TAX AMICUS- NOV 2021

 

1. CUSTOMS NOTIFICATIONS

Import of goods originating from Sierra Leone will avail duty free tariff preference - Notification 50/2021-Customs dated 22.10.2021 has amended Notification No. 96/2008-Customs dated 13.08.2008 issued for duty free tariff preference for Least Developed Countries to include Sierra Leone as one of the Least Developed Countries. It implies that import of goods originating from Sierra Leone will avail duty free tariff concessions as per the amended Notification No. 96/2008-Customs dated 13.08.2008. [Notification No. 50/2021 Customs (T) dated 22.10.2021]

Reduction on Road and Infrastructure Cess on import of Petrol and Diesel - Notification No. 52/2021-Customs dated 03.11.2021 has amended Notification No. 18/2019-Cus. dated 06.07.2019 to reduce levy of Road and Infrastructure Cess on import of petrol by Rs. 5 per litre and diesel by Rs. 10 per litre with effect from 04.11.2021. [Notification No. 52/2021 Customs (T) dated 03.11.2021]

Introduction of provision of lifetime validity of registration and voluntary surrender of registration to an Authorised Courier - Notification Nos. 85 and 86 of 2021-Customs (N.T) dated 27.10.2021 have amended Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 and Courier Imports and Exports (Clearance) Regulations, 1998 respectively. Both the regulations have been amended to introduce new provision for lifetime validity to a registration of Authorised Courier. Further provision for voluntary surrender of registration has also been introduced in both the regulations. Newly inserted provisions further state that the registration would be deemed invalid if the registration is inactive for a period of one year, however, the same may be renewed by making an application before the Principal Commissioner or Commissioner of Customs, whosoever granted the registration to such Authorized Courier. [Notification Nos. 85 and 86 of 2021-Customs (N.T) dated 27.10.2021]

2. CUSTOMS CIRCULARS

Reducing compliance burden regarding registration of Authorised Couriers – To ease out the practice of Authorised Couriers getting registration at different Customs stations for transacting business, the CBIC has issued a circular clarifying that once registered at a particular Customs station, the Authorized Courier, for transacting business elsewhere, needs to only give appropriate intimation to the Principal Commissioner or Commissioner of Customs having jurisdiction over such other Customs station by way of furnishing bond/ security. The Board has instructed that duplication of multiple registrations need to be rationalized such that the first of such registrations is taken as the single registration and rest are regularized in terms of intimation procedure, without dislocating the normal business of the Authorized Couriers. Further the Board has also directed that apart from informing the Nodal Officer designated by DG Systems and DG ARM about the revocation of the registration of an Authorised Courier, practice of communicating such decisions to other Customs stations notified for courier operations should also be put in place. [Circular No. 24/2021-Customs dated 27.10.2021]

• 3. DGFT NOTIFICATIONS

Amendment in import policy condition of Urea [Exim Code 31021000] in the ITC (HS) 2017, Schedule-1 (Import Policy). In addition to Rashtriya Chemical & Fertilizers Limited (RCF), Import of Urea is allowed through National Fertilizers Limited (NFL) and Indian Potash Limited (IPL) subject to para 2.20 of Foreign Trade Policy, 2015-2020. The NFL and IPL are designated as STE for import of Urea on Government account. However, IPL is allowed to import Urea on government account till 31.03.2022 only. Henceforth, the MMTC and STC are de-notified as STE for import of Urea. [DGFT Notification No. 40/2015-20 dated 03.11.2021]

Amendment in Para 4.42(3) of Foreign Trade Policy 2015-20. Para 4.42(3) of  FTP 2015-20 stands amended to modify the name of the agency permitted to import diamonds to its laboratory for the purpose of certification/ grading & re-exports. [DGFT Notification No. 42/2015-20 dated 08.11.2021]

4. Public Notices

 

Allocation of quantity of 5841 MT (raw/refined) Sugar to EU under TRQ scheme for the year 2021-22: A quantity of 5841 MT (Raw and/or White Sugar) has been allocated under the Tariff Rate Quota (TRQ) for export to EU for the year 2021-22 (Upto September 30, 2022) [Public Notice No. 27/2015-20 dated 04.10.2021]

