Public consultation on the proposal to amend Customs Valuation (Determination of Price of Imported Goods) Rules, 2007

The Central Govt. proposes to consider the following amendments to the Customs Valuation (Determination of Price of Imported Goods) Rules, 2007:

The Place of Importation is sought to be defined by insertion of sub-rule (da) to Rule 2 as follows:

“Place of Importation” means the customs station where the goods have been brought for being cleared for home consumption or in the case of goods to be removed to a bonded warehouse, the customs station from where goods are to be removed for the purpose of deposit in a warehouse”

Sub-rule (2) to Rule 10 is proposed to be replaced with the following:

(2) For the purposes of sub-section (1) of section 14 of the Customs Act, 1962 (52 of 1962) and these rules, the value of the imported goods shall be the value of such goods, and include -

(a) the cost of transport, loading, unloading and handling charges associated with the delivery of the imported goods to the place of importation;

(b) the cost of insurance to the place of importation

Provided that where the cost of transport referred to in clause (a) is not ascertainable, such cost shall be twenty per cent of the free on board value of the goods;

Provided further that where the free on board value of the goods is not ascertainable but the sum of free on board value of the goods and the cost referred to in clause (b) is ascertainable, the cost referred to in clause (a) shall be 20% of such sum;

Provided also that where the cost referred to in clause (b) is not ascertainable, such cost shall be 1.125% of free on board value of the goods;

Provided also that where the free on board value of the goods is not ascertainable but the sum of free on board value of the goods and the cost referred to in clause (a) is ascertainable, the cost referred to in clause (b) shall be 1.125% of such sum;

Provided also that in the case of goods imported by air, where the cost referred to in clause (a) is ascertainable, such cost shall not exceed twenty per cent of free on board value of the goods:

Provided also that in the case of goods imported by sea or air and transshipped to another customs station in India, the cost of insurance, transport, loading, unloading, handling charges associated with such transshipment shall be excluded;

Explanation.-

The cost of transport of the imported goods referred to in clause (a) includes the ship demurrage charges on charted vessels, lighterage or barge charges.

(3) Additions to the price actually paid or payable shall be made under this rule on the basis of objective and quantifiable data.

(4) No addition shall be made to the price actually paid or payable in determining the value of the imported goods except as provided for in this rule.

Customs valuation adjustments to include transport and insurance to place of importation, with prescribed defaults and exclusions. Proposed amendments define the Place of Importation as the customs station for clearance or removal to a bonded warehouse and mandate inclusion in transaction value of transport, loading, unloading, handling and insurance costs to that place. The draft sets prescribed fallback mechanisms when transport, insurance or free on board values are not ascertainable, caps transport inclusion for air imports, excludes costs for transshipment, specifies transport includes demurrage and requires additions to be based on objective, quantifiable data.