Udyog Tax News Flash

January 2014

Customs: new Baggage Declaration Regulations w.e.f. 1 March 2014

The CBEC had notified new Baggage Declaration Regulations under section 81(a) of the Customs Act, vide notification 90/2013-Customs (NT) dated 29 August 2013. These, including the form prescribed for declaring passenger baggage, were to come into effect from 1 January 2013. This date has been changed to 1 March 2014, by notification 133/2013-Customs (NT) dated 30 December 2013: http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/csnt2013/csnt133-2013.htm.

Customs: tariff values notified

The CBEC has notified tariff values for specified items under section 14 of the Customs Act 1962 under notification 134/2013-Customs (NT) dated 31.12.2013. Tariff values of gold, silver and specified oils/oleins have been reduced. The notification can be seen at http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/csnt2013/csnt134-2013.htm.

Customs: exchange rates notified

The CBEC has notified exchange rates for nineteen currencies, effective from 3 January 2014. Under this notification, the US dollar converts to INR 62.35 for imported goods and to INR 61.35 for export goods. The pound sterling converts to INR 103.85 for imported goods and to INR 101.55 for export goods. The notification, number 1/2014-Customs (NT) dated 2 January 2014, can be seen at http://cbec.gov.in/customs/cs-act/notifications/notfns-2014/csnt2014/csnt1-2014.htm.

Customs: dumping duty on phosphoric acid from China extended

The DG Anti-Dumping undertook sunset review of the anti-dumping duty imposed under notification 17/2008-Customs on phosphoric acid from China and has recommended extension of the duty, at modified rates, for another five years. Accordingly the central government has issued notification 33/2013-Customs (ADD) dated 31 December 2013 to impose anti-dumping duty on phosphoric acid, technical grade and food grade

(including industrial grade) originating in or exported from the Peoples Republic of China. The notification 33/2013-Customs (ADD) dated 31 December 2013 can be seen at http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/csadd2013/csadd-33-2013.htm.

Customs: dumping duty on DVDs from Vietnam enhanced

Anti-dumping duty had been imposed on recordable DVDs (digital versatile discs) from Vietnam, Thailand and Malaysia, under notification 98/2010Customs dated 28 September 2010. The DG Anti-Dumping undertook a review and recommended increase of the duty on the goods from Vietnam. Accordingly the central government has issued notification 34/2013Customs (ADD) dated 31 December 2013 to amend the original notification, increasing the anti-dumping duty on such DVDs originating in or exported from Vietnam to USD 73.01 per 1000 pieces. The notification 34/2013Customs (ADD) can be seen at http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/csadd2013/csadd-34-2013.htm.

Customs: safeguard duty investigation extended

The central government has issued notification 132/2013-Customs (NT) dated 27 December 2013 to extend the date for submission of final findings in the safeguard investigation concerning import of seamless pipes, tubes and hollow profile of iron or non-alloy steel. The last date is now 21 March 2014. The notification can be seen at http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/csnt2013/csnt132-2013.htm.

Customs: duty rates reduced in terms of trade agreements with specified countries
The central government has deepened tariff concessions in terms of the time schedule incorporated in trade agreements with Korea, Japan, Malaysia and the ASEAN countries, as per details below. Indo-Korea CEPA

