BUDGETARY AMENDMENT TO CUSTOMS (IMPORT OF GOODS AT CONCESSIONAL RATE OF DUTY) RULES, 2017

[Mr. M. GOVINDARAJAN]

Vide Notification No. 07/2022-Customs (NT), dated 01.02.2022 the Central Government amended the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017.  These rules are called as Customs (Import of Goods at Concessional Rate of Duty) Amendment Rules, 2022 which will come into effect from 01.03.2022.

Amendment to Rule 4

Rule 4 provides for furnishing of information by the importer.  The said Rule is substituted by a new Rule. 

One time information

The newly substituted Rule 4(1) provides that the importer shall provide one-time information on the common portal in Form IGCR-1 (Import of Goods at Concessional Rate of Duty).  The expression ‘Common portal’ is defined by newly inserted Rule 3(ab) as the common customs electronic portal as referred to in section 154C of the Act.

Contents of Form ICGR  - 1

 In Form ICGR -1 the following particulars are to be furnished-

• the name and address of the importer and his job worker, if any;
• the goods produced or process undertaken at the manufacturing facility of the importer or his job worker, if any, or both;
• the nature and description of goods imported used in the manufacture of goods at the premises of the importer or the job worker, if any;
• particulars of the exemption notification applicable on such import ;
• nature of output service rendered utilizing the goods imported; and
•  the intended port(s) of import.

Previous to this amendment information is required to be furnished to jurisdictional Assistant Commissioner.

Import of Goods at Concessional Rate Identification Number (IIN)

Rule 4(2) provides that on acceptance of the above information an IIN will be generated against such information furnished.  Such information may be updated on the common portal in case of a change in the details furnished in such Form.

Bond

Rule 4(3) provides that the importer who intends to avail the benefit of an exemption notification shall submit a continuity bond with such surety or security as deemed appropriate by the Deputy Commissioner of Customs or the Assistant Commissioner of Customs, having jurisdiction over the premises where the goods imported shall be put to use for manufacture of goods or for rendering output service.  The importer shall give an undertaking to pay the amount equal to the difference between the duty leviable on inputs but for the exemption and that already paid, if any, at the time of import, along with interest, at the rate fixed by notification issued under section 28AA of the Act, for the period starting from the date of import of the goods on which the exemption was availed and ending with the date of actual payment of the entire amount of the difference of duty that he is liable to pay.

Amendment to Rule 5

The newly substituted Rule 5 provides that the importer who intends to avail the benefit of an exemption notification shall mention the IIN and continuity bond number and details while filing the Bill of Entry.  The Deputy Commissioner/Assistant Commissioner at the Custom Station of importation shall allow the benefit of the exemption notification to the importer.  Once a Bill of Entry is cleared for home consumption, the bond submitted by the importer gets debited automatically in the customs automated system and the details shall be made available electronically to the Jurisdictional Custom Officer.

Amendment to Rule 6

Maintenance of records

Rule 6 was substituted a new Rule.  The newly substituted Rule 6 provides that the importer is liable to maintain certain records which are as below-

• the quantity and value of goods imported;
• date of receipt of goods imported in the relevant premises;
• quantity of goods consumed;
• quantity of goods sent for job work and nature of job work carried out;
• quantity of goods received after job work;
• quantity of goods re-exported; and
• remaining in stock, according to bill of entry.

Production of records

The importer shall produce the said account as and when required by the Deputy Commissioner of Customs/Assistant Commissioner of Customs having jurisdiction over the premises or where the goods imported shall be put to use for manufacture of goods or for rendering output service.

In case of non-receipt or short receipt of goods imported in the relevant premises, the importer shall intimate such non-receipt or short receipt immediately on the common portal in the Form IGCR-2.  In this form the following is to be provided-

• IIN;
• Details of goods not received-

• Bill of Entry Number;
• Bill of Entry date;
• Port of Import;
• Invoice Number;
• Item Number;
• Quantity not received;
• Amount paid.

Monthly statement

The importer shall submit a monthly statement on the common portal in the Form IGCR- 3 by the tenth day of the following month.  The monthly Statement shall contained the following-

• IIN;
• Details  of goods imported, consumed, re-exported, pending for use or cleared on payment of duty during the month;
• Job work and unit transfer details;
• Re-export details;
• Clearance on payment of duty.

