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  7. Valuation
  8. Procedure for Import & Export
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  10. Drawback
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  12. Prosecution
LAW & PROCEDURES

The concept

Customs duty is a tax which the State collects on goods imported into or exported out of the boundaries of a country. Customs duties now form a significant source of revenue for all countries, more so in the case of developing countries like India.

The levy

In India, customs duties are levied on the goods and at the rates specified in the Schedules to the Customs Tariff Act, 1975. The taxable event is import into export from India. Export duties are practically non-existent at present. They are levied occasionally to mop up excess profitability in international price of goods in respect of which domestic prices may be low at given time. But sweep of import duties is very wide, almost universal, barring a few goods like food grains, fertilizer, life saving drugs and equipments etc. Import duties generally consist of the following:

  1. Basic duty. It may be at the standard rate or, in the case of import from some countries, at the preferential rate.
  2. Additional customs duty equal to central excise duty leviable on like goods produced or manufactured in India. It is commonly referred to as countervailing duty or C.V.D.
  3. Special additional duty of Customs at the rate of 4% in order to provide a level playing field to indigenous goods which have to bear sales tax. This duty is to computed on the aggregate of
    • assessable value;
    • basic duty of Customs;
    • surcharge; and
    • additional duty of Customs leviable under section 3 of the Customs Tariff Act, 1975 (c.v.d.)

  4. Additional duty of Customs at the rate of Re. 1/- per liter on imported motor spirit (petrol) and high speed diesel oil.
  5. Anti-dumping duty/Safeguard duty for import to specified goods with a view to protecting domestic industry from unfair injury.
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