TaxTMI 
TaxTMI 
Important changes in Customs Act, 1962 and rates of duty as proposed through the Finance Bill, 2018
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.... of Customs leviable on goods specified in the Second Schedule to the Customs Tariff Act, 1975. c) Clause 101 (a) of the Finance Bill, 2018 seeks to amend the First Schedule of the Customs Tariff Act, 1975 so as to increase Tariff rate of Basic Customs Duty on certain goods. d) Clause 102 (b) of the Finance Bill, 2018 seeks to amend the Second Schedule of the Customs Tariff Act, 1975 so as to prescribe rate of Export Duty on certain goods. These increases will come into effect immediately [from 00 hours on 02.02.2018 owing to a declaration under the Provisional Collection of Taxes Act, 1931. Chapter 1 to 7: No change Chapter 8: 1) BCD on cashew nuts in shell (raw cashew) falling under tariff item 0801 31 00 is being reduced from 5% to 2.5%. S. No.22 of notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018-Customs, dated 2^nd February 2018 refers. Chapter 9 to 14: No change Chapter 15: 1) BCD on crude edible vegetable oils like Ground nut oil, Olive oil, Cotton seed oil, Safflower seed oil, Saffola oil, Coconut oil, Palm Kemel/ Babassu oil, Linseed oil, Maize corn oil, Castor oil, Sesame oil, ot....
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....t commonly known as petrol and high speed diesel oil falling under heading 2710, Clause 109 read with the Sixth Schedule of the Finance Bill, 2018 refers. This levy of Road and Infrastructure Cess will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. 2) Simultaneously, the Additional Duty of Customs leviable (CVD) under section 3(1) of the Customs Tariff Act, 1975 in lieu of Additional Duty of Excise (Road and Infrastructure Cess) leviable under clause 110 of the Finance Bill, 2018 is being exempted on imported motor spirit commonly known as petrol and high speed diesel oil vide notification No. 21/2018-Customs dated 02.02.2018. 1) Further, the Additional Duty of Customs (Road Cess), at the rate of Rs. 6 Per litre, leviable on imported motor spirit commonly known as petrol and high speed diesel oil, are being abolished, by omitting the relevant sections in Finance (No.2) Act, 1998 and Finance Act, 1999, respectively. [Clause 106 of the Finance Bill, 2018 refers]. Till the enactment of the Finance Bill, 2018, the Additional Duty of Customs (Road Cess) leviable on imported motor spirit commonly known as petrol ....
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....eading 34o6 is being increased from 10%" to 25% by increasing the tariff rate. [Clause 101 (a) of the Finance Bill, 2018 refers]. Chapter 35-38: No Change Chapter 39: l) BCD on specified parts or sub-parts or accessories of cellular mobile phones, namely, Heat Dissipation Sticker Battery Cover, Sticker-Battery Slot, Protective Film for main Lens, Mylar for LCD FPC, Film-Front Flash, falling under tariff item 3919 90 90, is being increased from 10% to 15% by increasing the tariff rate [Clause 101 (a) of the Finance Bill, 2018 refers]. However, BCD on goods, other than these specified parts or sub-parts or accessories of cellular mobile phones, falling under tariff item 3919 90 90 is being retained at 10%. Notification No.57/2017-Customs, dated 30^th June, 2017, as amended by notification No.22/2018-Customs, dated 2nd February, 2018 [new S. No. 9 refers]. 2) BCD on specified parts or sub-parts or accessories of cellular mobile phones, namely, Battery Cover, Front Cover, Front Cover (with Zinc Casting), Middle Cover, Back Cover, Main Lens, Camera Lens, falling under tariff item 3920 99 99, is being increased from 10% to 15% by increasing the tariff rate. [Claus....