Amendment to Rule 6A on job worker

Rule 6A was substituted a new Rule 6A.  This rule prescribes the procedure to be followed for allowing imported goods for job work as detailed below-

•  The importer shall maintain a record of the goods sent for job work during the month and mention the same in the monthly statement.
• The importer shall send the goods to the premises of the job worker under an invoice or wherever applicable through an e-way bill, as specified in the Central Goods and Services Tax Act, 2017, mentioning the description and quantity of the goods.
•  The maximum period for which the goods can be sent to the job worker shall be 6 months from the date of invoice or an e-way bill.
• In case the importer is not able to establish that the goods sent for job work have been used as per the particulars mentioned under rule 4, the Jurisdictional Custom Officer shall take necessary action against the importer under rules 8 and 8A.
• The job worker shall-

• maintain an account of receipt of goods, manufacturing process undertaken thereon and the waste generated, if any, during such process;
• produce the account details before the Jurisdictional Custom Officer as and when required by the said officer; and
• after completion of the job work, send the processed goods to the importer or to another job worker as directed by the importer for carrying out the remaining processes, if any, under the cover of an invoice or an e-way bill.

Insertion of new Rule 6B on unit transfer

Rule 6B was inserted in the amendment dealing with the procedure for allowing imported goods for unit transfer.  The importer shall maintain a record of the goods sent for unit transfer during the month and mention the same in the monthly statement.  The importer shall send the goods under an invoice or wherever applicable through an e-way bill, mentioning the description and quantity of the goods.

The importer shall in relation to transfer of goods to another unit,-

•  maintain an account of receipt of goods, manufacturing process undertaken thereon and the waste generated, if any, during such process;
•  produce the account details before the Jurisdictional Custom Officer as and when required by the said officer; and
• after completion of the said process, send the processed goods back to the premises of the importer from where the goods were received or to a job worker for carrying out the remaining processes, if any, under the cover of an invoice or an e-way bill.

Amendment to Rule 7

The amendment substituted a new Rule for the existing one.  The substituted Rule provides for utilization of the goods or clearance of unutilized goods or defective goods or re-export of the goods.

Utilization of goods

The importer who has availed the benefit of an exemption notification shall use the goods imported in accordance with the conditions specified in the concerned exemption notification within six months from the date of import.

Clearance of unutilized/defective goods

The importer with respect to unutilized or defective goods so imported, the importer has an option to either re-export such goods or clear the same for home consumption within the said period.

The importer who opts to re-export such goods shall record the details of necessary export documents in the monthly statement:  The value of such goods for re-export shall not be less than the value of the said goods at the time of import.

The importer who opts to clear the unutilized or defective goods for home consumption shall pay the duty along with interest on the common portal.  The particulars of such clearance and the payment of duty shall be recorded by the importer in the monthly statement.

Payment of duty with interest

The importer has an option to clear the capital goods imported, after having been used for the specified purpose, on payment of duty equal to the difference between the duty leviable on such goods but for the exemption availed and that already paid, if any, at the time of importation, along with interest, at the rate fixed by the notification issued under section 28AA of the Act, on the depreciated value allowed in straight line method, as specified below,-

• for every quarter in the first year @ 4%;
• for every quarter in the second year @ 3%;
•  for every quarter in the third year @3%;
• for every quarter in the fourth and fifth year @ 2.5%;
• and thereafter for every quarter @ 2%.

The depreciation shall be allowed from the date when the imported capital goods have come into use for the purpose as specified in the exemption notification upto the date of its clearance.  The importer shall record the particulars of such clearance and payment of duty in the monthly statement.

Recovery of duty

Rule 8 provides the procedure for recovery of duty in certain cases.  The amendment substituted Rule 8(1).  The newly substituted Rule 8(1) provides that in the event of any failure on the part of the importer to comply with the conditions or where the payment is not paid or short paid, the Deputy Commissioner of Customs

/Assistant Commissioner of Customs having jurisdiction over the premises where the imported goods shall be put to use for manufacture of goods or for rendering output service shall take action by invoking the bond to initiate the recovery proceedings of the amount equal to the difference between the duty leviable on such goods but for the exemption and that already paid, if any, at the time of importation, along with interest, at the rate fixed by the notification issued under section 28AA of the Act, for the period starting from the date of import of the goods on which the exemption was availed and ending with the date of actual payment of the entire amount of the difference of duty that the importer is liable to pay.