Exemption under Notification 50/2017 dated 30.06.2017 vis a vis notfn 25/2005

[Nash Industries I Pvt Ltd]

Import of Cash Dispenser falling under HSN 8472 is exempted vide serial number 467(i) and imports of parts of Cash Dispenser (hereinafter referred to as 'CD')is exempted vide serial number 467(ii) of Notification 50/2017.

Import of parts and components of CD for the manufacture of parts of CD (parts of CD falls under HSN 8473) is it exempted from the levy of BCD under the above notification.

Similarly import of ATM is exempted vide serial number 1 of Notification 25/2005 cus. Import of Parts of ATM is exempted vide serial number 33 of Notification 25/2005.

Both the cases are identical.

Would appreciate the revertal.

Regards

S.Ramaswamy

[KASTURI SETHI]

Dear Sir,

Pl. let me know whether the undermentioned notification is helpful to you or not.

Notification No. 46/2011-Cus. (import from specified countries under PTA), Notification No. 53/2011-Cus. (import from Malaysia) andNotification No. 50/2017-Cus. (import at Concessional Duty) amended

[Amend at page 312, 280 & 763 of 65th Edition of Customs Tariff, Vol. 1, 2017-18]

In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby amends the following notifications of the Government of India in the Ministry of Finance (Department of Revenue) specified in column (2) of the Table below, to the extent specified in the corresponding entries in column (3) of the said Table, namely :-

TABLE

S.No.	Notification No. and Date	Amendments
(1)	(2)	(3)
1	46/2011-Customs, dated the 1st June, 2011	In the said notification, in the Table, at serial number 443, in column (2), for the figures, “3823 11 90”, the figures “3823 11 00” shall be substituted.
2	53/2011-Customs, dated the 1st July, 2011	In the said notification, in the Table, at serial number 476, in column (2), for the figures, “3823 11 90”, the figures “3823 11 00” shall be substituted.
3	50/2017-Customs, dated the 30th June, 2017	In the said notification, (i) in the opening paragraph, for the figures and words, “17th March, 2017”, the figures and words “17th March, 2012” shall be substituted. (ii) in the Table, at S. No. 251, in column 2, for the figures, “3823 11 90”, the figures “3823 11 00” shall be substituted. (iii) in the Table, at S. No. 252, in column 2, for the figures, “3823 11 90”, the figures “3823 11 00,” shall be substituted. (iv) in List-4, in S. No. 86, for the words “Recuronium Bromide” the words “Rocuronium Bromide” shall be substituted. (v) in the Table, at S. No. 467, in column 2, for the figures, “8472 90”, the figures and words “8472 90 or 8473 40,” shall be substituted.

 

[Notification No. 76/2017-Cus., dated 15-9-2017]

[Nash Industries I Pvt Ltd]

Thank you sir for your prompt reply.

The moot question here is whether the import of parts of CD for the manufacture (assembly) of parts of CD is exempted under the said notification.

there are two views that is floating around. One view - Import of part of CD for the manufacture of CD is only exempted under the said notification (department view).

Assessee view- Parts of CD (sub parts) imported is used in the manufacture (assembly) of parts of CD and supplied to the OEM (Manufacturer of CD). Therefore, the sub parts that are also parts of CD is exempted under the above notification.

Seek your views.

Regards

S.Ramaswamy

[KASTURI SETHI]

Undoubtedly, the department will issue SCN for denial of exemption to sub-parts to be used in the manufacture of parts of CD.

In my view, exemption should be allowed inasmuch as the very purpose of exemption allowed to parts of CD would be defeated. The party will win the case through litigation only.

Such situation calls for clarification from the Board as it was done earlier in pre-GST era. Here is an extract from Board's Circular No.334/8/2016 -TRU dated 29.2.16

(12) Further, Basic Customs Duty and Excise Duty [and thus CVD] are being exempted on inputs and parts for manufacture of charger/adapter, battery and wired headsets/speakers of mobile handsets including cellular phone and inputs and sub-parts for use in manufacture of parts of charger/adapter, battery and wired headsets/speaker. Consequently, these goods will also be exempt from SAD, under S. No. 1 of Notification No. 21/2012-Customs. All these exemptions will be subject to actual user condition. Notification No. 12/2012-Customs, dated 17th March, 2012 as amended vide Notification No. 12/2016-Customs, dated 1st March, 2016 [new S. Nos. 431A to 431D] refers.

(13) Basic Customs Duty and Excise Duty [and thus CVD] are being exempted on parts, components and accessories for use in the manufacture of Routers, broadband Modems, Set-top boxes for gaining access to internet, set top boxes for TV, digital video recorder (DVR)/network video recorder (NVR), CCTV camera/IP camera, lithium ion battery [other than those for mobile handsets]. Further, Basic Customs Duty and Excise Duty [and thus CVD] are also being exempted on sub-parts for use in manufacture of parts, components and accessories of these Consumer Premise Equipments. Consequently, these goods will also be exempt from SAD, under S. No. 1 of Notification No. 21/2012-Customs. All these exemptions will be subject to actual user condition. Notification No. 12/2012-Customs, dated 17th March, 2012 as amended vide Notification No. 12/2016-Customs; dated 1st March, 2016 [new S. Nos. 431E to 431K] refers.

Also see Notification No.22/16-CE dated 5.5.16 (Such like clarification is required from the Board. In the absence of clarification SCN is certain.

263W	Any Chapter	(a)		Parts or components for use in manufacture of Populated printed circuit board of, -			Nil	2
				(i)		Lithium-ion battery other than battery for mobile handset [tariff item 8507 60 00];
				(ii)		Broadband Modem [tariff item 8517 62 30];
				(iii)		Router [tariff item 8517 69 30];
				(iv)		Set-top box for gaining access to internet [tariff item 8517 69 60];
				(v)		Digital Video Recorder (DVR)/Network Video Recorder (NVR) [tariff item 8521 90 90];
				(vi)		CCTV Camera/IP Camera [tariff item 8525 20 80];
				(vii)		Reception apparatus for television but not designed to incorporate a video display [tariff item 8528 71 00].
		(b)		Sub-parts for use in the manufacture of the parts or components at (a) above.			Nil

[Nash Industries I Pvt Ltd]

thank you sir.

Have taken up the matter with the Govt through the industry association as well as from the company. Awaiting the response from the Govt.

Thanks

Regards

S.Ramaswamy

[KASTURI SETHI]

Yes, Sir. You are proactive: so your efforts will yield timely results. Hence would be able to avoid avoidable SCN. Timely action and sincere efforts never go unrewarded. I think so.

AI Summary

Debate on Customs Duty Exemption for Cash Dispenser Parts Under Notifications 50/2017 and 25/2005: Manufacturer vs. Department A discussion on a forum addresses the exemption of customs duty for parts of cash dispensers (CD) and ATMs under Notifications 50/2017 and 25/2005. The initial query questions whether parts used in manufacturing CDs are exempt from the basic customs duty (BCD). The discussion includes differing views: the department's stance that only parts for manufacturing CDs are exempt, while the assessee argues that sub-parts used in assembly should also be exempt. The discussion suggests seeking clarification from authorities to avoid potential legal issues, and efforts are underway to address this with the government.