80A. Date of Payment of Duties.
(1) Any duty specified in a notice of assessment is due and payable on the date specified in the notice, being a date not less than 5 clear working days after the date of the issue of the notice of assessment or a date not less than 5 clear working days after the inwards report of the conveyance, whichever is the later date.
(2) Where an amount of duty specified in a notice of assessment under this section is not paid on or before the date specified in the notice and the notice has been issued to the owner or agent of the goods, the owner or agent of the goods shall pay to the Collector, in addition to the duty so specified, interest on the unpaid duty at the rate of 8% of the amount of the unpaid duty for each 5 day period or part thereof for which the duty remains unpaid from the date for payment specified in the notice until the duty is paid.
(2A) The payment of any duties or interest under this sections shall be made:-
(a) in the case of an entry lodged by electronic transmission to the Customs service – at any Customs office directly connected to the
Customs computer service; or
(b) in the case of a manual entry – at any Customs office; or
(c) in the case of any dispute – at a place nominated by the Commissioner General.
(3) The Collector may reduce or remit any penalty payable under this section, on the basis of a written application made by the owner or agent of the goods within 30 days after the due date of an assessment and upon payment of the duty and interest, to remit the whole or any part of the interest within 30 days after the due date of an assessment and upon payment of the duty and interest.
(3A) In considering whether to remit the whole or a part of the interest, the Commissioner General may consider the following maters:-
(a) the capacity of the owner or his agent to have avoided making the late payment and the extent to which that capacity was exercised; and
(b) the history of the owner or his agent resulting in previous late payment, revenue loss or any Customs prosecution instituted against the applicant or his agent.
(3B) The Commissioner General shall inform the applicant of the decision to remit within 30 days after receiving the application for remission of interest.
(3C) Any remission of interest may be applied to offset other debts as provided under section 194 of this Act.
(4) If a dispute arises as to the amount of the duty on any goods or the interest penalty remitted under Subsection (3), the provisions of Section 176 shall apply.
Interest for delayed payment of tax/duties rationalized across customs, excise and service at 15% per annum
Previously, rate of interest for delay in payment of service tax beyond one year was 30%, below one year but more than 6 months was 24% and below 6 months was 18%. This has now been rationalised to 15%. Rate of interest for delay in payment of excise duty and customs duty has been reduced from 18% to 15%.
An annual service tax/ cenvat return shall be required to be filed by speci-fied tax payers (from April 1, 2016).
An additional compliance is being charged on taxpayers and it does not reconcile with Finance Minister's remark of reducing the compliance burden.
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Union Budget 2016 – Amendments in Customs Legislation
Introduction
Present article deals with certain prominent
amendments made/proposed in the Customs Act, 1962 (“Act”) and certain rules
laid thereunder.
Number of Tribunals increased
In the last Budget, in order to reduce burden of
stay applications on Tribunals, certain measures were taken. Such measures
included, a pre-fixed amount of pre-deposit. In this Budget, Government has
proposed to establish 11 (Eleven) new Benches of Customs, Excise and Service
Tax Appellate Tribunal (CESTAT) so that justice can be rendered faster. This
step would definitely help speedy disposal of large number of pending cases.
AMENDMENTS IN THE ACT:
Exemption from Duty
Section 25 of the Act granted discretionary power
to the Government for exempting certain duties, if Government is of the opinion
that such exemption of tax is required in public interest. Finance Bill, 2016
has amended this Section, stating that such exemption if notified by the
Government shall come into effect on the date of such publication in the
official gazette and shall not be required to be published or offered for sale
on the date of its issue by the Directorate of Publicity and Public Relations
of the Board, New Delhi as was a requirement prior to the amendment.
Sub-section 5 of Section 25, which elaborated this process has now been
deleted. Therefore, the amendment aimed to omit the requirement of publishing
and offering for sale any notification issued, by the Directorate of Publicity
and Public Relations of CBEC.
Extension of time limit to issue Show
Cause Notice (Section 28)
Due to various reasons, the officers
were not able to issue SCN within the stipulated period of one year. Also,
there is provision in this Section, which provides grace period up to five
years in extraordinary circumstances. However, the same can be invoked only if
the assessee is involved in certain mala fide activities like: wilful
misstatement, fraud, collusion, suppression of facts or wilful contravention of
law to evade duty. In such cases, the onus is on the Department to prove mala
fides on the part of the assessee. In order to raise SCNs beyond one year,
though Departmental Officers used to allege such mala fides rampantly, it was
difficult to prove such allegations resulting in failure of such SCNs raised
belatedly.
Now,
with the proposed amendment, the notice to be served to defaulter for duties
not levied or not paid or short-levied or short-paid, the officer in-charge has
been granted an extension of a year from the original section for providing the
notice of Show-Cause (SCN). Therefore, the in-charge officer shall have two
years at his disposal for serving the notice on the person chargeable with the
duty or interest from the relevant date.
Interest rates reduced
Deferred Payment
Section 47 of the Act lays down the
procedure for payment of duty on goods used for home consumption.
The amendment has provided additional
benefit of deferred payment to certain class of importers for any duty or
charges laid down by the Government on them. The insertion of 47 (1) shall
permit certain class of importers to make deferred payment of duty and
additionally there shall be negative or reduced rate of interest upon the
issuance of notification by the relevant department.
Similarly,
the deferred payment, for duty or charges bestowed upon them, has been
permitted for certain class of exporters by insertion of Section 51(1) in the
Act. These classes of exporters shall be Notified by the Government from time
to time.
