Maize Starch – not exempted before 30 th April 2008?
In his reply to the debate, the FM said:
Tapioca starch is manufactured primarily by a large number of small, unorganized units. Owing to a hefty increase in the volume of imports, the Government had imposed a safeguard duty on this item in the year 2005-06 for a period of three years. This levy expires on 1 st May, 2008. In the meanwhile, the flood of imports continues. In order to allow some additional flexibility to this industry to adjust, I propose to increase the basic customs duty on this item from 30% to 50% with effect from 1 st May 2008 coinciding with the expiry of the safeguard duty.
To carry out the above objective, entry no 446 of the Notification 22/2001 Cus has been amended vide Notification 56/2008 Cus dated 29 th April 2008 as under:
against S. No. 446, for the entry in column (2), the entry “1108 12 00” shall be substituted
Prior to this amendment, the entry in column (2) was:
1108 12 00 ( Maize starch) , 1108 14 00, ( Manioc Starch) 1108 19 10 (Sago Starch) or 1108 19 90 ( Other Starch)
So with effect from 1.5.2008, the three types of starch mentioned above will be out of exemption Notification. But how do they amend the notification? If the entry is substituted with effect from the date of issue of notification, ie , 29.4.2008, there will be no exemption for the other three products on 29 th and 30 th of April 2008. Therefore in the preamble of the Notification, the following line has been inserted:
Provided nothing contained in this notification shall apply to
“( iaf ) the goods specified against serial No. 446 of the said Table on or before the 30 th day of April, 2008.”
Since the FM's speech is fresh in our memory we can understand the amended notification correctly. But after a couple of months, if somebody reads this notification, it sounds as if the goods falling under chapter heading 1108 1200 (Maize starch) are not eligible for exemption before 30 th April 2008. Instead of all this confusion, the Board could have waited for a couple of days and amended the entry 446 in Notification 21/2002 Cus on 1.5.2008 by a separate notification.