud, collusion, wilful misstatement or suppression of facts and such instrument has been utilised by any person, where the duty relatable to utilisation of the instrument exceeds fifty lakh rupees,”.

(ii) after sub-section (3), the following Explanation shall be inserted, namely:––

‘Explanation.–– For the purposes of this section, the expression “instrument” shall have the same meaning as assigned to it in the Explanation 1 to section 28AAA.’.

79. Amendment of section 149.

In section 149 of the Customs Act, after the words “custom house to be amended”, the words “in such form and manner, within such time, subject to such restrictions and conditions, as may be prescribed” shall be inserted.

80. Amendment of section 157.

In section 157 of the Customs Act, in sub-section (2),––

(i) after clause (k), the following clause shall be inserted, namely:––

“(ka) the manner of authentication and the time limit for such authentication, the document or information to be furnished and the manner of submitting such document or information and the time limit for such submission, the form and the manner of furnishing alternative means of identification and the time limit for furnishing such identification, person or class of persons to be exempted and conditions subject to which suspension may be made, under Chapter XIIB;”;

(ii) after clause (m), the following clause shall be inserted, namely:––

“(n) the form and manner, the time limit and the restrictions and conditions for amendment of any document under section 149.”.

81. Amendment of section 158.

In section 158 of the Customs Act, in sub-section (2), in clause (ii), for the words “fifty thousand rupees”, the words “two lakh rupees” shall be substituted.

Note on Clause 69, 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80 and 81 of Finance Bill 2019

Clause 69 of the Bill seeks to amend sub-section (1) of section 41 of the Customs Act so as to provide that the facility to furnish departure manifest shall, in addition to the person-in-charge of the conveyance, also be given to other person notified by the Central Government.

Clause 70 of the Bill seeks to insert a new chapter XIIB relating to verification of identity and compliance in the Customs Act. The proposed new section 99B under that clause seeks to empower proper officer of customs to carry out verification of a person for ascertaining compliance with the provision of the Customs Act or any other law for the time being in force, for protecting the interests of revenue or to prevent smuggling in the manner as may be prescribed. It is proposed to verify identity of a person through Aadhaar number or through any other alternative and viable means of identification. The section also specifies circumstances under which benefit of certain items shall be suspended or denied to such person. It also empowers the Board to make regulations for the purposes of the section.

Clause 71 of the Bill seeks to substitute sub-section (1) and to amend sub-section (6) of section 103 of the Customs Act. The proposed amendment to sub-section (1) seeks to enable the proper officer to scan or screen with prior approval of Deputy Commissioner of Customs or Assistant Commissioner of Customs any person referred to in sub-section (2) of section 100 who has any goods liable to confiscation secreted inside his body. The proposed amendment to sub-section (6) seeks to enable the magistrate to take action upon the report of scanning or screening by the proper officer also.

Clause 72 of the Bill seeks to amend sub-sections (1), (4) and (6) of section 104 of the Customs Act.

The amendment to sub-section (1) seeks to empower an officer of customs to arrest a person who has committed an offence outside India or Indian Customs waters.

The amendment to sub-section (4) seeks to insert two new clauses (c) and (d) therein, to provide for certain offences which shall be cognizable.

The amendment to sub-section (6) seeks to insert a new clause (e) therein, to provide for an offence which shall be non-bailable.

It is also proposed to insert an Explanation to define the term “instrument”.

Clause 73 of the Bill seeks to amend sub-section (1) of section 110 of the Customs Act so as to substitute the existing proviso with two provisos so as to specify the conditions under which the custody of seized goods could be given to certain person. The amendment also seeks to specify the conditions, under which the custody of such goods, where it is not practicable to seize such goods, could be given to certain persons.

It is proposed to insert a new sub-section (5) so as to empower the proper officer to provisionally attach any bank account for safeguarding the Government revenue and prevention of smuggling, for a period not exceeding six months. It is also proposed that Principal Commissioner of Customs or Commissioner of Customs may, for reasons to be recorded in writing, extend the period of provisional attachment of a bank account to a further period not exceeding six months and inform the person whose bank account is provisionally attached before the expiry of the period so specified.

