Faceless Assessment- CBIC Clarifications/guidelines

Circular No. 55/2020-Customs

F.No.450/26/2019-Cus. IV(Pt)
Government of India
Ministry of Finance
Department of Revenue
(Central Board of Indirect Taxes & Customs)

*****

Room No.227B, North Block.
New Delhi, dated the 17^th of December, 2020

To,

All Principal Chief Commissioners/ Chief Commissioners of Customs/ Customs (Preventive),
All Principal Chief Commissioners/ Chief Commissioners of Customs & Central tax,
All Principal Commissioners/ Commissioners of Customs/ Customs (Preventive),
All Principal Commissioners/ Commissioners of Customs & Central tax,
All Principal Director Generals/ Director Generals under CBIC.

Madam/Sir,

Subject: Faceless Assessment- Clarifications on the Issues raised by Stakeholders-reg.

Kind reference is invited to Board’s earlier Circulars and Instruction on the subject of

Faceless Assessment.

2. After a series of consultations with various stakeholders, such as the NACs, trade and industry associations, it is felt that there is a need to further enhance the efficiency of the process involved in Faceless Assessment. With a view to achieve this objective, certain key areas, which require immediate attention, have been identified and the following instructions/ guidelines are being hereby issued so as to smoothen the process of Faceless Assessment by the field formations.

a) Re-assessment in accordance with the Principles of Natural Justice: Despite several Board instructions on the issue, it has been observed that many a times the importers are not being afforded an opportunity of being heard before re-assessment of the goods. Such a practice is not in conformity with the provisions of law and needs to be accordingly discontinued, forthwith. It is emphasised that the process of re­assessment must be in accordance with the provisions of Sub Sections (4) and (5) of Section 17 of Customs Act, 1962. In order to lend clarity and streamline this process, the procedure to be adopted by the FAGs for carrying out re-assessment, wherever required, is delineated as follows:

i. During verification of the assessment, if there are reasons to believe that the self-assessment is not done correctly, or additional details are required to complete the verification, necessary clarifications should be sought from the importer/Customs Broker through the query module of ICES.

ii. While raising the query, all the aspects of additional information required for finalisation should be covered and clearly worded. Also, as far as possible, multiple queries need to be avoided and all the information may be solicited in one-go and not in a piece-meal manner. Further, in the event that the officer concerned is required to raise a second (or more) query/ies on the same Bill of Entry, approval shall be taken from the respective Additional Commissioner/Joint Commissioner, with full justification thereof. Needless to say, this approval should be given only as an exception and not as a matter of routine. Pr.Commissioners / Commissioners across the NACs may ensure that minimal queries are raised by the concerned FAGs and may devise their own mechanism to regularly monitor the same, in a manner that needless and repeated queries, which have the effect of delaying assessments, are avoided.

iii. Based on the reply to the query, the FAG may either accept the self-assessment or proceed to re-assess the Bill of Entry.

iv. While re-assessing the Bill of Entry, it must be ensured that the importer is given an opportunity to justify the self-assessment either in writing or in person through Video Conferencing. The importer, can, if he so desires, waive off this requirement in writing. No re-assessment, which would lead to change in classification, valuation and/or applicability of notification etc, should be carried out, unless an opportunity is provided to the importer for presenting his/her viewpoint.

v. Where the assessing officer re-assesses the Bill of Entry and where the importer does not accept the change in assessment in writing, through the query module in ICES, the proper officer shall mandatorily issue a speaking order without delay and in accordance with Sub-Section (5) of Section 17 of Customs Act, 1962.

b) Complete description of imported goods: It has been brought to the notice of the Board that one main reason for the raising of a query is that in many instances, the importers do not give complete description of the imported goods, while filing the Bill of Entry. This constrains the assessing officer and delays the process of verification of the assessment by the FAG. Therefore, it is important that the importers/Customs Brokers are advised to give the complete description of the imported goods while filing the Bill of Entry, in the first instance. In this context, the attention of the importers/Customs Brokers may be drawn to the following fields that are available in the electronic Bill of Entry format:

i. Generic Description : The description in generic text relevant to text provided in the duty exemption notification that is claimed/Anti-Dumping (ADD)/IGST levy, as applicable.

ii. Specific Description: The description specific to the product and as given in the invoice, trade name or specific product details to be provided (Brand name or model details may be avoided-same needs to be provided separately).

iii. Model and Brand Name: Model details and Brand Name may be provided and if the imported goods are unbranded, the text “UNBRANDED” may be used.

iv. Supplier and Manufacturer Details : In cases where duty applicability is based on manufacturers such as Anti-Dumping Duty (ADD), Safeguard Duty (SD) etc, the details of manufacturer may be provided. In case of products attracting ADD, these details would be required to be mandatorily provided.

