TaxTMI 
TaxTMI 
Guidelines regarding Provisional Assessment under section 18 of the Customs Act, 1962
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....ween "provisional duty" and duty to be "finally assessed or re-assessed"; (b) execution of a bond; and (c) surety or security or both, as deemed fit. 2.1 Section 18 of the Customs Act, 1962 defines the cases where provisional assessment may be resorted, as under: - (1) Notwithstanding anything contained in this Act but without prejudice to the provisions of section 46,- (a) where the importer or exporter is unable to make self-assessment under sub-section (1) of section 17 and makes a request in writing to the proper officer for assessment; or (b) where the proper officer deems it necessary to subject any imported goods or export goods to any chemical or other test; or (c) where the importer or exporter has produced all the necessary documents and furnished full information but the proper officer deems it necessary to make further enquiry; or (d) where necessary documents have not been produced or information has not been furnished and the proper officer deems it necessary to make further enquiry, 2.2 Further, Section 18 goes on to state how a provisional assessment is to be carried out: "the proper officer may direct that the duty leviable on....
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....s "deemed fit" by the proper officer. For the sake of uniformity of practice, transparency and predictability for the tax payer, the Board has decided that the following procedure and guidelines will be followed by all Customs stations while assessing goods provisionally: 2.8 Wherever, duty is to be assessed provisionally, the importer shall: (a) for the purposes of undertaking to pay on demand the deficiency, if any, between the duty as may be finally assessed and the duty provisionally assessed, execute a bond in the prescribed form (enclosed); and (b) furnish such security for the payment of the duty deficiency, as indicated in para 3 below. 2.9 The security to be obtained shall be in the form of a bank guarantee or a cash deposit, as convenient to the importer. 3. The following guidelines shall be followed while obtaining security where provisional assessment under section 18 of the Customs Act is being undertaken: Sl. No. Class of Importer Amount of Bank Guarantee or Cash deposit to be obtained as "security "of the differential duty Remarks 1[1. Imports by Authorised Economic Operators (AEO - T3) 0 % (including cases at Sl. No. 4 to 6....
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.....2 It is also clarified that provisional assessments under section 18 are to be carried out with respect to cases where the duty is in dispute. Cases relating to execution of a bond or undertaking specified as a condition to a notification or those requiring compliance of conditions under allied acts are not to be provisionally assessed under section 18 of the Customs Act. This position had been earlier clarified by the Ministry of Law and Justice and circulated vide Ministry F.NO. 353 / 91 / 74 - Cus dated 28th January 1977. 4. Difficulties, if any, may be brought to the notice of the Board. 5. Hindi version follows. Yours faithfully, (S. Kumar) Commissioner (Customs) Encl: Format of bonds Bond Individual Importation (With Bank Guarantee or Cash Deposit) (To be executed by the Importer of goods with bank guarantee/cash deposit under section 18 of the Customs Act, 1962 (52 of 1962) (Circular No. 38 /2016-Customs dated 22/08/2016 issued from CBEC F.No: 465/01/2016 - cus V) KNOW ALL MEN BY THESE PRESENTS THAT We M/s ________________ having our registered office located at ________________________________and holding Import-Export Code No. _______________hereinafter called....
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....tral Government for the performance of an act which is in public interest. 2. The President through the [Deputy Commissioner / Assistant Commissioner of Customs] or other officer may recover the said sum of Rs_____in the manner laid down in Section 142 of the Customs Act, 1962 without prejudice to any other mode of recovery. IN WITNESS WHEREOF the importer has herein set and subscribed its hands and seals the day, month and year first above written. SIGNED AND DELIVERED by and on behalf of the importer at_______ (place) in the presence of:- (Signature of Authorised Signatory and Corporate Seal) Witnesses: 1 . 2. Accepted for and on behalf of the President of India (Signature of the Proper Officer) Schedule to Bond (Individual importation) (With Bank Guarantee or Cash Deposit) (To be executed by the Importer of goods with bank guarantee/cash deposit under section 18 of the Customs Act, 1962 (52 of 1962) (Circular No.38 /2016-Customs dated 22/08/2016 issued from CBEC F.No: 465/012016 - cus V) Bill of Entry Number Date Value at which provisionally assessed Bond value Details of security deposit or bank guarantee whichever is applicable Remarks (attach bank gu....
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....virtue. AND IT IS HEREBY AGREED AND DECLARED by the importer as follows:- This bond is given under the orders of the Central Government for the performance of an act which is in public interest. The President through the [Deputy Commissioner / Assistant Commissioner of Customs] or other officer may recover the said sum of Rs in the manner laid down in Section 142 of the Customs Act, 1962 without prejudice to any other mode of recovery. IN WITNESS WHEREOF the importer has herein set and subscribed its hands and seals the day, month and year first above written. SIGNED AND DELIVERED by and on behalf of the importer at (place) in the presence of:- (Signature of Authorised Signatory and Corporate Seal) Witnesses: 1 . 2. Accepted for and on behalf of the President of India (Signature of the Proper Officer) Schedule to Bond (Individual importation) (Without Bank Guarantee or Cash Deposit) (To be executed by the Importer of goods without bank guarantee/cash deposit under section 18 of the Customs Act, 1962 (52 of 1962) (Circular No. 38/2016 -Customs dated 22/08/2016 issued from CBEC F.No: 465/01/2016 - cus V) Bill of Entry Number Date Value at which Provisionally a....
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....extended period as the Proper Officer may allow, produce such documents and furnish such information as may be called for by the Proper Officer, and (2) If the importer pays to the President, the difference between the duty finally assessed and the duty provisionally assessed in respect of the goods imported from time to time and mentioned in the Schedule hereto annexed. Then the above written bond shall be void and of no effect; otherwise the same shall remain in full force and virtue. AND IT IS HEREBY AGREED AND DECLARED by the importer as follows:- 1. This bond and cash deposit/bank guarantee are given under the orders of the Central Government for the performance of an act which is in public interest. 2. The President through the [Deputy Commissioner / Assistant Commissioner of Customs] or other officer may recover the said sum of Rs______ in the manner laid down in Section 142 of the Customs Act, 1962 without prejudice to any other mode of recovery. 3. This bond and the cash deposit/bank guarantee shall remain in force from the date hereof and the obligation and liability of the importer shall be a continuing one in respect of all goods imported from time to time by the ....
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...._ WHEREAS the Assistant Commissioner of Customs/Deputy Commissioner of Customs at the ____________ (place), (hereinafter called the "proper officer") has agreed to make provisional assessment of the goods imported from time to time by us, pending submission of further documents and/or furnishing information and/or completion of further enquiries and/or chemical test and/or other test and the Proper Officer has agreed to allow provisional assessment of the goods mentioned in the schedule hereto annexed upon the importer agreeing to furnish such bond as is herein contained; and NOW THE CONDITION of the above written bond is such that - (1) If the importer shall within days or within such extended period as the Proper Officer may allow, produce such documents and furnish such information as may be called for by the Proper Officer, and (2) If the importer pays to the President, the difference between the duty finally assessed and the duty provisionally assessed in respect of the goods imported from time to time and mentioned in the Schedule hereto annexed. Then the above written bond shall be void and of no effect; otherwise the same shall remain in full force and virtue....