Clause 74 of the Bill seeks to amend section 110A of the Customs Act so as to empower an adjudicating authority to release bank account provisionally attached under section 110 to the bank account holder on fulfilment of certain conditions.

Clause 75 of the Bill seeks to insert a new section 114AB in the Customs Act. The proposed section seeks to provide that any person who has obtained any instrument by fraud, collusion, wilful misstatement or suppression of facts and such instrument has been utilised by such person or any other person for discharging duty, such person to whom the instrument was issued shall be liable for penalty not exceeding the face value of such instrument. It is also proposed to insert an Explanation to define the term “instrument”.

Clause 76 of the Bill seeks to amend section 117 of the Customs Act so as to increase the maximum limit of penalty from one lakh rupees to four lakh rupees.

Clause 77 of the Bill seeks to amend first proviso to section 125 of the Customs Act so as to provide that the no fine in lieu of confiscation shall be imposed in respect of cases of deemed closure under section 28.

Clause 78 of the Bill seeks to amend sub-section (1) of section 135 of the Customs Act so as to insert a new clause (e) therein to make obtaining of an instrument by any person from any authority by fraud, collusion, wilful misstatement or suppression of facts, where such instrument has been utilised by such person or any other person a punishable offence.

The new clause (E) in item (i) of sub-section (1) seeks to make obtaining an instrument from any authority by fraud, collusion, wilful misstatement or suppression of facts, where such instrument has been utilised by any person a punishable offence if the duty relatable to utilisation of the instrument exceeds fifty lakhs of rupees.

It is also proposed to insert an Explanation to define the term “instrument”.

Clause 79 of the Bill seeks to amend section 149 of the Customs Act so as to empower Board to make regulations specifying time, form, manner, restrictions and conditions for amendment of any document.

Clause 80 of the Bill seeks to amend section 157 of the Customs Act. The proposed amendment seeks to empower the Board to make regulations under proposed new section 99B and section 149 of the Customs Act.

Clause 81 of the Bill seeks to amend sub-section (2) of section 158 of the Customs Act so as to increase the maximum limit of penalty for violation of any provisions of rules or regulations made under Customs Act from fifty thousand rupees to two lakh rupees.

II. Other Proposals Involving Changes in Basic Customs Duty Rates

S.
No
Heading,
sub-heading
tariff item
Commodity From To
Defence  

 

1 Any Chapter Specified Defence equipment and their parts imported by the Ministry of Defence or the Armed Forces Applicable
rate
Nil

 

Medical Devices  

 

2 Any Chapter Raw material, parts or accessories for use manufacture of artificial kidneys, disposable sterilized dialyzer and micro-barrier of artificial kidney Applicable
rate
Nil

 

Food processing  

 

3 0801 32 10 Cashew kernel broken Rs 60/ Kg or 45%, whichever is higher 70%

 

4 0801 32 20,

0801 32 90

Cashew kernel whole, Cashew nuts shelled, others Rs 75/ Kg or 45%, whichever is higher 70%

 

Nuclear Fuels and Nuclear Energy projects
5 2612 10 00 All forms of Uranium ores and Concentrates for generation of nuclear power (Uranium concentrate U3O8 already exempt) 2.5% Nil
6 2844 20 00 All goods for use in generation of Nuclear power (Certain goods such as sintered natural uranium dioxide already exempt) 7.5% Nil
7 9801 All goods required for setting up of the following power projects under project imports: –

a) Mahi Banswara Atomic Power project- 1 to 4, Mahi
Banswara site Rajasthan

b) Kaiga Atomic Power project – 5 & 6, Kaiga site, Karnataka

c) Gorakhpur Atomic Power project- 3 & 4, GHAVP, Haryana

d) Chutka Atomic Power project- 1 & 2, Chutka site, Madhya Pradesh

Applicable
rate
Nil
Oils and associated chemicals
8 Chapter 15,

2915 70,

3823 11 00,

3823 12 00,

3823 13 00,

3823 19 00

Palm stearin and other oils, having 20% or more free fatty acid, Palm Fatty Acid Distillate and other industrial monocarboxylic fatty acids, acid oils from refining, for use in manufacture of soap and oleochemicals. Nil 7.5%
Petroleum and Petrochemicals
9 2709 00 00 Petroleum Crude Nil Re. 1 per
tonne
10 2710 Naphtha 5% 4 %
11 2903 15 00 Ethylene dichloride (EDC) 2% Nil
12 2910 20 00 Methyloxirane (Propylene Oxide) 7.5% 5%
13 Plastic and Rubber
14 3904 Poly Vinyl Chloride 7.5% 10%
15 3926 90 91,

