Customs duty – ad-hoc exemption - instructions
As per Section 25(2) of the Customs Act, if the Central Government is satisfied that it is necessary in the public interest so to do, it may, by special order in each case, exempt from payment of duty, under circumstances of an exceptional nature to be stated in such order, any goods on which duty is leviable.
Thus, each case has to be examined on merit, keeping in mind, the aspect of “public interest”, “the exceptional nature of the circumstances” warranting duty exemption, and the general policy adopted in the past.
Board had in 2003 issued guidelines for granting exemption under the section.
As per the guidelines,
++ payment of Customs duty cannot be viewed as a dispensable expenditure, and there should be no need to seek ad-hoc exemption from payment of Customs duty on goods meant for the normal functional requirements of the Central Police Organizations, State Police Organizations, and Para-military forces.
++ Similarly Ad-hoc exemption from Customs duty will not be considered for import of goods made by Central/State Governments, autonomous bodies, Municipalities, and public sector undertakings as part of the schemes or projects implemented by them.
But these instructions are not kept in mind while requesting for adhoc exemption. Board gets a number of requests from from Ministries, State Governments, Autonomous Bodies, Municipalities and Public Sector Undertakings for customs duty exemption on various items meant for normal functional requirement or for various projects implemented by them, even without specifying as to why they could not provide budgetary allocation for payment of Customs duty.
So now Board directs that such requests for exemption in such cases should not be forwarded and to make necessary budgetary provisions for payment of Customs duty along with the cost of the imported goods. Board directs that such requests will not be considered.
CIRCULAR NO. ,Dated: February 13, 2007