Allocation of quantity of 8424 MT (raw/refined) Sugar to USA under TRQ scheme for the year 2021-22: A quantity of 8424 MT (Raw and/or White Sugar) has been allocated under the Tariff Rate Quota (TRQ) for export to USA for the year 2021-22 (Upto September 30, 2022) [Public Notice No. 28/2015-20 dated 14.10.2021]

Amendment in Para 2.107 (TRQ under FTA/CECA) of Handbook of Procedure 2015-2020: Tariff rate quota quantity for items listed in Table 4 of Notification No.51/2021- Customs dated 22nd October , 2021 on India – Mauritius CECPA has been revised to 7000 tons combined for all goods containing description as “Tunas” , “Other” and “Other prepared or preserved fish” & 1.50 million litres combined for all goods having description as “Containers holding 2 Litres or less Rum” , “Other – Rum” and “Other – Other”. Also, the date for submission of online applications with DGFT has been extended from 31^st October,2021 to 31^st December,2021. [Public Notice No. 31/2015-20 dated 28.10.2021]

 Amendment in Para 2.76 of Handbook of Procedures (HBP) of the Foreign Trade Policy (FTP) 2015-20 regarding export of SCOMET items from DTA to SEZ/EOU and outside the country: Existing entry in para 2.76 of Handbook Procedures (HBP) of FTP (2015-20) relating to supply of Special Chemicals, Organisms, Materials, Equipment, and Technologies (SCOMET) items from DTA to SEZ has been amended and will now incorporate the word – EOU alongwith SEZ , thereby bringing out further clarity in relation to export policy of SCOMET items. [Public Notice No. 32/2015-20 dated 29.10.2021]

 

5. Trade Notices

 

Procedure and criteria for submission and approval of applications for export of Syringes (with or without needles): Month wise quota for export of syringes with or without needles has been fixed as 4 crores for November,2021, 9 crores for December,2021 and 9 crores for January,2022. Online Application for the above quantities is to be applied from 1st to 4th of every month through DGFT’s ECOM System for Export Authorizations (Non SCOMET Restricted items) [Trade Notice No. 20/2021-22 dated 05.10.2021]

6. CASE LAWS

Benefit of the Circular No. 02/2020-Cus. dated 10.01.2020 cannot be denied for EC/SHEC: The Hon’ble High Court observed that the Customs Department had come forward to take a stand that the mode of payment of the education cess even though being part of the customs duty, shall not be on the same line by using the MEIS scrip.  The Court held that such kind of payment could not be insisted upon, provided only in future cases and not in the cases where it has already been paid and where the goods have been cleared.  This was exactly made in execution by Circular No. 02/2020-Cus. dated 10.01.2020. In the above background, the Hon’ble Court held that the benefit of the Circular No. 02/2020-Cus. dated 10.01.2020 cannot be denied to the petitioner on the alleged reason that, the education cess or the higher and secondary education cess being a different component cannot be treated as customs duty or additional customs duty and therefore, the benefit conferred under Clause 11 of the said circular cannot be made available to the petitioner. [M/s. KTV Health Food Pvt. Ltd. vs. The Commissioner of Customs (Preventive), No. 1, Williams Road, Cantonment, Tiruchirapalli, 2021-TIOL-1941-HC-MAD-CUS]

Classification of screw/drag conveyors and bucket elevators under CTH 8437: The Hon’ble Tribunal held that 'screw/drag conveyors and bucket elevators’ is classifiable under CTH 8437 of Customs Tariff Act, 1975 and not under CTH 8428, as contended by the department as the goods are imported as parts of milling equipment. Relying on Annapurna Agronics Machinery Pvt. Ltd. 2018-TIOL-3986-CESTAT-CHD , the Hon’ble Tribunal held that impugned goods imported for specific use in milling factory merits classification under Heading 8437 and reliance by the department on the HSN Explanatory Notes, Chapter Heading 8437 which excludes machines used in milling industry to classify the goods under parts of lifts and escalators normally used in building industry was without any basis. [M/s. Chareon Pokphand India Pvt. Ltd. vs. Commissioner of Customs, 2021-TIOL-634-CESTAT-MAD]

