TMI BlogFinance Bill, 2017. To prescribe effective rates of duty and to carry out changes in the Rules made under the respective ActsX X X X Extracts X X X X X X X X Extracts X X X X ..... Tariff No.3/2017-Central Excise to No.7/2017-Central Excise 2 nd February, 2017 Non-Tariff No.2/2017-Central Excise (N.T.) to No.5/2017-Central Excise (N.T.) 2 nd February, 2017 Unless otherwise stated, all changes in rates of duty take effect from the midnight of 1st February/2nd February, 2017. A declaration has been made under the Provisional Collection of Taxes Act, 1931 in respect of clauses 109 (a), 110, 118 and 146 of the Finance Bill, 2017 so that changes proposed therein take effect from the midnight of 1st February / 2nd February, 2017. The remaining legislative changes would come into effect only upon the enactment of the Finance Bill, 2017. These dates may be carefully noted. 2. Important changes in respect of Customs and Central Excise duty rates and legislative changes are contained in the four Annexes appended to this letter: 1) Annex I contains Chapter wise changes relating to Customs; 2) Annex II contains Chapter wise changes relating to Central Excise; 3) Annex III contains clarification being issued relat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Taxes Act, 1931, this increase will come into force with immediate effect. Chapter 21 to 25: No change Chapter 26: 1) The Second Schedule (Export Tariff) to the Customs Tariff Act, 1975 is being amended so as to prescribe a tariff rate of export duty of 30% for all goods falling under tariff item 2606 00 90, namely, Other aluminium ores and concentrates . Clause 110 of the Finance Bill, 2017 refers. By virtue of declaration under the Provisional Collection of Taxes Act, 1931, this change will come into force with immediate effect. 2) Export duty is being imposed at an effective rate of 15% on Other aluminium ores, including laterite falling under tariff item 2606 00 90. However, goods other than the said goods falling under tariff item 2606 00 90 (concentrates) will continue to attract Nil export duty. S.No.24E and S.No.24F of notification No. 27/2011-Customs, dated 1st March, 2011 as amended by notification No.3/2017-Customs, dated the 2nd February, 2017 refers. Chapter 27: 1) Basic Customs Duty on Liquefied Natural Gas (LNG) falling under tariff item 2711 11 00 is being reduced from 5% to 2.5%. S.No.138 of notification No.12/2012-Customs, dated 17th Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Chapter 38 and 39: 1) Basic Custom Duty (BCD) is being reduced from 7.5% to 5% on Catalyst [3815 90 00] and Resin [3909 40 90] for use in the manufacture of cast components of Wind Operated Electricity Generator [WOEG], subject to actual user condition. Notification No. 12/2012Customs, dated 17th March, 2012 as amended vide Notification No.6/2017- Customs, dated 2nd February, 2017 [new S. Nos. 230C and 230D] refers. 2) SAD is being exempted on Catalyst [3815 90 00] and Resin [3909 40 90] for use in the manufacture of cast components of WOEG, subject to actual user condition. Exemption from SAD will be valid till 30th June, 2017. Notification No. 21/2012-Customs, dated 17th March, 2012 as amended vide Notification No.4/2017- Customs, dated 2nd February, 2017 [new S. Nos. 14H and 14I] refer. Chapter 40 to 53: No change Chapter 54: 1) Basic Customs Duty on Nylon Monofilament yarn falling under Customs Tariff Item 5404 19 90 for use in Monofilament long line systems for tuna fishing is being reduced from 7.5% to 5%, subject to certain conditions. Notification No. 12/2012-Customs, dated 17th March, 2012 as amended vide notification No.6/2017- Customs, dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommunication grade optical fibres or optical fibre cables, subject to actual user condition. Notification No. 12/2012-Customs, dated 17th March, 2012 as amended vide Notification No.6/2017- Customs, dated 2nd February, 2017 [New S. No. 333D] refers. Chapter 73 to 74: No change Chapter 75: 1) Basic Customs duty on Nickel and articles thereof is being reduced from 2.5% to Nil. S. No.337 of Notification No. 12/2012-Customs dated 17th March, 2012 as amended by Notification No.6/2017-Customs, dated 2nd February, 2017 refers. Chapter 76 to 83: No change Chapter 84 and 85: 1) Basic Customs duty on Reverse Osmosis (RO) membrane element for household type filters falling under tariff item 8421 99 00 is being increased from 7.5% to 10%. Clause 109 (a) of Finance Bill, 2017 refers. By virtue of declaration under the Provisional Collection of Taxes Act, 1931, this increase will come into force with immediate effect. 