The Finance Minister had in her Budget Speech this year announced that the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 (IGCR, 2017) would be amended to boost trade facilitation. Accordingly, the Central Board of Customs and Indirect Taxes( CBIC) had immediately enhanced the scope of these rules on 2nd February 2021.
The CBIC has now issued a Circular No.10/2021-Customs, dated 17th May 2021 in order to assist the trade in understanding the improvements in the IGCR, 2017 so that they may make full use of the new facilities. Kindly click here to see the Circular
The IGCR, 2017 lay down the procedures and manner in which an importer can avail the benefit of a concessional Customs duty on import of goods required for domestic production of goods or providing services. One major change that accommodates the needs of trade and industry is that the imported goods have been permitted to be sent out for ‘job work’. The absence of this facility had earlier constrained the industry especially those in the MSME sector which did not have the complete manufacturing capability in-house.
Importantly, even importers who do not have any manufacturing facility can now avail the IGCR, 2017 to import goods at concessional Customs duty and get the final goods manufactured entirely on job work basis.However, some sectors such as gold, jewellery, precious stones and metals have been excluded.
Another major incentive now provided is to allow those who import capital goods at a concessional Customs duty to clear them in the domestic market on payment of duty and interest, at a depreciated value. This was not allowed earlier and manufacturers were stuck with the imported capital goods after having used them as they could not be easily re-exported.
Further, the procedure for availing the concessional Customs duty under these rules have been reviewed and rationalized. The required intimations and records can be sent by email to the jurisdictional Customs officer thereby obviating any physical interface.
The Government of India has reviewed the existing procedure of registration and approval of global manufacturers for importing oxygen cylinders and cryogenic tankers/ containers by Petroleum and Explosive Safety Organization (PESO). In view of the COVID pandemic, PESO shall not carry out physical inspection of global manufacturers’ production facilities before grant of such registration and approval. Now, such approvals shall be granted online without any delay on submission of manufacturer’s particulars; ISO certificate of manufacturer; List of Cylinders/ Tankers/Containers, their specifications, drawings & batch number; Hydro test certificate and Third party inspection Certificate. In case of any clarification, Mr. S.D. Mishra, Controller of Explosives, PESO (Mobile No. 9725850352, email Id email@example.com) and Dr. S.K.Singh, Controller of Explosives, PESO (Mobile No. 8447639102, email Id firstname.lastname@example.org) may be contacted.
In view of the COVID-19 pandemic, the Central Government has issued notifications exempting Basic Customs Duty and/or Health cess on imports of a number of COVID-19 related relief materials, for a limited period. These include–
27/2021-Customs dated 20.04.21 (as amended by notification No.29/2021-Customs dated 30.4.21)
Remdesivir injection/ API and Beta Cyclodextrin (SBEBCD), Inflammatory diagnostic (markers) kits, till 31st Octber,2021
28/2021-Customs dated 24.04.21
Medical grade Oxygen, oxygen therapy related equipment such as oxygen concentrators, cryogenic transport tanks, etc, and COVID-19 vaccines till 31st July, 2021
The Central Government had received a number of representations from charitable organizations, corporate entities, and other Associations/ entities outside India seeking exemption from IGST on the import of Covid-19 relief material (already exempted from customs duty), donated/received free of cost from outside India for free distribution. Accordingly, the Central Government has vide Ad hoc exemption Order number 4/2021 dated 3rd May, 2021 has granted exemption from IGST on import of such goods received free of cost for free distribution for covid relief.
This exemption shall apply till 30th June, 2021. It would also covers goods already imported but lying uncleared on the date of its issuance of exemptioni.e. today.
The exemption shall be subject to the following conditions:
State Government shall appoint a nodal authority in the State for the purpose of this exemption. As per section 2 (103) of the Central Goods and Services Tax Act, 2017, state include a Union territory with Legislature.
The Nodal authority so appointed shall authorise any entity, relief agency or statutory body, for free distribution of such Covid-relief material.
The said goods can be imported free of cost by a State Government or, any entity/ relief agency/ statutory body, authorized in this regard for free distribution anywhere in India.
The importer shall before clearance of goods from Customs produce a certificate from the said nodal authorities that goods are meant for free distribution for Covid relief.
After imports, the importer shall produce, to the Deputy or Assistant Commissioner of Customs at the port within a period of six months from the date of importation or within such extended period not exceeding nine months, a simple statement containing details of goods imported and distributed free of cost. This statement shall be certified by the said nodal authority of the State Government.
This exemption, shall thus enable import of the covid relief supply imported free of cost for free distribution without payment of IGST (upto the 30th June, 2021).
As customs duty is already exempt , these imports will not attract any customs duty or IGST.
RBI has issued a circular dated 22nd May, 2020 whereby they have allowed 12 months time for settlement of import payments as against the scheduled 6 months from the date of shipment. This applies to date of shipment made on or before 31st July, 2020. This is due to the Covid pandemic.
RBI has vide its notification dated 12th February, 2015 done away with the requirement of filling and submitting form 1 to the RBI for payment for imports into India exceeding US$5000. The onus is now on the Authorised Dealers to satisfy themselves about the bonafides of the transaction before effecting the remittance.
Hitherto, form 1 was required to be submitted to the authorised dealers for all import payments above US$5,000/-. This is a major step towards liberalisation of the documentary procedures.
The salient features of the said RBI circular is given below:
Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to theA.P.(DIR Series) Circular No. 82 dated February 21, 2012in terms of which applications by persons, firms and companies for making payments, exceeding USD 5,000 or its equivalent towards imports into India must be made in Form A-1.
To further liberalise and simplify the procedure, it has been decided to dispense with the requirement of submitting request in Form A-1 to the AD Category –I Banks for making payments towards imports into India. AD Category –I may however, need to obtain all the requisite details from the importers and satisfy itself about the bonafides of the transactions before effecting the remittance.