3926 90 99

Articles of plastics 10% 15%
16 4002 31 00 All goods i.e. Butyl Rubber 5% 10%
17 4002 39 00 Chlorobutyl rubber or bromobutyl rubber 5% 10%
Paper and Paper products
18 48 a. Newsprint

b. Uncoated paper used for printing of newspapers

c. Lightweight coated paper used for printing of magazines

Nil 10%
19 4901 10 10,

4901 91 00,

4901 99 00

Printed books (including covers for printed books) and printed manuals, in bound form or in loose-leaf form with binder, executed on paper or any other material including transparencies. Nil 5%
Textiles
20 5101 Wool Fibre 5% 2.5%
21 5105 Wool Tops 5% 2.5%
Flooring materials
22 2515 12 20,

6802 10 00,

6802 21 10,

6802 21 20,

6802 21 90,

6802 91 00,

6802 92 00

Marble Slabs 20% 40%
Inputs for Optical Fibres
23 28 or 70 Raw materials used in manufacture of Preform of Silica:-

(i) Refrigerated Helium Liquid (2804 29 10)

(ii) Silicon Tetra Chloride and Germanium Tetra Chloride (2812 19 20, 2812)

(iii) Silica Rods (7002 20 90)

(iv) Silica Tube (7002 31 00)

Applicable
Rate
Nil
24 5603 94 00 Water blocking tapes for manufacture of optical fiber cable Nil 20%
Precious Metals
25 7106 Silver dore bar, having silver content not exceeding 95% 8.5% 11%
26 7108 Gold dore bar, having gold content not exceeding 95% 9.35% 11.85%
27 71 or 98 (a) Gold (excluding ornaments studded with stones or pearls) imported by an eligible passenger as baggage

(b) Silver (excluding ornaments studded with stones or pearls) imported by an eligible passenger as baggage

10% 12.5%
Iron and Steel, Other base metals
28 7218 Stainless steel in ingots or other primary forms; semi-finished products of stainless less 5% 7.5%
29 7224 Other alloy steel in ingots or other primary forms; semi-finished products of other alloy steel 5% 7.5%
30 7225,

7225 19 90

Inputs for the manufacture of CRGO steel:-

a) MgO coated cold rolled steel coils

b) Hot rolled coils

c) Cold-rolled MgO coated and annealed steel

d) Hot rolled annealed and pickled coils

e) Cold rolled full hard

5% 2.5%
31 7226 99 30 Amorphous alloy ribbon 10% 5%
32 7229 Wire of other alloy steel (other than INVAR) 5% 7.5%
33 8105 20 10 Cobalt mattes and other intermediate products of cobalt metallurgy 5% 2.5%
Capital goods
34 8474 20 10 Stone crushing (cone type) plants for the construction of roads Nil 7.5%
35 82, 84, 85 or 90 Capital goods used for manufacturing of following electronic items, namely-

(i) Populated PCBA

(ii) Camera module of cellular mobile phones

(iii) Charger/Adapter of cellular mobile phone

(iv) Lithium Ion Cell

(v) Display Module

(vi) Set Top Box

(vii) Compact Camera Module

Applicable
rate
Nil
36 84, 85 or 90 Capital goods used for manufacturing of specified electronic items, namely-

(i) Cathode Ray tubes;

(ii) CD/CD-R/DVD/DVD-R;

(viii) Deflection components, CRT monitors/CTVs;

(ix) Plasma Display Panel

Nil Applicable
Electronics
37 8504 40 Charger/Power adapter for CCTV camera/IP camera/DVR/NVR Nil 15%
38 85 Specified electronic items like plugs, sockets, switches, connectors, relays. Nil Applicable
rate
Automobile and automobile parts
39 8421 39 20,

