Duty payable at the time of de-bebonding of capital goods

[Guest]

In STPI scheme and as per foreign trade policy value of capital goods after 5 years become NIL and in such case when we opt for de-bonding of capital goods we need not to pay any custom / excise duty. However Exicse Dept in Mumbai insist on paying duty on scrap valu. Pleas let us know whether practice following by excise dept is correct and which notification they are following to recover such duty.

[Surender Gupta]

You refer to amended notifications no. 52/2003 Cus and 22/2003 CE where capital goods allowed to cleared on depreciated value where NFE has been achieved.

Or as adjusted depreciated value where NFE has not been achieved.

AI Summary

Debate on Customs Duty for De-bonded Capital Goods: Scrutiny of Notifications 52/2003 Cus & 22/2003 CE for Depreciated Value In a discussion about customs duty on de-bonding capital goods, a participant questioned the requirement to pay duty on goods considered to have no value after five years under the STPI scheme and foreign trade policy. The Excise Department in Mumbai insists on duty payment based on scrap value. A respondent advised referring to amended notifications 52/2003 Cus and 22/2003 CE, which allow clearance of capital goods on depreciated value if Net Foreign Exchange (NFE) is achieved, or adjusted depreciated value if not.