BAsic Customs duty

[Madhavan iyengar]

A is a DTA in Gujarat and wants to supply some parts to a EOU -B in Gujarat

A is importing the parts and pays basic Customs duty since this is a cost to A and then s these parts have to supplied to EOU-B

Query

Can A get benefit of nil basic customs duty by stating that it is importing it on behalf of the EOU

Or there is no other option but to ask EOU - B to import the parts directly without payment of Basic customs duty

Experts please suggest

[Alkesh Jani]

Sir,

As per the query raised, I am of the view that second option seems to be good. As first option is not legally viable.

Thanks

AI Summary

Basic customs duty: importing on behalf of an EOU cannot secure nil duty; EOU should import directly.
Declaring imports by a Domestic Tariff Area unit as made on behalf of an Export Oriented Unit to obtain nil basic customs duty is not legally viable; the recommended course is direct importation by the EOU to secure exemption from basic customs duty.