CUSTOMS ACT,

1962

LEARNING
OUTCOME
Understanding provisions of
Levy,
Exemptions,
Assessment of Custom Duty

(A) Imposition of customs duty

Levy

Assessment

Collection

(B) Factors to determine liability

Goods on which duty is leviable

Point and circumstances of duty
Mechanism for assessment
Exemption from duty
Remission and abatement of duty
Relevant date of rate and tarif

(ii) Point and circumstances

Taxable point
Clearance of goods
Re-importation of goods produced in
India (U/s 20)
Duty on derelict/ jetsam/ wreck (U/s 21)

(iii) Assessment u/s 2 (2)

(a)Means :Determination of :
()duty
()value of goods
()duty
payable
along
with
other
documents.
(b) Statutory definition:
()Self assessment (section 17)
()Re-assessment (section 17)
()Provisional assessment (section 18)
()Any assessment duty assessed is NIL

self Assessment u/s 17

Applies to:
- an importer entering any imported goods
(U/s 46)
- an exporter entering any exported goods
(U/s 50)
SHALL SELF-ASSESS THE DUTY LEVIABLE
ON SUCH GOODS.
Verified by proper officer examine or
test:
- Imported goods
- Exported goods
Electronically mandatory manually

re-Assessment u/s 17
INCORRECT
17 (4):

SELF-ASSESSMENT

U/s

- On verification/ examination/ testing

- Self- assessment Not done correctly
- Proper officer may Re assess the
duty leviable

re-Assessment u/s 17
PASSING
OF
SPEAKING
REASSESSMENT ORDER:
Any re assessment done under 17 (4):
And it is contrary to self- assessment
done by importer/ exporter regarding:
valuation,
classification,
exemption/concessions
OR
Importer/ exporter does not confirm
acceptance said re assessment in
writing.
Pass order within 15 days - date of re
assessment bill of entry/ shipping bill

re-Assessment u/s 17
PASSING
OF
SPEAKING
REASSESSMENT ORDER:
Any re assessment done under 17 (4):
And it is contrary to self- assessment
done by importer/ exporter regarding:
valuation,
classification,
exemption/concessions
OR
Importer/ exporter does not confirm
acceptance said re assessment in
writing.
Pass order within 15 days - date of re
assessment bill of entry/ shipping bill

Audit of self assessment

Where re- assessment/ speaking order
not passed.
Proper officer may audit:
- Assessment of duty
- At his office/ at the premises - imported/
export goods
- In manner prescribed On site Post
clearance Audit at the Premises of
Importers and Exporters Regulations,
2011

provisional Assessment u/s 18

It is pending Final Assessment
Cases U/s 18 (1):
When importer unable to make self
assessment
Where proper officer deems it
necessary to carry out chemical or
other tests
When importer/ exporter submitted/
produced all documents P.O. make
further enquiry

Exemption U/s 25

General

Special

General: Central Govt. satisfied

necessary in public interest exemption
(absolutely/ subject to conditions)
Special: Central Govt. satisfied
necessary in public interest Special
Order ( in exceptional nature) exempt
goods from payment of duty (cash)

Exemption U/s 25
Grounds for exemptions:
Moral Grounds:
- Goods do not reach Indian soil
- Goods reached India but not available for
consumption
- Goods damaged/ deteriorated in transit.
Discretionary Grounds: Central Govt.,
allow exemption :
- For controlling economy
- Industrial growth of the country

Exemption U/s 25

Exemption not exceed Statutory Duty

Date of implementation
Preferential Rate of duty
Lower rate of duty under trade
agreement (determination of origin)

Remission and abatement

Remission/ Abatement of duty:
In case of pilfered goods (U/s 13)
In case of damaged/ deteriorated goods
(U/s 22)
In case of lost/ damaged or abandoned
goods (U/s 23)
Short-packed or short-landed goods

Remission on Pilfered Goods

Importer not liable to pay duty, if:
Imported goods pilfered (small theft);
Such pilferage take place
- After the un loading thereof and
- Before the proper officer made order for:
- clearance for home consumption
- deposit in warehouse
If restored (goods): liable to pay duty
Pilferage in Custody: Custodian is liable to pay
duty.

Remission on Pilfered Goods

Situation 1: before arrival of goods in
India No Liability.
Situation 2: after arrival but before
customs clearance Liable to pay (but
extinguished U/s 13 of the Act)
Situation
3:
after
custom
examination but before order of
clearance Liable to pay but can
claim refund.

Remission on lost, destroyed, abandoned

Situation 1: Lost or destroyed

It is shown
- To the satisfaction of Assistant/ Deputy
Commissioner
- That goods have been: a) Lost (other
than pilferage); b) destroyed
- Any time - before clearance - home
consumption.
Treatment:
Assistant/ Deputy Commissioner shall
remit duty on such goods.

Remission on lost, destroyed, abandoned

Situation 2: Relinquishment of Title

Owner of goods any time before :
- Order for home consumption (U/s
47)or
- Deposit in warehouse (U/s 60)
- Relinquish the title
Treatment:
Shall not pay duty on such goods.
but not in case of ofending goods

Remission on damaged or deteriorated goods

Any of the three circumstances:

Situation 1: before arrival of goods in
India Situation 2: after arrival but
before customs clearance
Situation
3:
after
custom
examination but before order of
clearance
Then relief of duty - out of total
duty is given on such goods

Short packed or short landed goods

Short Packed: not reached Indian

territory NO DUTY
Short landed: by mistake: unloaded
at other port or not unloaded
destination: NO DUTY