In terms of the Comprehensive Economic Partnership Agreement (CEPA) with Korea, India is to reduce its import duties on specified goods from Korea in graduated stages. The central government has, accordingly, issued notification 54/2013-Customs dated 31 December 2013 to deepen tariff concessions on goods imported from Korea, by amending notification 152/2009-Customs dated 31 December 2009: http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/cstarr2013/cs54-2013.htm. Indo-Japan CEPA Similarly, in terms of the Comprehensive Economic Partnership Agreement (CEPA) with Japan, India is to reduce its import duties on specified goods from Japan in graduated stages. The central government has, accordingly, issued notification 55/2013-Customs dated 31 December 2013 to deepen tariff concessions on goods imported from Japan, by amending notification 69/2011-Customs dated 29 July 2011: http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/cstarr2013/cs55-2013.htm. Indo-Malaysia CECA In terms of the Comprehensive Economic Cooperation Agreement (CECA) with Malaysia, India is to reduce its import duties on specified goods from Malaysia in graduated stages. The central government has, accordingly, issued notification 56/2013-Customs dated 31 December 2013 to deepen tariff concessions on goods imported from Malaysia, by amending notification 53/2011-Customs dated 1 July 2011: http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/cstarr2013/cs56-2013.htm. Indo-ASEAN FTA India has a Free Trade Agreement with Malaysia, Singapore, Thailand, Vietnam, Cambodia, Myanmar, Indonesia, Brunei Darussalam, Lao Peoples Democratic Republic, and Philippines, in terms of which the duty rates for specified imports have to be reduced in graduated stages. The first exemption notification to operationalize reduction in import duties was 46/2011-Customs dated 1 June 2011. Now, to operationalize the agreement for phased reduction in duties, the central government has issued notification 57/2013-Customs dated 31 December 2013 which amends 46/2011-Customs dated 1 June 2011 by reducing the duties in the table: see http://cbec.gov.in/customs/cs-act/notifications/notfns-2013/cstarr2013/cs57-2013.htm.

Customs: SAD leviable on stock transfer from SEZ to DTA CBEC clarifies
The CBEC has clarified that as SAD is leviable on clearances from SEZ to DTA on which no VAT or sales tax is payable, it will be leviable on stock

transfers, as no VAT or sales tax is payable on stock transfer. CBEC circular 44/2013-Customs dated 30 December 2013 to this effect is downloadable from http://cbec.gov.in/customs/cs-circulars/cs-circ13/circ44-2013-cs.htm.

Customs: cargo service providers not to outsource operations in customs area

The CBEC has emphasized that customs cargo service providers are not to lease out any area in the customs zone or outsource any of the operations carried out in that space without the written permission of the Commissioner, as this would be in contravention of the relevant Regulations. It has warned that all cases of violation shall be dealt with sternly and offenders shall be punished. The circular 45/2013-Customs dated 31 December 2013 to this effect can be seen at http://cbec.gov.in/customs/cs-circulars/cs-circ13/circ45-2013-cs.htm.

Central excise: tariff value fixed for certain cosmetic products

Under section 4A of the Central Excise Act, valuation for the purpose of excise is based on the retail sale price for certain categories of sales of specified products. The products must be in retail packages, subject to the requirement of marking MRP under the Legal Metrology Act, and the sales must be non-institutional and non-industrial. Now, for goods of heading 3304 of the Central Excise Tariff (which is HS-based), which are in retail packages, the central government has notified a tariff value under section 4, based on retail sale price, which will be applicable to those categories of goods/sales to which section 4A does not apply. This has been effected by issue of notification 16/2013-Central Excise (NT) dated 31 December 2013 under section 3(2) of the Central Excise Act 1944: http://cbec.gov.in/excise/cx-act/notfns-2013/cx-nt2013/cent16-2013.htm.

Central excise: Cenvat Credit Rules amended

The central government has issued notification 17 and 18/2013-Central Excise dated 31 December 2013 to amend the Cenvat Credit Rules 2004 in respect of issue of Cenvatable invoices by an importer. Now an importer who issues Cenvatable invoices is required to get himself registered and function as a first stage dealer. The notifications may be perused at

http://cbec.gov.in/excise/cx-act/notfns-2013/cx-nt2013/cent17-2013.htm, http://cbec.gov.in/excise/cx-act/notfns-2013/cx-nt2013/cent18-2013.htm.

Service tax and Central excise: lowered threshold of e-payment now in effect
We had earlier reported the lowering of the threshold for mandatory epayment of central excise duty/service tax to one lakh of rupees. Assessees who have paid central excise duty or service tax (whether through Cenvat or cash) of over one lakh of rupees in the previous financial year are required to pay the duty/tax by e-payment, as per notification 15/2013Central Excise (NT) and 16/2013-ST, both dated 22 November 2013. These notifications came into effect from 1 January 2014.

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Updated and written by Radha Arun [radha.arjuni@gmail.com], Consultant to Udyog Software (India) Ltd.
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