8421 39 90

Catalytic convertor (All goods under these tariff items other than catalytic converters will continue at 7.5%) 5% 10%
40 8702, 8704 Completely Built Unit (CBU) of vehicles falling under heading 8702, 8704 25% 30%
41 Any Chapter Following parts of electric vehicles: –

(i) E-Drive assembly,

(ii) On board charger,

(x) E-compressor and

(xi) Charging Gun

Applicable
rate
Nil
42 87 Prescribing actual user condition in respect of existing exemption from BCD to parts of Hybrid vehicles
Oil rigs and other goods used for oil exploration
43 84 or any
other chapter
Providing option to pay BCD at transaction value on the disposal of goods, imported without payment of customs duty for petroleum operations / coal bed Methane operations where such disposal is made in unserviceable and mutilated condition Applicable rate on
depreciated value
7.5% on
transaction
value
Export Promotion for Sports goods
44 39 , 4407 Foam/EVA foam (39) and Pine Wood (4407) are being included in the list of items allowed duty free import upto 3% of FOB value of sports goods exported in the preceding financial year subject to specified conditions Applicable
rate
Nil
Clarifications and Miscellaneous changes regarding Basic Customs Duty
Fisheries
45 2309 Clarification is being issue that prawn feed and shrimp larvae feed, other than in pellet form will also attract 5% customs duty applicable on other fish feed in pellet form.

III. Retrospective Amendments Of Rate Notifications

S.
No.
Amendment Clause of the
Finance (No. 2)
Bill, 2019
1 (i) Notification Nos. 46/2011-Customs, dated 01.06.2011, 53/2011-Customs, dated 01.07.2011, 12/2012-Customs dated 17.03.2012 are proposed to be amended retrospectively to insert correct CTH of Stearic Acid in the notifications with effect from 31.03.2017.(ii) Notification No. 50/2017-Customs dated 30.06.2017 is also proposed to be amended retrospectively to insert correct CTH of Stearic Acid in the notifications with effect from 01.07.2017. [82]

[83]

2 Notification No. 86/2018-Customs dated 31st December, 2018 amending notification No. 296/76-Customs dated 2nd August, 1976 is proposed to be given retrospective effect so as to exempt IGST and compensation cess leviable under section 3(7) and section 3(9) of the Customs Tariff Act, 1975 respectively, on the temporary importation of vehicles under the Customs Convention on the Temporary Importation of Private Road Vehicles (carnet de passages-en-douane) for the period 1st July, 2017 to 31st December, 2018. [84]
3 Retrospective effect, for the period 21st October, 2015 to 22nd February, 2016 to notification No. 5/2016-Customs (ADD) dated 22nd February, 2016 to insert correct classification of product under consideration for ADD namely All Fully Drawn or Fully Oriented Yarn/Spin Draw Yarn/Flat Yarn of Polyester (non-textured and non – POY) (from 5402 to 5402 47). This notification amended the notification No. 51/2015-Customs (ADD) dated 21st October, 2015. [88]
4 Retrospective effect, for the period 8th March, 2016 to 4th July, 2016 to notification No. 29/2016-Customs (ADD) dated 5th July, 2016 to exclude ter polymer from the ambit of product under consideration for ADD on Polypropylene. This notification amended notification No. 7/2016-Customs dated 8th March, 2016. [89]

Extract of Clause 82, 83, 84, 88, 89 of Finance Bill 2019

82. Amendment of notifications issued under sub-section (1) of section 25 of Customs Act, retrospectively.

(1) The notifications of the Government of India in the Ministry of Finance (Department of Revenue) numbers G.S.R. 423(E), dated the 1st June, 2011, G.S.R. 499(E), dated the 1st July, 2011 and G.S.R. 185(E), dated the 17th March, 2012 issued by the Central Government under sub-section (1) of section 25 of the Customs Act, 1962, shall stand amended and shall be deemed to have been amended in the manner as specified in the Second Schedule, on and from the date mentioned in column (4) of that Schedule, against each of such notifications, retrospectively, and accordingly, notwithstanding anything contained in any judgment, decree or order of any court, tribunal or other authority, any action taken or anything done or purported to have been taken or done under the said notifications, shall be deemed to be, and always to have been, for all purposes, as validly and effectively taken or done as if the notifications as amended by this sub-section had been in force at all material times.

