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TMI BlogGuidelines regarding Provisional Assessment under Section 18 of the Customs Act, 1962X X X X Extracts X X X X X X X X Extracts X X X X ..... 11 issued under Notification No. 81/2011-Customs (NT) dated 25.11.2011 were reviewed by Board in view of references from the field formations regarding guidelines on the implementation of Regulation 2 (2) and Regulation 4. 3. Regulations 2 (2), 3 and 4 require three elements - namely, (a) deposit of 20% of the differential duty between "provisional duty" and duty to be "finally assessed or re-assessed"; (b) execution of a bond; (c) surety or security or both, as deemed fit. 3.1 Section 18 of the Customs Act, 1962 defines the cases where provisional assessment may be resorted, as under: - (1) Notwithstanding anything contained in this Act but without prejudice to the provisions of Section 46- (a) where the impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the importer binds himself to pay the deficiency, if any, between the duty as may be finally assessed and the duty provisionally assessed, it would be necessary to obtain a bond for meeting the aforesaid condition. 3.5 Insofar as the requirement of obtaining a 20% deposit of the duty provisionally assessed, the Board has decided that this conditions be dispensed, particularly, as it necessitates following the procedure of refunds in cases where final assessment is in favour of the importer. Such requirements add to the transaction costs, lead to delays in clearance and detract from the ease of doing business. 3.6 It was also noted that Regulation 4 required that the importer should furnish such surety or security or both, as deemed fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... form (enclosed); and (b) furnish such security for the payment of the duty deficiency, as indicated in para 4 below. 3.9 The security to be obtained shall be in the form of a bank guarantee or a cash deposit, as convenient to the importer. 4. The following guidelines shall be followed while obtaining security where provisional assessment under section 18 of the Customs Act is being undertaken: Sl. No. Class of Importer Amount of Bank Guarantee or Cash deposit to be obtained as "security" of the differential duty Remarks 1. Imports by Authorised Economic Operators (AEO T3) 0% (Including cases at St. No.4 to 6b) In terms of Circular No. 33/2016-Customs dated 22nd July, 2016 as amended. 2. Imports by Authorised Economic Ope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally assessed by the proper officer as deemed fit 6(b) Cases, where the proper officer deems it necessary to order a provisional assessment, whether for the purposes of chemical test or requirement of information or causing inquiries: (1) Where differential duty has been estimated (2) Where, despite best efforts by the proper officer, differential duty can not be computed. 100% 0% Provided that the Principal Commissioner of Customs or the Commissioner of Customs may reduce the amount of security where there are goods and justifiable reasons to do so. N.A. 4.1 By way of a clarification, attention is also drawn to an earlier instruction of the Ministry contained in F. No. 511/7/77-Cus VI dated 09.01.1978, to the effect that the am ..... X X X X Extracts X X X X X X X X Extracts X X X X
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