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....ng Diode (LED) TV panels will attract 10% BCD at the tariff rate, without any actual user condition 3) BCD on Microphone Rubber Case, Sensor Rubber Case / Sealing Gasket including sealing gaskets / cases from Rubbers like SBR, EPDM, CR, CS, Silicone and all other individual rubbers or combination / combination of rubbers for use in the manufacture of cellular mobile phones, falling under tariff item 4016 99 90, is being increased from 10% to 15%. S. No. I of notification No.57/2017-Customs, dated 30^th June, 2017, as amended by notification No.22/2018-Customs, dated 2^nd February, 2018 and S. No 284 of notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018 Customs, dated 2^nd February, 2018 refer. Chapter 41-47: No Change Chapter 48: 1) BCD on kites falling under tariff item 4823 90 90 is being increased from 10% to 20% by increasing the tariff rate. [Clause 101 (a) of the Finance Bill, 2018 refers]. However, BCD on all goods other than kites, falling under tariff item 4823 90 90, is being retained at 10%. Notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018-Customs, dated 2^nd....
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....ustoms, dated 2nd February, 2018 refers. Chapter 70: l) BCD on solar tempered glass or solar tempered (anti-reflective coated) glass for manufacture of Solar cells/panels/modules, is being reduced from 5% to Nil, subject to actual user condition. S. No. 340 of notification No.50/2017-Customs, dated 30th June, 2017, as amended by notification No. 6/2018-Customs, dated 2nd February, 2018 refers. 2) BCD on Preform of Silica for use in the manufacture of telecommunication grade optical fibres or optical fibre cables is being increased from Nil to 5%, subject to actual user condition. S. No.341 of notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018-Customs, dated 2nd February, 2018 refers. Chapter 71: l) BCD on cut and polished coloured gemstones falling under chapter 71 is being increased from 2.5% to 5%. S.No.349 of notification No.-50/2017-customs, dated 30^th June, 2017, as amended by notification No. 6/2018-customs, dated 2nd February, 2018 refers. 2) BCD on diamonds including lab grown diamonds-semi processed, half-cut or broken falling under chapter 71 is being increased from 2.5% to 5%. S.No.350....
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....711, is being increased from 7.5% to 15% by increasing the tariff rate. [Clause 101 (a) of the Finance Bill, 2018 refers]. However, the existing BCD rates/concession rates on engines of aircraft (8407 10 00), marine propulsion engines (8407 21 00 and 8407 29 00), or engines of motor vehicles [other than motor vehicles falling under headings 8702,8703, 8704 or 8711] shall continue [New S. Nos. 447 A and 448 B of notification No. 50/2017-Cus, dated the 30th June, 2017, as amended by notification No.6 /2018-cus, dated 2nd February, 2018, and other existing entries in the notification No. 50/2017-Cus refer]. 2) BCD on compression ignition engines, falling under heading 84o8, of motor vehicles falling under headings 8702, 8708,8704 or 8711, is being increased from 7.5% to 15% by increasing the tariff rate. [Clause 101(a) of the Finance Bill, 2018 refers]. However, the existing rates of 7.5% of BCD on all goods [other than the engines of motor vehicle falling under headings 8702, 8703, 8704 or 8711] shall continue [New S. Nos. 448 C of notification No. 50/2017-Cus, dated the 30th June, 2017, as amended by notification No. 6/2018-Cus, dated 2nd February, 2018 refers]. 3)....
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....ariff rate. [Clause 101(a) of the Finance Bill, 2018 refers]. However, BCD on goods other than charger or adapter of cellular mobile phones, falling under sub-heading 8504 40, is being retained at 10%. Notification No.57/2017-Customs, dated 30^th June, 2017, as amended by notification No.22/2018-Customs, dated 2nd February, 2018 [new S. No. 13 refers]. 8) BCD on cell/battery of cellular mobile phones is being increased from 10% to 15% by increasing the tariff rate on goods falling under heading 8506 (other than tariff item 8506 90 00). [Clause 101(a) of the Finance Bill, 2018 refers]. Further, effective rate of BCD on goods [other than cell/battery of cellular mobile phones], falling under heading 8506, is being retained at 10%. Notification No.57/2017-Customs, dated 30^th June, 2017, as amended by notification No.22/2018-Customs, dated 2nd February, 2018 [new S. Nos. 14 refer]. 9) BCD on battery pack [other than Lithium-ion battery] of cellular mobile phones is being increased from 10% to 15% by increasing the tariff rate on goods falling under heading 8507 (other than tariff item 8507 60 00 and sub-heading 8507 90). [Clause 101(a) of the Finance Bill, 2018 refer....