2) However, all other goods falling under tariff item 8421 99 00 will, continue to attract BCD at 7.5%. Notification No. 12/2012-Customs dated 17th March, 2012 as amended by Notification No.6/2017-Customs, dated 2nd February, 2017 [new S. No. 400A] ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d through postal parcels, packets and letters, of CIF value not more than one thousand rupees per consignment are being exempted from BCD, CVD and consequently from SAD. S. No. 519 of Notification No. 12/2012-Customs dated 17.03.2012 as amended by Notification No.6/2017-Customs dated 02.02.2017 refers Miscellaneous: 1) Condition No.40A [S.No.357A] of notification No.12/2012-Customs dated 17.03.2012 is being amended so as to allow the goods imported for petroleum or coal bed methane operations by availing of the benefit of the exemption, which are no longer required for the said purpose, to be disposed of on payment of applicable customs duties, on the depreciated value calculated as per straight line method (subject to depreciated value not being less than 30% of the original value) of such goods. Condition No.40A of notification No.12/2012Customs, dated 17th March, 2012, as amended by notification No.6/2017-Customs, dated 2nd February, 2017 refers. Further, it is also clarified that this relaxation shall, mutatis mutandis, apply for domestically manufactured goods supplied against International Competitive Bidding at Nil excise duty under notification No.12/2012- Central E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion No.5/2017 -Customs dated 2nd February, 2017 refers. ***** ANNEX II EXCISE Chapter 1 to 20 and 22, 23: No change Chapter 21 and 24: 1) The additional duty of excise levied under the Seventh Schedule to the Finance Act, 2005 [commonly known as health cess] on non-filter and filter cigarettes of sub-heading 2402 20 is being increased. Clause 146 of the Finance Bill, 2017 refers. By virtue of declaration under the Provisional Collection of Taxes Act, 1931, these increases will come into force with immediate effect. There is no change in the Basic Excise Duty leviable under the First Schedule to the Central Excise Tariff Act, 1985 and the NCCD leviable under Seventh Schedule to the Finance Act, 2001. The changes in additional duty of excise rates on cigarettes are summarized below. Tariff Item Description Additional Duty of Excise (Rs. per 1000 sticks) Existing Rate New Rate 2402 20 10 Non filter not exceeding 65mm 215 311 2402 20 20 Non-filt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th falling under tariff item 2403 19 29] is being increased from ₹ 21 per thousand to ₹ 28 per thousand and from ₹ 21 per thousand to ₹ 78 per thousand respectively. However, there is no change in basic excise duty rate on other goods falling under tariff item 2403 19 29, which will continue to be ₹ 21 per thousand. Notification No. 12/2012 -Central Excise dated 17.03.2012 as amended by notification No.6/2017-Central Excise dated 02.02.2017 [S.No.48 and new S.Nos.48A and 48B] refers. 4) The additional duty of excise levied under the Seventh Schedule to the Finance Act, 2005 [commonly known as health cess] on jarda scented tobacco, gutkha and chewing tobacco is being increased from 6% to 12%. Clause 146 of the Finance Bill, 2017 and notification No. 6/2005-Central Excise, dated the 1st March, 2005 as amended by notification No.3/2017Central Excise dated 02.02.2017 [S.Nos.13, 15 and 20 are being omitted] refers. By virtue of declaration under the Provisional Collection of Taxes Act, 1931, these changes will come into force with immediate effect. Further, the effective rate of additional duty of excise levied under the Seventh Schedule to the Finance A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Excise dated 17.03.2012 [S.No.128, which prescribed a concessional excise duty of 1% subject to certain conditions] is being amended so as to exclude goods falling under heading 3101 from the purview of the said entry. Notification No. 12/2012- Central Excise, dated 17th March, 2012 as amended by notification No.6/2017-Central Excise dated the 2nd February, 2017 [S. No. 128] refers. Chapter 32 to 37: No change Chapter 38 and 39: 1) Excise duty is being exempted on Catalyst [3815 90 00] and Resin [3909 40 90] for use in the manufacture of cast components of Wind Operated Electricity Generator subject to actual user condition. The exemption from excise duty will be valid till 30th June, 2017. Notification No. 12/2012-Central Excise, dated 17th March, 2012 as amended vide Notification No.6/2017-Central Excise, dated 2nd February, 2017, [new S. Nos. 145 B and 145C] refers. 