v. Item Qualifiers: Some imported items may have specific distinguishing characteristics or have industry specific names (e.g. scientific names, IUPAC names etc.). These item names or qualifiers may be declared, as applicable. The illustrative list of such item qualifiers are at Annexure A. DG Systems, CBIC would shortly issue a detailed advisory for guidance of the trade, in this regard.

vi. Previous Bills of Entry : The Bill(s) of Entry details of previous import may be mentioned, if available.

c) Document codes for regular documents to be uploaded in e-Sanchit: Another reason why FAG officers are compelled to raise queries is that importers/Customs Brokers are not uploading all the required supporting documents to justify their claim of a duty exemption notification or fulfilment of a CCR requirement etc. along with the Bills of Entry. It appears that this is happening, as in the past, the importers/Customs Brokers were habituated to produce these documents directly to the assessing officers. As these documents are essential for carrying out verification of self-assessment by the FAG and their non-submission at the stage of filing the Bill of Entry delays the verification/assessment process, Board has decided that w.e.f. 01.2021, these supporting documents shall be mandatorily required to be uploaded in e-Sanchit by the importers/Customs Brokers, in such situations. The illustrative list of the required documents along with their document code and description is at Annexure B. DG Systems, CBIC would shortly issue a detailed advisory for guidance of the trade, in this regard.

d) Enhancement in the monetary limit for assessment by the Appraising Officers: As of the present, all Bills of Entry with an assessable value of up to Rupees 1 lakh are assessed only by the Appraising Officers. All Bills of Entry beyond the above threshold , are necessarily subjected to a two-step scrutiny, first by the Appraising Officer and then by the Deputy/Asst. Commissioner of Customs. In order to expedite the assessment process, it has been decided that an enhancement in these long standing prescribed monetary limits would speed-up the assessment process. Accordingly, the Board has decided to enhance the monetary limit of assessment of Bills of Entry by the Appraising Officers. All Bills of Entry with an assessable value of up to Rupees 5 lakh shall be accordingly finally assessed only by the Appraising Officers, w.e.f 21.12.2020. However, the re-assessments of Bills of Entry would continue to be done with the approval of the Assistant/Deputy Commissioner, as is the present practice. In order to assess the impact of this change, the Board has also decided that 10% of the Bills of Entry that are now entrusted to the Appraising Officers would be subjected to transactional PCA. A fortnightly report on the outcome of the transactional PCA would be submitted to Joint Secretary (Customs), CBIC with first report being due on 05.01.2021.The Pr. Commissioners/Commissioners concerned would also monitor the outcome of this change and immediately inform the Board, if any correction is required.

e) Assessments in respect of Liquid Bulk Cargo : The Board has also received representations in respect of delays in the assessment of liquid bulk cargo. One common refrain of the trade here is the unnecessary resort to the First Check System of assessment, in such cases. With respect to import of `liquid bulk cargo`, it is stated that the assessments are to be carried out on a provisional basis. This is primarily on account of the ascertainment of actual imported quantity which is done subsequently. Also, at times, there may be a doubt with respect to the composition, product specification etc. Both these aspects do not warrant a First Check system of assessment. The respective Co-Convenors of the NACs assessing such consignments are advised to ensure that all such consignments are subjected to the Second Check system of assessment, with duty being assessed on a provisional basis. Moreover, the concerned officers in the FAGs and the respective NAC Commissioners may be suitably sensitised to follow Board’s Circulars No. 34/2016–Cus, dated 26.07.2016 and No.38/2016- Cus, dated 22.08.2016, while carrying out such assessments. Board has also observed that suitable templates in the form of Public Notices, issued by major Custom Houses are available in the public domain, so as to serve as a ready reckoner and guidance tool for the Assessing Officers, for assessment of liquid bulk cargo. The same maybe incorporated as standard practice by the concerned NACs, with a view to remove any ambiguity in the process to be followed.

4. Any difficulties faced or doubts arising in the implementation of this Circular may please be brought to the notice of Board.

Yours faithfully,

(Ananth Rathakrishnan)

Deputy Secretary (Customs)

Annexure A

Annexure B-1

(Documents already made mandatory as per Circular No.42/2019-Customs dated 29.11.2019, Notification No .81 / 2020-Customs-N.T. dated 21.08.2020 read with ICES Advisory No.34/2020 dated 17.09.2020)

Annexure B-2

(Documents mandatory ONLY when benefit of relevant notification is claimed)

Annexure B-3

(Documents mandatory as per restrictions/prohibitions -Specific only to certain Tariff items)

Annexure B-4

(Documents which are optional and are required on case to case to basis)