Illustration: Ajay Mohanty
As traders, we purchase goods from the domestic market and export, claiming duty refunds at All Industry Rates and Rodtep benefits. Did Customs rightly request our purchase invoices?
Yes. Rule 9 of the Customs and Central Excise Duties Drawback Rules, 2017 and the proviso in paragraph 2(1)(b) of Notification No. 76/2001-Cus (NT) dated September 23, 2021 placed a limit on the amount of refund and Rodtep credit that may be granted, based on the market price of the goods.
I refer to Sections 25A and 25B of the Customs Act, 1962, which deal with inward processing of goods and outward processing of goods. Can we opt for the exemptions given here for importing or exporting goods for work?
No. These sections, introduced through the Finance Act 2018, require the government to issue exemption notices. Nearly six years have passed; yet the government has not issued any notification under these articles. So they remain out of action.
I am not satisfied with your response that with regard to the export of SCOMET items under GAMC, the government wants to ensure that the exporter has sufficient confidence in the buyer/end user to take responsibility for his actions. (SME chatroom January 9, 2024). My point is that even if we do all the necessary research and even include a clause in the purchase order that the exported items are not to be used for any purpose other than those stated in the EUC (End User Certificate) and that such use will not be modified nor will the articles be modified or replicated without prior permission from the Government of India. It is not possible for us to ensure that the buyer/end user will always meet this condition. Once the goods leave our hands, we no longer have any control. Could you please tell us how we can proceed?
As Section 10.16 A.II.b.ii of HBP reads today, the applicant exporter is required to declare that the items intended for export will not be used for any purpose other than those stated in the EUC . (End User Certificate) and that such use will not be modified nor the items modified or replicated without prior permission from the Government of India. I agree that this provision is unreasonable, but as long as the provision exists, the government will likely insist that you comply with this requirement. I think you should indicate to the DGFT your difficulty in making such a statement and continue the matter until that provision is amended.
Section 65A was inserted into the Customs Act, 1962 through the Finance Act, 2023, which provides for levy of Integrated GST and Compensation Cess on goods imported for production in bonded warehouses. This section would come into effect from a date to be announced by the government. Has this article entered into force and if so, since when?
No. The government has not yet announced the date on which the provisions of this article will come into force.
First print: January 23, 2024 | 00:00 IST