Additional Customs Duty on goods produced in SEZ
The 2005 Budget imposed a new additional customs duty ( relates to vat/sales tax etc) under Section 3(5) of the Customs Tariff Act. Now the goods manufactured in SEZ and brought to the DTA were exempted from this duty. And how did the Government do it? Obviously by an exemption notification, True! But there was a joke. The Government exempted this customs duty by a Central Excise notification! Strange but True. Please see Notification No. 9/2005 dated 1.3.2005, which in exercise of the powers conferred by Section 5A of the Central Excise Act exempted these goods from payment of duty leviable under section 3(5) of the Customs Tariff Act!. Under the Central Excise Act, Customs duty was exempted.
Government appears to have realized this mistake and has now made a correction. By Notification No. 25/2005-CX, dated, May 16, 2005, Notification No. 9/2005 is rescinded and by Notification No. 45/ 2005-Cus, Dated: May 16, 2005, the same notification is issued under the Customs Act. Strangely enough it was only on 13th May that Notification No. 9/2005 was amended and may be it was that time that this mistake was noticed.
Any correction is welcome, more so the attitude and will to correct.
Notification No. , dated, May 16, 2005 and Notification No. , Dated: May 16, 2005