2) Excise duty on Membrane Sheet and Tricot / Shaper, falling under tariff item 3921 19 00, for use in the manufacture of Reverse Osmosis (RO) membrane for household type filters is being reduced from 12.5% to 6% subject to actual user condition. This concessional excise duty will be valid till ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification No.6/2017- Central Excise dated 02.02.2017 refers 3) Nil excise duty, on articles of silver jewellery, other than those studded with diamond, ruby, emerald or sapphire, is being made subject to condition that no credit of input or input services or capital goods has been availed by manufacturers of such goods. S. No. 199 (III) of Notification No. 12/2012-Central Excise dated 17.03.2012 as amended by Notification No.6/2017- Central Excise dated 02.02.2017 refers. 4) Nil excise duty, on Silver coins of purity 99.9% above, bearing a brand name, is being made subject to condition that no credit of input or input services or capital goods has been availed by manufacturers of such goods. S. No. 200 (III) of Notification No. 12/2012-Central Excise dated 17.03.2012 as amended by Notification No.6/2017- Central Excise dated 02.02.2017 refers. Chapter 72 to 83: No change Chapter 84 and 85: 1) Excise duty is being exempted on Micro ATMs as per standards version 1.5.1, fingerprint reader / scanner, and Iris Scanner. Further, excise duty is also being exempted on parts and components for manufacture of these devices, subject to actual user condition. This exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d quality control) and components/parts, required for balance of systems operating on biogas/ bio-methane/ by-product hydrogen, subject to certain conditions. The concessional excise duty will be valid till 30th June, 2017. Notification No.5/2017- Central Excise dated 2nd February, 2017 refers. 3) 6% concessional excise duty, currently applicable to LED (Light Emitting Diode) driver and MCPCB (Metal Core Printed Circuit Board) for use in the manufacture of LED lights and fixtures or LED lamps [S. No. 321A of Notification No. 12/2012- Central Excise dated 17th March, 2012 refers], is being extended to all parts for use in the manufacture of LED lights or fixtures including LED Lamps subject to actual user condition. This 6% concessional excise duty will be valid till 30th June, 2017. S.No.321A of Notification No. 12/2012- Central Excise, dated 17th March, 2012 as amended vide Notification No.6/2017- Central Excise, dated 2nd February, 2017 refers. ******* ANNEX III CLARIFICATION The Sub-section (1) of Section 3 of the Central Excise Act, 1944, provides for levy of excise duty, on goods produced or manufactured in India at rates specified in the First and Second ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied that EOUs will also be eligible to import or procure raw materials/inputs at other concessional/Nil rate of BCD, excise duty/CVD or SAD, as the case may be, provided they fulfill all conditions for being eligible to such concessional or Nil duty. For these purposes, if an EOU is already registered with the jurisdictional Central Excise Authority, it will not be required to take any fresh registration under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2016 or the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable and Other Goods) Rules, 2016, as the case may be. Further, there will be no need for an EOU to separately comply with the Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2016 for availing the CVD exemption, if the procedure under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rule, 2016 is followed by it for availing exemption / concession from BCD on imports of inputs/raw materials. ***** ANNEX