Import Supply No. 19/2003
Export Supply No. 19/2003
Price Rs. 7.70
PUBLIC NOTICE NO. 54/2003 DATE : 20/05/2003
Guidelines for considering request for exemption from payment of customs duty under Section 25(2) of Customs Act, 1962.
Please find enclosed herewith a copy of CBEC Circular No. 18 of 2003 dated 24.03.2003 issued from F. No. 460/51/2002-Cus-V clarifying the issue cited above.
2. You are requested to give wide publicity to above clarification and inform you members.
(A. HUSSAIN)
COMMISSIONER OF CUSTOMS (IMPORT)
Encl : As above.
Issued from F. No. S/26-156/2003 A(G) Date : 14.05.2003
CIRCULAR NO. 18 OF.2003.
F.No.460/51/2002-Cus-V
GOVERNMENT OF INDIA
MINISTRY OF FINANCE & COMPANY AFFAIRS
DEPARTMENT OF REVENUE
(CENTRAL BOARD OF EXCISE & CUSTOMS)
New Delhi, dated 24th March, 2003.
OFFICE MEMORANDUM
Sub: Guidelines for considering request for exemption from payment of Customs duty under Section 25(2) of Customs Act, 1962.
I am directed to refer to this Department’s Office Memorandum F.No. 467/104/2001- Cus-v dated 12th December, 2001 (Circular No. 81 of 2001) wherein guidelines for considering requests for ad-hoc exemption from payment of custom duty under Section 25(2) of the Customs Act, 1962 have been issued. It has generally been observed that th4e importers are not aware of the correct procedure for seeking ad-hoc exemption as also the details of the documents/information that for seeking ad-hoc exemption as also the details of the documents/information that are required to be submitted along with the request. The importers invariably approach this Ministry only after the goods have arrived at the port of import resulting in payment of heavy demurrage charges.
2. The matter has been examined. It has now been decided that importers, desirous of seeking ad-hoc exemption under Section 25(2) of Customs Act, 1962, may also apply to the concerned Commissioner of Customs at the port of import. The Commissioner of Customs will forward such requests to the Board along with the documents mentioned in Annexure II of this circular and his comments regarding the charitable nature of the applicant institution, the nature of its activities, reputation, etc. The Commissioner may also recommend whether provisional clearance should be considered.
3. These guidelines may be brought to the notice of all concerned by way of Public Notice.
4. Circular No. 81 of 2001 referred to above and a list of documents that are to be submitted along with the request for ad-hoc exemption are enclosed as Annexure I & II respectively.
(N.J.KUMARESH)
Under Secretary to the Government of India.
Copy to:
1. All Ministries/Departments of thhe Government of India.
2. UPSC/CVL/C&AG Commissioner of Linguistic Minorities/Commissioner for SC/ST, Backward Classes Commission, Minority Commission, Prime Minister’s Office, Lok Sabha Secretariat, Rajya Sabha Secretariat, President’s Secretariat, Vice-President Secretariat, Supreme Court, High Court, Central Administrative Tribunal.
3. All Sections of C.B.E.C./C.B.D.T. & subordinate offices of Ministry of Finance, Department of Revenue.
4. All Chief Commissioners/Commissioners of Customs/Customs and Central Excise/Customs Preventive/CEIB/DRI.
(N.J. KUMARSH)
Under Secretary to the Governement of India.
CIRCULAR No. 18 of 2003.
F.No. 467/104/2001-Cus-V
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
New Delhi, Dated 12th December, 2001.
OFFICE MEMORANDUM
Subject: EXEMPTION FROM CUSTOMS DUTY UNDER SECTION 25(2) OF THE CUTOMS ACT, 1962- GUIDELINES FOR CONSIDERATION OF REQUESTS IN THE MATTER.
In supersession of this Department’s Office Memorandum F.No.467/41/99-Cus-V dated June 18th,1999 on the subject, the guidelines as mentioned in the fo0llowing paragraphs are being issued with approval of the Hon’ble Finance Minister. They may be, with immediate effect, taken in to account at the time of consideration of any application for request for exemption from Customs duty under Section 25(2) of the Customs Act, 1962.