(2) For the purposes of sub-section (1), the Central Government shall have and shall be deemed to have the power to amend the notifications referred to in the said sub-section with retrospective effect as if the Central Government had the power to amend the said notifications under sub-section (1) of section 25 of the Customs Act, retrospectively, at all material times.

83. Amendment of notification issued under sub-section(1) of section 25 of Customs Act and sub-section (12) of section 3 of Customs Tariff Act,retrospectively.

(1) The notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R. 785(E), dated the 30th June, 2017 issued by the Central Government under sub-section (1) of section 25 of the Customs Act, 1962 and sub-section (12) of section 3 of the Customs Tariff Act, 1975, shall stand amended and shall be deemed to have been amended in the manner as specified in the Third Schedule, on and from the date mentioned in column (4) of that Schedule and accordingly, notwithstanding anything contained in any judgment, decree or order of any court, tribunal or other authority, any action taken or anything done or purported to have been taken or done under the said notification, shall be deemed to be, and always to have been, for all purposes, as validly and effectively taken or done as if the notification as amended by this sub-section had been in force at all material times.

(2) For the purposes of sub-section (1), the Central Government shall have and shall be deemed to have the power to amend the notification referred to in the said sub-section with retrospective effect as if the Central Government had the power to amend the said notification under sub-section (1) of section 25 of the Customs Act and sub-section (12) of section 3 of Customs Tariff Act, retrospectively, at all material times.

84. Retrospective effect of notification issued under sub-section (1)of section 25 of Customs Act and sub-section(12) of section 3 of Customs Tariff Act.

The notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R. 1270(E), dated the 31st December, 2018 amending the notification number G.S.R. 665 (E), dated the 2nd August, 1976, which was issued in exercise of powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 and sub-section (12) of section 3 of the Customs Tariff Act,1975 shall be deemed to have, and always to have, for all purposes, come into force on and from the 1st day of July, 2017.

88. Validation of modification in classification of certain goods leviable to anti-dumping duty with retrospective effect.

(1) The notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R. 186 (E), dated the 22nd February, 2016 amending the notification number G.S.R. 804 (E), dated the 21st October, 2015, issued in exercise of the powers conferred by sub-sections (1) and (5) of section 9A of the Customs Tariff Act, 1975 read with rules 18 and 20 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 shall be deemed to have, and always to have, for all purposes, validly come into force on and from the 21st day of October, 2015.

(2) Refund shall be made of all such anti-dumping duty which has been collected, but which would not have been so collected, if the notification referred to in sub-section (1) been in force at all material times.

(3) An application for refund of anti-dumping duty referred to in sub-section (2) shall be made within a period of six months from the date on which the Finance (2) Bill, 2019 receives the assent of the President.

89. Validation of modification in description of goods with retrospective effect.

(1) The notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R.665 (E), dated the 5th July 2016 amending the notification number G.S.R. 285 (E), dated the 8th March, 2016, issued in exercise of the powers conferred by sub-sections (1) and (5) of section 9A of the Customs Tariff Act, 1975, read with rules 18, 20 and 23 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 shall be deemed to have, and always to have, for all purposes, come into force on and from the 8th day of March, 2016.

(2) Refund shall be made of all such anti-dumping duty which has been collected, but which would not have been so collected, if the notification referred to in sub-section (1) been in force at all material times.

(3) An application for refund of anti-dumping duty referred to in sub-section (2) shall be made within a period of six months from the date on which the Finance (No.2) Bill, 2019 receives the assent of the President.

Note on Clause 82, 83, 84, 88, 89 of Finance Bill 2019

Clause 82 of the Bill seeks to make retrospective amendments to certain notifications issued under sub-section (1) of section 25 of the Customs Act, 1962, in the manner specified in Second Schedule, so as to change the tariff classification of Stearic acid from “3823 10 90” to “3823 11 00”.

