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TMI Blog2024 (4) TMI 1249X X X X Extracts X X X X X X X X Extracts X X X X ..... on of Origin of Copper Tubes exported to India and eligibility of such Copper Tubes for benefit of ASEAN-India Free Trade Agreement (AIFTA). 2. The applicant submitted that the company, M/s. L.S. Metal Vina LLC, Vietnam (hereinafter referred to as "Applicant") is a Company engaged in the manufacture and export of Copper Tubes and Stainless-Steel Pipes to various countries. The Applicant is filing the present application as an exporter of the Copper Tubes to India manufactured by them in their own factory with the below details :- (a) the Indian importer places a purchase order on the Applicant for export of copper tubes; (b) the Applicant manufactures the copper tubes and exports the copper tubes directly from Vietnam to India; (c) the Applicant raises invoice on Indian importer for supply of copper tubes to importer in India; 2.1 The application further submitted that Vietnam is a part of Association of Southeast Asian Nations (ASEAN). India has signed Free Trade Agreement with ASEAN countries, viz., ASEAN-India Framework Agreement on Comprehensive Economic Cooperation (hereinafter referred as "AIFTA"). Under the AIFTA, India has agreed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... originating in Indonesia will be considered as originating in Vietnam for the purposes of determination of origin criteria of the goods manufactured in Vietnam. Sourcing of copper cathodes for manufacture of copper tubes and fulfilment of value addition criterion under the AIFTA 2.5 The Applicant is a manufacturer of copper tubes and exports the same to various countries such as India, Japan, Italy, Turkey, etc. For manufacture of copper tubes, the Applicant imports copper cathodes from two sources, i.e., Indonesia (ASEAN country) & non-ASEAN countries such as Australia, Congo and Korea. 2.6 With regard to the sourcing of the copper cathodes, the following additional points are relevant to note : The ratio of copper cathodes required in the manufacture of copper tubes is approximately 1:1. i.e., approximately 1 MT of copper cathodes is required to manufacture 1 MT of copper tubes. The price of the copper cathodes imported from Indonesia is higher than the price of copper cathodes imported from non-ASEAN countries. The value of copper cathodes constitutes close to 90% of the cost of the copper tubes manufactured out of it. 2.7 The Applicant adopts the following model to ensu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cost sheet evidencing that copper tubes satisfy the value addition criteria, (ii) Commercial invoice; (iii) Packing List & Bill of Lading; and (iv) Customs Declaration, to the Issuing Authority in Vietnam for issuance of Certificate of Origin ('COO') in respect of the copper tubes to be exported to India. 2.8 On the strength of the COO issued by the Issuing Authority in Vietnam and provided by the Applicant to the importer in India, the importer avails the benefit of the AIFTA Notification in respect of the copper tubes exported by the Applicant. An analysis of the data filled up in a sample Form I (issued under Notification No. 81/2020-Cus (N.T.), dated 21-8-2020 notifying the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020) would also show that the copper tubes exported by the Applicant satisfy the origin criteria. 2.9 In the light of aforementioned, the Applicant seeks to enter the following questions for Advance Ruling : (a) Whether the copper tubes exported by the Applicant to India satisfy the origin criteria prescribed under the Rules of Origin issued in terms of AIFTA? (b) Whether the copper tubes exported by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... untries other than India. 3.4 As far as the determination of origin of copper tube is concerned, it is informed that the Jodhpur Preventative Commissionerate. Jaipur Customs had initiated investigation into import of copper tubes by taking FTA benefit from Vietnam and other ASEAN Countries and had found out that the value addition requirement to be unsatisfactory. Due to this, the FTA Cell, CBIC has been requested to thoroughly investigate the matter. Letters have been issued from their office in all Customs formation for provisional assessment under bond and BG of such copper tubes and pipes imports so as to maintain uniformity in clearance and to check any port shifting by importers to evade the said compliance. Further, the matter has been taken up by the National Assessment Centre (NAC) and, as per NAC minutes dated 8-11-2023, it was agreed to assess all Bill of Entry for copper tubes and pipes (CTH 7411 10) being imported from Vietnam and Thailand claiming India-ASEAN FTA benefit provisionally with Bond and BG as per Rules, or as per Merit duty leviable. 3.5 In view of the above, since, the outcome of an ongoing investigation is pending, this office is of the view that the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mport of copper tubes taking FTA benefit from Vietnam and other ASEAN Countries and had found out that the value addition requirement to be unsatisfactory. Due to this, the FTA Cell, CBIC has been requested to thoroughly investigate the matter. Letters have been issued to all Customs formation for provisional assessment under bond and BG of such copper tubes and pipes imports so as to maintain uniformity in clearance and to check any port shifting by importers to evade said compliance. Further, the matter has been taken up by the National Assessment Centre (NAC) and, as per NAC minutes dated 8-11-2023, it was agreed to assess all Bill of Entry for copper tubes and pipes (CTH 7411 10) being imported from Vietnam and Thailand claiming India-ASEAN FTA benefit provisionally with Bond and BG as per Rules, or as per Merit duty leviable. Further, the concerned Commissionerate has requested to consider the situation of ongoing investigation in the matter is pending, the benefit of reduced or NIL duty on import of copper tubes from Vietnam under Indo-ASEAN FTA may not be allowed till the time investigation on this matter pertaining to the origin of the copper tubes imported from Vietnam is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s [L&T_26-4-2021_CAAR Mumbai_Para 4] (ii) "13.6 On the basis of the careful examination of the relevant provisions Rules and CAAR Regulations, 2021. I am on the considered view that an application may be considered "pending" before any officer of customs only if it is pending before an officer in formal manner before an officer who is competent to answer the said question in terms of specific powers vested with the officer under the Customs Act, 1962. An illustrative list of such situations would include cases wherein a Show Cause Notice has been issued, bill of entry has been provisionally assessed under Section 18 of the Act ibid. : the matter is pending before the Special Valuation Branch of the Customs Commissioner for the purpose of valuation of the goods in question; or the proper officer has held the pre-notice consultation with the applicant in terms of the proviso of sub-section (a) of Section 28(1) of the Customs Act, 1962." [HQ Lamps_8-8-2022_CAAR Delhi_Para 13.6] 10. I find that the matter of import of copper Tubes under benefit of Asian-India Free Trade Agreement (AIFTA) is under ongoing investigation and as well as under provisional assessment of Bills of Ent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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