Government of India
Ministry of Finance
Department of Revenue
Tax Research Unit
***
Circular No. 41/2013-Customs
R.No.146 I, North Block
New Delhi, dated the 21st October, 2013
To
The Chief Commissioner of Customs (All)
The Chief Commissioner of Customs & Central Excise (All)
The Director General (All)
Sir/Madam,
Subject: Applicable CVD on Steam Coal imported from Indonesia under FTA
notification No. 46/2011-Customs-reg.
I am directed to invite your attention to the above mentioned subject.
- Under
notification No. 12/2012-Customs, dated 17-03-2012 (S. No. 123 of the
Table), Steam Coal falling under sub-heading 27011920 attracts basic customs
duty (BCD) at 2% and countervailing duty (CVD) at 2%. Steam Coal imported from
Indonesia enjoys preferential BCD @ 0% under S. No. 207 of
notification No.
46/2011-Customs, dated 1st June 2011 (India-ASEAN FTA). In this connection, a
doubt has been raised whether an importer, while availing of the BCD exemption @
0% under FTA (notification No. 46/2011-Customs), can simultaneously avail of the
concessional CVD @ 2% as per notification No. 12/2012-Customs, or he has to pay
the CVD at 6%, which is the rate of excise duty applicable on Steam Coal when
Cenvat facility has not been availed of.
- The matter has been examined by the Ministry. Under the Free Trade Agreement
(FTA), the preference / concession is extended only in respect of BCD. All other
duties, including CVD are charged as applicable to similar imports from other
countries. The CVD on an imported article is levied at a rate equal to the
excise duty leviable on a like article, if produced or manufactured in India.
However, at times, under a notification issued under section 25(1) of the
Customs Act, 1962, CVD is levied at a rate which is lower than the rate of
excise duty leviable on the like domestic article.
- In the present case, the excise duty applicable on Steam Coal is 6%, if
CENVAT benefit is availed of and 1% if the CENVAT benefit is not availed of.
Normally, Steam Coal will suffer 6% CVD, as the condition of non-availment of
cenvat benefit cannot be satisfied in respect of imported goods. However, in the
Budget 2013-14, as a conscious policy decision, it was decided to levy 2% CVD
both on steam coal and bituminous coal. This is the general applied rate of CVD
on all imports of steam coal and bituminous coal regardless of the excise duty
leviable on like domestic coal. No such condition has been laid down that an
importer cannot avail of this concessional CVD of 2% if he has availed of the
concessional BCD on steam coal under another notification.
- It is therefore clarified that an importer while availing of BCD exemption on
steam coal under FTA notification No. 46/2011-Cus can simultaneously avail of
concessional CVD at 2% under notification No. 12/2012-Cus.
- Difficulties, if any, faced in the implementation of above instructions may
be brought to the notice of the Ministry at an early date.
Yours faithfully,
(P. K. Mohanty)
Joint Secretary (TRU)
Tel: 2309 2687
Fax: 2309 2031
F.No.354/58/2013-TRU