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.... June, 2017, as amended by notification No.22/2018-custoris, dated 2nd February, 2018 [new S. No. 19 refers]. 14) BCD on USB cable of cellular mobile phones, falling under heading 8544, is being increased from 7.5/10% to 15% by increasing the tariff rate on goods falling under tariff item/subheadings 8544 19 10, 8544 19 20, 8544 19 30, 8544 19 90, 8544 49 from to and tariff rate of items falling under 8544 42 91, 8544 42 92, 8544 42 93, 8544 42 99 from 7.5% to 15%. [clause 101(a) of the Finance Bill. 2018 refers]. However, the effective rate of BCD on goods [other than USB cable of cellular mobile phones], failing under heading 8544 is being retained at 7.5%. S. No.491 of notification No.50/2017-customs, dated 30^th June, 2017, amended by notification No. 6/2018-customs, dated 2nd February, 2018 refers. 15) BCD on wrist wearable devices (commonly known as smart watches) falling under tariff item 8517 62 90 is being increased from 10% to 20% by increasing the tariff rate. [Clause 101(a) of the Finance Bill, 2018 refers]. However, the effective rate-of BCD on goods [other than wrist wearable devices], falling under tariff item 8517 62 90, is being retained ....
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....cation No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018-Customs, dated 2nd February, 2018 [new S. Nos. 516.A refers]. 21) BCD on parts of other cathode ray tube monitors; other monitors; other projectors; reception apparatus for television, whether or not incorporating radiobroadcast receivers or sound or video recording or reproducing apparatus, not designed to incorporate a video display or screen and other Monochrome of heading 8528, falling under tariff items 8529 10 99 or 8529 90 90, is being retained at 1o%. Notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No.6/2018-Customs, dated 2nd February, 2018 [new S. No. 516B refers]. 22) BCD on r specified parts of Liquid Crystal Display (LCD) and Light Emitting Diode (LED) TV panels is being increased from Nil to 10%. S. No. 516 of notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018-Customs, dated 2nd February, 2018 refers. 23) Concessional 2.5% BCD is being extended to Ball Screws [8483 40 00], Linear Motion Guides [8466 93 90] and CNC Systems [8537 10 00] for manufacture of all types of CNC machi....
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.... BCD on CKD (completely knocked down) imports (with engine, gearbox and transmission not in pre-assembled condition) of motor cycles falling under heading 8711, is being increased from 10% to 15% [S. No. 531 of notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018-customs, dated 2nd February, 2018 refers] . 6) BCD on parts and accessories, faring under sub-heading 8714 10, of motor cycles (including mopeds) falling under heading 8711, is being increased from 10% to 15%, by increasing the tariff rate [Clause 101(a) of the Finance Bill, 2018 refers]. Chapter 88-89: No Change Chapter 90 l) BCD on medical devices falling under headings 9018, 9019, 9020, 9021 or 9022 is being increased from 7.5% to 10% by increasing the tariff rate. [Clause 101(a) of the Finance Bill, 2018 refers]. There is, however, no change in effective rates of BCD on medical devices falling under headings 9018, 9019, 902o, 9021 or 9022. For example, medical devices [falling under tariff lines 9018 32 30, 9018 50 20, 9018 90 21, 9018 90 24, 9018 90 43, 9018 90 95, 9018 90 96, 9018 90 97, 9018 90 98, 9019 10 20, 9022 90 10 or 9022 90 30 will continue to....