2. The provisions of Section 25(2) of the Customs Act for exemption from Customs duty are applicable in respect of goods, which are of secret or strategic nature or are meant for being used for charitable purposes.
3. For the purpose of availment of exemption of Customs duty under the above-mentioned provisions of the Customs Act, the following categories of goods would be treated to be of secret or strategic nature:
(a) Imports of secret goods by the Government with a view to meet security requirements of the country;
(b) Imports to meet country’s defence needs relating to requirements of armed forces. This would also include goods meant for R & D units under the DRDO. It is made clear that exemption under this category is not meant for imports which are of routine or frequent nature of are to meet the normal operational requirements of the armed forces.
(c) Imports by Government Organisations engaged in security operations like Special Protection Group (SPG) and other Central Police Organisations; and State Police Organisations, for equipping their forces. It is clarified that security forces are expected to make budgetary provisions for importing their equipments, and there should be no need to seek ad-hoc exemption from payment of Customs duty in the routine course. They should provide for payment of duty along with payment of price of the goods. No exemption will be given to goods which are required to meet the normal functional requirement of these organizations and which are in the nature of routine imports. Exemption is also not available to items like spare parts, which are required for repair and maintenance of equipments of these organizations. Only in situations of exceptional nature particularly, in view of the security considerations, application for availment of ad-hoc exemption under this category should be made. However, the applicant organization should clarify why, in respect of even these goods, budgetary allocation for duty could not be made.
(d) Applications to be made for availment of Customs duty in the category © above, must be forwarded by an officer not below the rank of concerned Joint Secretary to Government of India in the concerned administrative Ministry.
4. Exemption of duty on goods meant for charitable purposes would be applicable in respect of import of such goods by charitable institutions, which are to be used for charitable purposes without any distinction in any manner on account of caste, creed, religion, race or gender.
5. The imports by charitable institutions would be required to fulfill the following conditions to be eligible for exemption under the category:
(a) The imports would normally be received as donations or gifts from foreign countries from known institutions and not from individuals.
(b) Either there would be no payment involved for the imported goods or the payment should be made only out of the amount received as donation within India.
(c) The applicant of exemption under this category should also be an institution/organisation registered as a charitable organisation The applicant should not be an individual. Further, the institutions should have been providing charitable service for not less than three years at the time of making application for exemption, and it should be enjoying good reputation.
(d) The applicant institution should not be such whose activities are purely or mainly religious in nature such as propagation or promotion of a particular religion.
(e) For the availment of exemption, it would be necessary that the institution is engaged in rendering charitable service to the society at large, e.g. running hospitals, educational institutions etc. Either service being so rendered by the institution should be running, on ‘no profit no loss’ and this fact should be reflected in the annual account of the institution. The activity of institution should not be commercial in nature.
(f) The charitable nature of the institution, the fact of it rendering services on ‘free’ or ‘no loss no profit’ basis, it having been in existence for not less than three years and that it enjoys good reputation should be certified by any of the following authorities:
I. Jurisdictional Commissioner of Central Excise/Customs.
II. Jurisdictional Commissioner of the State Government.
III. Concerned Secretary of the State Government.
IV. Concerned Joint Secretary of the Central Government.
(g) Exemption under this category would not be admissible on items, which are of general use and operational equipments like construction materials, vehicles, air conditioners, refrigeration and chilling equipments, curtains, furniture, audio video systems, computers and accessories, office stationery, etc. since, they are generally not meant for providing any specific/direct charitable service. The exclusion would also cover items that are likely to serve more of a cultural purpose such as musical instruments etc. Exemption will also not be allowed to items, which are in the nature of spares required for maintenance and repair of existing equipment.
(h) The institution should certify that the goods under import are for its own use and should furnish an undertaking to the effect that they would fulfill the conditions prescribed for availment of exemption.
(i) No preferential treatment in the matter of granting exemption under this category would be given to any government organisation. The element of Customs duty should invariably form part of the cost of projects undertaken by the Government Organisaitons.