No limitation period applicable for amendment of free shipping bills to drawback shipping bills. The Hon’ble Tribunal relying on the decision of Hewlett Packard Enterprise India Pvt. Ltd. v. Joint CC, 2020 (10) TMI 970- MAD HC observed that the only requirement for amendment of shipping bill under Section 149 of Customs Act, 962 is that the exporter must produce documentary evidence which was in existence at the time of export. [M/s. Autotech Industries (India) Pvt. Ltd. v. CC, Chennai IV Commissionerate, 2021 (11) TMI 518- CESTAT Chennai]

Deliberate suppression of facts is an essential requisite for invocation of extended period of limitation. The Hon’ble Tribunal relying on the decisions of Pushpam Pharamceuticals Co. v. CCEx, 1953 (3) TMI 100- SC and Easland Combines v. CCEx, Coimbatore, 2003 (1) TMI 107-SC reiterated that for invocation of extended period of limitation under Section 28(4) of Customs Act, 1962, positive act of fraud, collusion, willful misstatement, suppression of fact or contravention of any provision must be present. [M/s. Exclusive Motors Pvt. Ltd. v. CC (Preventive), 2021 (11) TMI 491- CESTAT ND]

Certificate of Country of Origin cannot be unilaterally rejected. The Hon’ble Tribunal held that the Country of Origin Certificates are considered as conclusive evidence towards the origin of goods when issued by the designated committee of the originating country. Hence, in the absence of material on record questioning their validity, such certificates are to be considered as substantive and conclusive evidence. Further, the Tribunal held that in the absence of enquiry by originating country or any confirmation towards overseas enquiry, the Country of Origin Certificates cannot be unilaterally cancelled. [M/s. So-Hum Trading Co. & Anr. v. CC (Preventive), Kolkata, 2021 (11) TMI 489- CESTAT Kol]

Dictum laid down in Dimension Data India Pvt. Ltd. v. CC must be followed. In this case, the assessee against the excess duty paid made an application for amendment of bill of entry. Aggrieved by the order of rejection for amendment, the assessee filed for correction of clerical errors under Section 154 of Custom Act, 1962. However, application under Section 154 of Customs Act was also rejected on the ground that it is a form of re-assessment only. The Hon’ble Tribunal taking into account the dictum of ITC Ltd. v. CCEx., 2019 (368) ELT 216 (SC) and Dimension Data (Supra), 2021-TIOL-224-HC-MUM-CUS directed the adjudicating authority to follow the directions laid down in Dimension Data (Supra) by the Hon’ble Bombay High Court. [M/s. Kluber Lubrication India Pvt. Ltd. v. CC (Air Cargo), Office of Principal Commissioner of Customs, Bangalore, 2021-VIL-633-CESTAT-BLR-CU]

Supreme Court decision in Canon India Pvt. Ltd. v. CC followed. Relying on the decision of Canon India Pvt. Ltd. (Supra) and recent decision of CC, Kandla v. M/s. Agarwal Metals & Alloys, 2021 (378) ELT 7 (SC), held that Additional Director General, (DRI) is not a proper officer to issue Show Cause Notice under Section 28(4) read with Section 124 of Customs Act. Hence, the proceedings initiated pursuant to the notice was set aside. [M/s. Sterling Meta Plast India Pvt. Ltd. v. CC (Airport & Administration), Kolkata, 20210VIL-631-CESTAT-Kol-CU]

Handling in the course of professional engagement does not imply knowledge for attracting penalty. The Hon’ble Tribunal relying on the decision of UPS Jetair Express Pvt. Ltd. v. CC, held that currency (prohibited goods) received by the bank as the recipient cannot be held liable for wrong declaration on the courier as the bank is merely recipient in the case. Hence, penalty imposed on the bank on the ground of mis-declaration was set aside. [Citibank NA v. CC (General), New Courier Terminal, IGI Airport, New Delhi, 2021-VIL-628-CESTAT-Del-CU]