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....18 refers]. 4) BCD on all goods (other than solar lantern or solar lamps) falling under chapter heading 94o5 is being increased from 10% to 20%. S.No.586A of notification No.50/2017-customs, dated 30^th June, 2017, is being omitted by notification No.6/2018-customs, dated 2nd February, 2018. consequently, all goods, except solar lantern or solar lamps falling under heading 9405 will attract 20% tariff rate. Chapter 95: 1) BCD on all goods falling under heading 9503 (goods falling under tariff item 9503 00 90 is already at 20%) is being increased from 10% to 20% by increasing the tariff rate. [Clause 101(a) of the Finance Bill, 2018 refers]. With this change, all goods falling under heading 9503 will attract BCD of 20% (Balloons falling under this heading already attract 20% BCD). S. No. 284 of notification No.50/2017-Customs, dated 30^th June, 2017, as amended by notification No. 6/2018-Customs, dated 2^nd February, 2018 refers 2) BCD on all goods falling under heading 9504 is being increased from 10% to 20% by increasing the tariff rate. [Clause 101 (a) of the Finance Bill, 2018 refers]. 3) BCD on all goods falling under tariff item 9505 90 1....
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....s are being abolished by omitting Chapter VI in Finance (No.2) Act, 2004 and Finance Act, 2007, respectively. [Clause106 of the Finance Bill refers]. Till the enactment of the Finance Bill, 2018, Education Cess and Secondary & Higher Education Cess leviable on imported goods are being fully exempted by way of notification. [Notification Nos. 7/2018-Customs and 8/2018-Customs dated 02.02.2018 refer] Consequently, Notification Nos. 69/2004-Customs dated 09.07.2004 and 28/2007-Customs dated 1^st March 2007 exempting specified goods from levy of Education cess and SHE cess are being rescinded vide notification Nos. 9/2018 Customs and 10/2018-Customs dated 02.02.2018. 3) specified goods, which were exempt from levy of Education cess and SHE cess under notification Nos. 69/2004-Customs dated 09.27.2004 and 28/2007-Customs dated I^st March 2007 respectively, are being fully exempted from the levy of Social Welfare Surcharge. Notification No. 11/2018-Customs dated 02.02.2018 refers]. 4) Levy of Social Welfare Surcharge on Integrated Tax and GST Compensation Cess on imported goods is being fully exempted by way of notification. Notification No. 13/2018 Customs dated 02.02.....
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....exceptions, modifications or adaptations as the Central Government may deem fit. This change would come into force from a date to be notified. [57] 5. Section 17 is being amended so as to: (a) expand the scope of verification beyond self-assessment to all the entries made under section 46 or section 5o by amending sub-section (2) along with consequential changes in subsection (3); (b) insert a new sub-section (2A) to provide legal backing for the risk-based selection of self-assessed Bill of Entry or Shipping Bill through appropriate selection criteria; (c) extend the scope of re-assessment by omitting specific reference to valuation, classification and exemption or concessions of duty availed consequent to any notification issued therefore under this Act from subsection (5); (d) omit sub-section (6), in view of the new dedicated for Audit; [58] 6. Section 18 is being amended so as to: (a) cover export consignments under provisional assessment of duty b amending sub-section (1); (b) insert a new sub-section (IA) to empower the Board to issue regulation for providing time-limit for the importer or expor....
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....ate of notice, but from the date when such reasons cease to exist. (e) insert a new sub-section (10A) to provide that where an order for refund is modified in appeal and the amount of refund so determined is less than the amount refunded, the excess amount so refunded shall be recovered along with interest thereon at the applicable rate, from the date of refund up to the date of recovery, as a sum due to the Government. (d) insert a new sub-section (10B) to provide a safeguard whereby a demand notice issued under sub-section (4) is held not sustainable in any proceeding including at any stage of appeal for the reason that the charges of collusion, wilful misstatement etc. have not been established against the person to whom the demand notice has been issued, then the said notice shall be deemed to have been issued under sub-section(1). (e) insert an explanation that a notice issued for non-levy, not paid, short-levy or short paid of duty or erroneous refund after 14^th May, 2015 but before the date on which the finance. Bill, 2018 receives the assent of the resident, shall continue to be governed by the provisions of section 28 as it stood immediately bef....