IV LEGISLATIVE CHANGES A. CUSTOMS: I. AMENDMENTS IN THE CUST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of the Indian Revenue Service (Customs and Central Excise), who is qualified to be a Member of the Board, shall be the revenue Member of the Authority for the purposes of Customs Act. It also seeks to provide for transferring the pending applications before the Authority for Advance Rulings (Central Excise, Customs and Service Tax) to the Authority constituted under section 245-O of the Income-tax Act from the stage at which such proceedings stood as on the date on which the Finance Bill, 2017 receives the assent of the President. 7. Section 28G relating to vacancies not to invalidate proceedings is being omitted. [94] 8. Sub-section (3) of section 28H is being amended so as to increase the application fee for seeking advance ruling from rupees two thousand five hundred to rupees ten thousand on the lines of the Income-tax Act. [95] 9. Sub-section (6) of section 28I is being amended so as to provide time of limit of six months by which Authority shall pronounce its ruling on the lines of the Income-tax Act. [96] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [100] 14. Section 49 is being amended to extend the facility of storage under section 49 to imported goods entered for warehousing before their removal. [101] 15. Section 69 relating to clearance of warehoused goods for exportation is being amended to align it with the proposed omission of section 82. [102] 16. Section 82 relating to label or declaration accompanying goods to be treated as entry is being omitted. [103] 17. Section 84 is being amended to empower the Board to make regulations to provide for the form and manner in which an entry may be made in respect of goods imported or to be exported by post. [104] 18. Section 127B is being amended so as to insert a new sub-section (5) therein to enable any person, other than applicant, referred to in subsection (1) to make an application to the Settlement Commission. [105] 19. Sub-section (3) of section 127C is being amended so as to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B. Amendments affecting rates of BCD [109(a)] Rate of Duty Commodity From To 1. Cashew nut, roasted, salted or roasted and salted 30% 45% 2. RO membrane element for household type filters 7.5% 10% The amendments involving increase in the duty rates will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. IV. AMENDMENT IN THE SECOND SCHEDULE TO THE CUSTOMS TARIFF ACT, 1975 [Clause 110 of the Finance Bill, 2017] S. No. Amendment Amendments affecting rates of Export duty Rate of Duty From To Ores and concentrates 1. Other aluminium ores and concentrates Nil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction (5), to rectify any error apparent on the face of record. [117] AMENDMENTS IN THE FIRST SCHEDULE TO THE CENTRAL EXCISE TARIFF ACT, 1985 [ Clause 118 of the Finance Bill, 2017] S.No. Amendment Amendments involving change in the rate of Basic Excise duty Rate of Duty Commodity From To A. Tobacco and Tobacco Products 1. Cigar and cheroots 12.5% or ₹ 3755 per thousand, whichever is higher 12.5% or ₹ 4006 per thousand, whichever is higher 2. Cigarillos 12.5% or ₹ 3755 per thousand, whichever is higher 12.5% or ₹ 4006 per thousand, whichever is higher 3. Cigarettes of tobacco substitutes Rs.3755 per thousand Rs.4006 per thousand 4. Cigarillos of tobacco substit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usand 6. Other Cigarettes Rs.560 per thousand Rs.811 per thousand 7. Chewing tobacco (including filter khaini) 10% 12% 8. Jarda scented tobacco 10% 12% 9. Pan Masala containing Tobacco (Gutkha) 10% 12% The above amendments involving increase in the duty rates will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. V. AMENDMENTS IN THE CENTRAL EXCISE RULES, 2002 AND THE CENVAT CREDIT RULES, 2004 S.No. Amendment 1. Sub-rule (2) is being inserted in rule 21 of Central Excise Rules, 2002 so as to provide for a time limit of three months [further extendable by 6 months] for granting remission of duty under the said rule 21 read with section 5 of the Central Excise Act, 1944. Notification No.5/2017-Central Excise (N.T.), dated 02.02.2017 refers. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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