(j) Monitoring of Ad-hoc Exemption Orders (AEO): The concerned Commissioner of Customs and Central Excise under whose jurisdiction the registered office of the charitable organisation in situated shall monitor the utilization of the items imported under the AEO by the importing charitable organisation. For this purpose, the charitable organisation availing the exemption shall also be required to intimate to the jurisdictional Commissioner within one month of their receiving the AEO, details of their address and the proposed site of utilization of the exempted items, along with any other information that the Commissioner to the Commissionerate may require for verifying compliance of the conditions of the AEO. A report in this regard should then be sent by the jurisdictional Commissioner to the Commissioner of Customs of the port of clearance of the goods within 3 months of the import of the goods. Since, the conditions of the AEO are binding on the importer in perpetuity, any infringement of conditions of the AEO should be brought to the notice of the Commissioner of Customs of the port of import for taking further necessary action such as realization of Customs duty on the subject goods, penal action for such violations, etc., the action as above taken by the Commissioner of Customs of the port of import should be intimated to the Board.
6. All ad-hoc exemptions from duty to non-governmental organisation will be issued subject to the conditions that the imported goods will not be put to any commercial use and will not be sold, gifted or parted by the importer in any manner without the prior permission of the Board. The imported goods will be kept available for inspection by jurisdictional Customs or Central Excise Officers.
7. Import of goods which are not covered in any of the categories mentioned in para-2 will not be considered for granted of ad-hoc exemption under Section 25(2) of the Customs Act, 1962.
8. Ministries/Departments may please bring these guidelines to the notice of all concerned, and direct them to submit their requests for Customs duty exemption in accordance with the afore-mentioned guidelines.
(RIMJHIM PRASAD)
Under Secretary To The Government of India
1. All Mnistries/Departments of the Government of India.
2. UPSC/CVL/C&AG/ Commissioner of Linguistic Minorities/ Commissioner of r SC/ST Backward Classes Commissioner, Minority Commission, Prime Minister’s Office, Lok Sabha Secretariat, Rajya Sabha Secretariat, President’s Secretariat, Vice President’s Secretariat, Supreme Court, High Court, Central Administrative Tribunal.
3. All Sections of C.B.E.C./C.B.D.T. & attached and subordinate offices of Ministry of Finance, Department of Revenue.
4. All Commissioners of Customs/Customs and Central Excise/ Customs Preventive/CEIB/DRI.
(RIMJHIM PRASAD)
Under Secretary To The Government of India
LIST OF DOCUMENTS TO BE SUBMITTED ALONG WITH REQUEST
FOR AD-HOC EXEMPTION FROM PAYMENT OF CUSTOMS DUTY.
V. ESSENTIAL DOCUMENTS.
1. Memorandum of Association.
2. Registration certificate as a charitable society under Societies Registration Act, 1860.
3. Audited income and expenditure account statement (including FCRA if applicable) for the last three years;
4. The charitable nature of the institution, the fact of it rendering services on “free” or “no loss no profit” basis, it having been in existence for not less than three yars and that it enjots good reputation should be certified by the Secretary of the concerned administrative ministry in the State Government (of the rank of Joint Secretary in Government of India) or by the Commissioner of Central Excise having jurisdiction over the importer.
5. attested copy of Income Tax Exemption Certificate;
VI. ADDITIONAL DOCUMENTS
1. Details of goods along with Donor’s letter, Bill of Entry (in case imports have a (ready been made), Port of Import, Proforma Invoice, exact amount customs duty involved.
2. Reasons as to why Customs duty cannot be paid out of the funds available;
3. Donor’s letter and relationship with donor (in case of gifted/donated goods), whether the donor is institute/society/foundation. If yes, give details of donor; if goods are purchased from abroad, then details of donated funds from which such purchase has been made;
4. Attested copy of Bill of Entry- in case of imports already made.;
5. If medical institute, to what extent free service has been rendered, number of patients during the preceding one year (outpatients/inpatients), who is the controlling authority, whether recognized by State Government;
Presented by eximkey.com