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....n sub-section (l); (b) insert a proviso to sub-section (1) so as to add a corresponding proviso to sub-section (7) of section 28 stating that the period beginning with the date of such advance ruling and ending with the date of order under this sub-section shall be excluded from the time period of two years and five years respectively specified in section 28EA. [67] 16. A new section 28KA [relating to Appeal provisions in respect of Advance Ruling] is being inserted so as to- (a) provide for appeal by an officer duly authorized by Board by notification, or by an applicant against the ruling or an order passed by Customs Authority for Advance Rulings to the Appellate Authority constituted under Section 245-0 of the Income Tax Act; (b) provide that the sections 281 and 28J shall apply mutatis mutandis to appeal proceedings. (c) provide that the changes inserted vide this section shall come into force only when customs authority for advance ruling is appointed under section 28EA. [68] 17. Section 28L is being amended so as to substitute the word "Authority" with the words "Authority or Appellate Authority" [69] 18. Section....
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....ence to Customs Automated System and the manner of presentation of shipping bill or bill of export; (b) amend the proviso to sub-section (1) to insert a reference to Customs Automated System; and (c) insert a new sub-section (2A) so as to provide for observance of the accuracy, authenticity, validity of the declarations made by the exporter under this section and compliance to the prohibitions or restrictions under this act or any other law for the time being in force. [76] 25. Section 51 is being amended so as to have a provision for clearance of goods by Customs Automated System in addition to existing clearance by the proper officer. [77] 26. To insert Chapter VIIA on payments through electronic cash ledger with governing provisions, in Section 5 IA to have a provision for advance deposit which would enable payment of duties, taxes, fee, interest, and penalty through electronic cash ledger. [78] 27. Section 54 is being amended so as to empower the Board to make Regulations provide manner of presenting a bill of transshipment and declaration for transshipment. [79] 28. Section 60 is being amended so as to have a provision for ....
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....ay, for reasons to be recorded in writing, extend the six months period by a period not exceeding six months and inform the person from whom such goods have been seized before the expiry of the time mentioned in the said sub-section; (b) insert second proviso to sub-section (2) providing that where any order for provisional release of the seized goods has been passed under Section 110A, the aforesaid period of six months, mentioned in sub-section (2), shall not apply. [90] 39. Section 122 is being amended so as to substitute the existing clauses (b) and (c) to empower the Board to fix monetary limits for adjudication of cases by officers below the rank of Joint Commissioner by way of notification. [91] 40. Section 124 is being amended so as to insert a second proviso to provide for issuance of supplementary show cause notice under such circumstances and in such manner as may be prescribed through regulations.; [92] 41. Section 125 of the Customs Act is being amended so as to: (a) insert a proviso to sub-section (1) to provide that where the demand proceedings against a notice / co- notices have been closed on grounds of having paid the dues menti....
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....rade facilitation, effective risk analysis, verification of compliance and prevention, combating and investigation of offences under the provisions of this Act or under the corresponding laws in force in that country; (b) authorize the Central Government to provide by a notification that the application of this section in relation to a contracting state with which reciprocal agreement or arrangements have been made, shall be subject to such conditions, exceptions or qualifications as are specified in the said notification.; (c) utilize the information received under sub-section (1) as evidence in investigations and proceedings under this Act subject to provisions of sub-section (2).; (d) where the Central Government has entered in to a multilateral agreement for exchange of information or documents for purposes of verification of compliance in identified cases, the Board shall specify the procedure for such exchange, the conditions subject to which such exchange shall be made and designation of the person through whom such information shall be exchanged; (e) insert a deeming provision that any agreement entered into or any other arrangement made ....