Clause 83 of the Bill seeks to make retrospective amendments to notification number G.S.R. 785(E), dated the 30th June, 2017 issued under sub-section (1) of section 25 of the Customs Act, 1962 and sub-section (12) of section 3 of the Customs Tariff Act, 1975 in the manner specified in Third Schedule, so as to change the tariff classification of Stearic acid from “3823 10 90” to “3823 11 00”.

Clause 84 of the Bill seeks to give retrospective effect to the notification number G.S.R. 1270(E), dated the 31st December 2018, which was issued in exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 and sub-section (12) of section 3 of the Customs Tariff Act, 1975, to amend the notification number G.S.R. 665 (E), dated the 2nd August, 1976, on the temporary importation of vehicles as per the Convention on the Temporary Importation of Private Road Vehicles to bring it into force on and from the 1st July, 2017, so as to give retrospective exemption from the integrated tax leviable under section 3 of the Customs Tariff Act, 1975.

Clause 88 of the Bill seeks to give retrospective effect to the notification number G.S.R. 186 (E), dated the 22nd February, 2016, amending the notification number G.S.R. 804 (E), dated the 21st October, 2015, issued under sub-sections (1) and (5) of section 9A of the Customs Tariff Act, 1975, so as to retrospectively modify the tariff classification of the goods leviable to anti-dumping duty from tariff heading “5402” to tariff sub-heading “5402 47” on and from the 21st day of October, 2015 to 22nd day of February, 2016.

Clause 89 of the Bill seeks to give retrospective effect to notification number G.S.R. 665 (E), dated the 5th July, 2016, amending the notification number G.S.R. 285 (E), dated the 8th March 2016, issued under sub-sections (1) and (5) of section 9A of the Customs Tariff Act, 1975, so as to retrospectively exclude expanded Polypropylene beads and ter-polymer from the levy of anti-dumping duty from 8th March, 2016 to 5th July, 2016.

IV. Other Miscellaneous changes

1 To rephrase the existing entry to make the intention explicitly clear that prawn feed, shrimp larvae feed in any form are entitled to concessional rate of 5% whereas fish feed in pellet form only attracts 5%
2 To include HS 8486 in the notification No. 25/1998-Customs so as to explicitly exempt from BCD all the machines used for the manufacture of semi-conductors as included in the notification
3 To include “Headphones, earphones and combined microphone/speaker sets of Line Telephone handsets” in notification No. 25/2005-Customs dated 1st March 2005 as these items were included in the ITA agreement, by changing the description of goods against tariff sub heading 8518 30 00
4 To amend entry at S. No. 6A of the notification No. 57/2017-Customs so as to explicitly exclude microphones, receivers, speaker, connectors and SIM socket from the said entry

V. Effective change in rate of Road and Infrastructure Cess on Petrol and Diesel

S.
No.
Description Rate of Duty
Change in effective rate of Road and Infrastructure Cess, levied as additional duty of customs, on Petrol and Diesel From To
1 Motor spirit commonly known as petrol Rs. 8 per litre Rs 9 per litre
2 High speed diesel oil Rs. 8 per litre Rs 9 per litre

VI. Amendment In The Sixth Schedule To Finance Act, 2018

S. No. Amendments in scheduled rate of Road and Infrastructure Cess levied as additional duty of customs, on Petrol and Diesel [to be effective from 06.07.2019]* [Clause [201] of the Finance (No. 2) Bill, 2019] [effective rate is prescribed by notification as detailed in VII below] Rate of Duty
From To
1 Motor spirit commonly known as petrol Rs. 8 per litre Rs 10 per litre
2 High speed diesel oil Rs. 8 per litre Rs 10 per litre

* Will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931.

Extract of Clause 201 of Finance Bill 2019

201. Amendment of Act 13 of 2018.

In the Finance Act, 2018, in the Sixth Schedule, against Item Nos. 1 and 2, for the entry in 35 column (3), the entry “Rs.10 per litre” shall be substituted.

Note on Clause 201 of Finance Bill 2019

Clause 201 of the Bill seeks to amend the Sixth Schedule to the Finance Act, 2018, so as to increase the rate of road and infrastructure cess on motor spirit commonly known as petrol and high speed diesel oil , from rupees 8 per litre to rupees 10 per litre.

More Under Custom Duty

Leave a Comment

Your email address will not be published. Required fields are marked *