Parts of Cycle

[MK Singh]

Duty structure on import of bi cycle parts is 20 % whereas duty structure on complete cycle is 30%. it is seen that department often demand 30 per cent duty on bi cycle parts whereas in tariff book it is already given at 20 %. Department is quoting the The General rule of Interpretation 2(a) which says that if the incomplete goods have essential character of complete goods it can be consider as complete goods.

My questions are :

1. Whether it is right to do so by the department. What is the legal stand on it?

2. If Customs Tariff books itself gives it classification and have separate duty structure, how can parts can be considered as complete cycle?

3. Who will decide the essential character as mentioned in the Rule 2(a) of Interpretative Rule?

please guide me on this essential topic.

AI Summary

Customs Duty Dispute: Bicycle Parts vs. Complete Bicycles Under General Rule of Interpretation 2(a) A query was raised regarding the customs duty on bicycle parts, which is set at 20%, compared to a 30% duty on complete bicycles. The department often demands the higher duty for parts, citing General Rule of Interpretation 2(a), which allows incomplete goods with the essential character of complete goods to be taxed as complete goods. The inquirer questioned the legality of this practice, the classification in the Customs Tariff book, and who determines the essential character. The response indicated that if the parts can be assembled into a complete bicycle, they may be assessed as a complete bicycle in a completely knocked down condition.