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Government of India
Ministry of Finance
Department of Revenue
Central
Board of Indirect Taxes & Customs
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Circular No. 4/2020
– Customs
North Block, New Delhi Date 21th January 2020
To,
All Principal Chief Commissioners/Chief Commissioners of Customs.
Principal Commissioners/Commissioner of Customs.
Sub: Clarification
relating to import of gifts-reg.
Madam/ Sir,
Please refer to the
Notification 35/2015-2020 dated 12.12.2019 issued
by the Directorate General of Foreign Trade, Department of Commerce, Ministry of
Commerce and Industry.
2. Clarifications have been sought by the field
formations as regards the application of the said notification of DGFT and how
the same has to be read with
Notification 50/2017-Customs dated 30th June 2017,
especially in relation to the exemption available for imports of bonafide gifts
up to a c.i.f. value of Rs. 5000.00.
2.1 References have also been made
to
Instruction 9/2017-customs dated 5th July 2017
raising the issue of difficulty in implementing the DGFT notification due to the
said instruction.
3. The issue has been examined.
4. DGFT
Notification states as follows:
“import of goods. including those
purchased from e –commerce portals, through post or courier, where customs
clearance is sought as gifts, is prohibited except for life saving drugs/
medicines and Rakhi (but not gifts related to Rakhii.
Explanation:
1. Rakhi (but not gifts related to Rakhi) will be covered under Section
25(6) of Customs Act, 1962 that reads “…no duty shall be collected if the amount
of duty leviable is equal to or less than Rs. 100/,
2. Import of goods as
gifts with payment of full applicable duties is allowed “.
4.1 DGFT
Notification effectively means that if goods imported through courier or post
(be it e- commerce imports or otherwise) as gifts seek the exemption available
for imports of bonafide gifts up to a c.i.f. value of Rs. 5000.00 vide Sl. No
608A of
Notification 50/2017-Customs dated 30th June 2017,
then the imports will be prohibited. However, the goods imported as gifts can be
allowed import free (i.e. without prohibition) on payment of full applicable
duties. Since the goods imported as gifts would be personal imports, the full
applicable duties will be as follows:
(a) Basic Customs Duty at the
applicable tariff rate as per the First schedule of the Customs Tariff Act for
the heading 9804 which is 35% at present
(b) IGST at the rate specified
for the heading 9804 (SI. No. 227 schedule IV) in Notification 1/2017
-Integrated Tax (rate) dated 28th June 2017 for IGST which is at present 28%.
4.2 However, lifesaving drugs/ medicines can continue to avail exemption
available under SI. No. 607A as well as Sl. No. 608A of
Notification 50/2017-Customs dated 30th June 2017.
5. Section 25 (6) of the Customs Act states that, “Notwithstanding anything
contained in this Act, no duty shall be collected if the amount of duty leviable
is equal to, or less than, one hundred rupees.”. Thus, it goes without saying
that if the duty on any goods is less than one hundred rupees, same will not be
collected.
6. As regards
Instruction 9/2017 -Customs dated 5th July 2017 it
is to state that the said instructions were issued to clarify the application of
clause 3(1)(i) of Foreign Trade (Exemption from application of Rules in certain
cases) Order 1993 which put a restriction on personal imports above a cif value
of 2000.00.
6.1 The FTO 1993 has since been amended vide issue of Foreign
Trade (Exemption from application of Rules in certain cases) Amendment Order,
2017 and clause 3(1) (i) of the FTO. 1993 now reads as under:
3.
Exemption from the application of rules. ‑
(1) Nothing contained in the
Rules shall apply to the import of any goods,
(i) by any person through
the post or otherwise for his personal use subject to compliance of other
Laws/Rules/ Orders/Regulations in force.
6.2 Further, vide
notification 16/2015-20 dated 12th July 2017, DGFT
has removed the value cap of Rs 2000 w.r.t to personal imports, as well as,
fully aligned the chapter notes in ITC (HS) with those enacted under Chapter 98
of the Customs Tariff Act.
7. In view of the above, the
instruction 9/2017 -Customs dated 5th July 2017 has become
obsolete and is rescinded.
8. To ensure that there is no undervaluation
by unscrupulous importers, officers may be advised to strictly follow the
provisions of Section 14 of the Customs Act, 1962 read with Customs Valuation
(Determination of Value of Imported Goods) Rules. 2017 for valuation of imports
through courier and posts.
9. Difficulties if any, may be brought to the
notice of the Board.
10. Hindi version follows.
F. No: 451/04/2020-Cus.V
(Temsunaro Jamir)
Additional Commissioner
(ICD)
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