Central Government vide Notification No. 113/2016-Customs (N.T.), Dated: August 22, 2016 has rescinded The Customs (Provisional Duty Assessment) Regulations 2011 as Section 18 of the Customs Act, 1962 itself defines the cases where provisional assessment may be resorted and requires that:
a) the importer binds himself for the payment of deficiency, if any, between the duty as may be finally assessed and the duty provisionally assessed; and
b) furnishes such security as the proper officer deems fit for the payment of the deficiency.
Herein the amount of security is at the will of the proper officer which may be different in different cases. Thus to maintain uniformity of practice, transparency and predictability for the tax payer, the Central Government vide Circular No. 38/2016-Customs, Dated: August 22, 2016 has provided that wherever, duty is to be assessed provisionally, the importer shall:
a) for the purposes of undertaking to pay on demand the deficiency, if any, between the duty as may be finally assessed and the duty provisionally assessed, execute a bond in the prescribed form; and
b) furnish such “Amount of Bank Guarantee or Cash deposit to be obtained as “security” of the differential duty” for the payment of the duty deficiency, prescribed as per his class.
It has further been reiterated that the amount of security will be determined on the basis of duty differential and not the CIF value of goods. Also provisional assessments under section 18 will be carried out with respect to cases only where the duty is in dispute.
[To be published in the Gazette of India, Extraordinary, Part II, Section 3, Sub‑section (i)]
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
(CENTRAL BOARD OF EXCISE AND CUSTOMS)
Notification No. 113/2016 – Customs (N.T.)
New Delhi, the 22nd August, 2016
G.S.R. __ (E).- In exercise of the powers conferred by section 157 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise and Customs hereby rescinds the notification of the Government of India in the Ministry of Finance, Department of Revenue (Central Board of Excise and Customs) number 81/2011-Customs (N.T.) dated the 25th November, 2011 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 840 (E), dated the 25th November, 2011, except as respects things done or omitted to be done before such rescission.
[F. No. 465/01/2016-Cus V]
Under Secretary to the Government of India