Exemption of duty during transit of
certain goods
Conveyance of goods mentioned in the import
manifest or import report shall be permitted to be transported without payment
of duty. The amendment has introduced certain criteria for transaction of goods
without payment of duty. The authorised officer may lay down certain conditions
as may be deemed fit for availing the advantage for non-payment of the duty.
Warehouse
Budget has given significant importance to the
provisions relating to warehouse under Chapter XI of the Act. The physical
control pertaining to private/public warehouses have been eased out and
warehouse keepers shall be made more responsible via this amendment. The
concept of special warehouses has been introduced in cases where the specific
goods require physical control of the Government.
The definition of the warehouse under Section 2
(43)1 of the Act has undergone a change and has inserted the provision of
Section 58 A in relation to licensing of special warehouse. These special
warehouses will store specific goods under physical control of the department.
The public and private warehouses will be controlled by warehouse keepers
themselves under authority.
Warehousing Station
Further, the Section 2(45) which
defined the term warehousing station2 and Section 93 which lays down the
provision in relation to warehouse station has been deleted. Section 9 had
elaborately laid down the power of the concerned officer to declare the places
to be warehousing stations at which alone public/private warehouses may be set
up.
Therefore, private/public warehouses
can be established at any place, as there is no need of having a declared
warehouse station.
However, post removal of requirement
pertaining to “warehousing station”, power to grant license for a
public/private warehouse has been shifted from Assistant Commissioner of
Customs or Deputy Commissioner of Customs, to Principal Commissioner or
Commissioner of Customs.
Period for which goods can be stored in
warehouse.
Position prior to amendment:
i. Capital goods intended for use in
any 100% (Hundred Percent) export oriented undertakings (EOU), till the expiry
of 5 years
ii.
Goods other than capital goods intended for use in any 100% EOU, till the expiry
of 3 years.
Position post amendment
i. Capital goods intended for use in
any 100% EOU/STP/EHTP/warehouse in which manufacturing is permitted, till their
clerance from the warehouse.
Goods other than capital goods intended
for use in any 100% EOU/STP/EHTP/warehouse in which manufacturing, till their
consumption/clearance from the warehouse after the date of order permitting
deposit of goods in warehouse.
Prior
to the amendment goods intended to be used for export oriented undertaking only
were permitted. The scope has broadened the facility for goods which can easily
be placed in the warehouse. Now, the goods used for electronic hardware
technology park (EHTP) unit or software technology park (STP) unit or any
warehouse wherein manufacture or other operations have been permitted under
Section 65, till their clearance from the warehouse can remain in the warehouse
or till the consumption or clearance from the warehouse.
Responsibilities of the owner and
customs officer over the warehouse
As per Section 62, customs officer was
the managerial in-charge for the inflow and outflow of goods and the entire
control over the warehoused goods vested upon him. Further, in case, the owner
of the warehouse fails to make payment within 10 (ten) days from the due date to
the warehouse keeper as obliged under Section 63 of the Act then the warehouse
keeper is permitted to sell the warehoused good.
These two onerous Sections have been
deleted while additional responsibilities have been carved out for warehouse
keeper under Section 73 of the Act.
Responsibilities of Warehouse Keeper
The warehouse keeper has to be vigilant
in following the legislation with respect to storage and transit of goods.
After the amendment, the strict liability shall apply to warehouse keeper and
the goods stored in the warehouse shall be considered in the custody of
licensee or warehouse keeper. The licensee shall be liable for payment of duty,
interest, fine and penalties without prejudice to any other action that may be
taken against the licensee for improper removal of goods.
Section 73 has raised additional
accountability on the warehouse keeper with regards to goods kept in the
warehouse and he can’t evade the responsibilities conferred by the Act.
Baggage Rule
Baggage Rules, 1998 will be replaced by
the new Baggage Rules, 2016. These novel rules, shall come into effect on 1st
April, 2016, propose the applicability of the Customs Baggage Declaration
Regulations, 2013 only to those passengers who carry dutiable or prohibited
goods. Amidst all these new rules, Government also proposes to simplify the
provisions relating to restriction of baggage for international passengers.
This rule shall be relaxed so as to enable the international passenger with
more free baggage allowance. The filing of baggage declaration will be required
only for those passengers who carry dutiable goods.
TARIFF AMENDMENTS
National Dialysis Services Programme
Under National health mission
Government has proposed to exempt certain parts of dialysis equipment from
basic customs duty, excise/ countervailing duty and special additional duty to
provide dialysis services in all district hospital.
Further, the exemption on customs duty
is proposed to be granted on braille paper to give it equal standing with other
assistive devices like rehabilitation aids and other goods used by differently
abled (Divyang) persons who attract nil basic customs duty.
Make in India
This flagship event of the Government
has carved its way in the Budget as well. The Finance Bill, 2016 introduced certain
inputs to reduce costs and improve competitiveness of domestic industry in
sectors like Information Technology hardware, capital goods, defence
production, textiles, mineral fuels & mineral oils, chemicals &
petrochemicals, paper, paperboard & newsprint, maintenance repair and
overhauling of aircrafts and ship repair. Moreover, Government has taken a
number of steps to reduce the cargo release time and the transaction costs of
EXIM trade.
The Customs Tariff Act, 1975
Government has proposed to amend the
First Schedule to the Customs Tariff Act, 1975 so as to make it exhaustive and
it shall include editorial changes in the Harmonized System of Nomenclature
(HSN).
CONCLUSION
It
appears that the amendments introduced in customs legislation are progressive and
have tried to provide ‘ease’ of doing business in India, speed in litigation
resolution, and simplify the procedures. However, whether it gets percolated to
grassroot level of each citizen, only time will be able to depict.
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Filed under Late Payment of Interest & duty 28/07/2017
