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Government of India
Ministry of Finance
Department of Revenue
(Central Board of Excise and Customs)
Circular No. 48/2017-Customs
Room 227B, North Block
New Delhi, dated the 8th December, 2017
To
All Principal Chief Commissioner/Chief Commissioner of Customs /Custom (Preventive),
All Principal Chief Commissioner/Chief Commissioner of Central Tax.
All Principal Commissioner/Commissioner of Customs / Customs (Preventive),
All Principal Commissioner/ Commissioner of Central Tax.
Sir /Madam,
Subject: Clarification on Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017—reg
Kind reference is drawn to
Notification No. 68/2017-Customs (N.T.) dated 30.06.2017.
notifying Customs (Import of Goods at Concessional Rate of Duty)
Rules, 2017.
2. As per sub-rule (2) of rule 5 of Customs (Import of Goods at Concessional Rate of Duty) 2017, an importer in order to avail exemption provided vide
notification issued under sub-section (1) of section 25 of the Customs Act is required to submit such surety or security as deemed appropriate by the
Deputy Commissioner of Customs or Assistant Commissioner of Customs having jurisdiction over the premises where the imported goods shall he put to use
for manufacture of goods or for rendering output services.
3. CBEC has received various references stating that the provision of submission of surety or security in the rules, is posing a major challenge for
domestic industry particularly electronic hardware manufacturers as submission of surety increases the transaction cost hampering their efforts to
optimize the manufacturing capacity.
4. In this regard, it is worth while to mention that the option to furnish surety or security along with the Bond is given, in order to facilitate
manufacturers and service providers keeping in view the different business environments in which the entrepreneurs function and also to protect the
interests of revenue. However. keeping in view the objective of the Government to further simplify the business procedures and to reduce the burden
of compliance cost, CBEC has decided to further ease the norms for taking security/ surety along with the Bond.
5. In view of the above, Bank Guarantee/ cash security/ surety shall be taken as per the following norms for the purpose of extending the benefit
under the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017.
| Category of Importer |
Quantum of Bank Guarantee/ cash security
and requirement of
Surety |
a) All importer (s) who are either a
department of Central
Government
or a State Government or a Union
Territory or a
Public Sector Undertaking
or an autonomous institute under the
said governments |
Bank Guarantee/ Cash Security- Nil Surety- Not required. |
| b) All importers who are Authorized Economic Operators. |
c) All importers who are manufacturers
or service providers
registered under
GST and have been filing prescribed
GST returns
without fail and whose
annual turnover in the preceding year is above
Rs. 1 crore. |
Importers shall give surety for the amount of duty foregone.
However, where the importer is not able to provide the surety,
a
Bank Guarantee/ Cash Security equivalent to not more than
5% of duty
foregone shall be furnished. |
d) Importers. not covered under (a), (b) & (c)
above. |
Bank Guarantee/ Cash Security- Not more than
25% of the duty
foregone amount |
Explanation: Duty foregone would be calculated by reckoning the duty applicable if the
importer were not to follow the procedure prescribed in the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017.
6. The upper limit of Bank Guarantee/ Cash Security to the extent of 5% and 25% respectively has been fixed unless the Deputy
Commissioner or the Assistant Commissioner has reasons to demand a higher quantum of Bank guarantee/ cash security, in which
case the matter shall be referred to the jurisdictional Commissioner who may order for higher quantum of Bank Guarantee or
cash security, subject to limit of 100% of the total duty foregone, after recording the reasons thereof in writing.
7. In order to avail above exemption/ relaxation from furnishing Bank Guarantee/ Cash security or surety, prosecution should
not have been initiated or launched against the importer under, any Act administered by the Central Board of Excise & Customs.
or State Goods & Service Tax Act or Integrated Goods & Service Tax Act or Union Territory Goods & Service Tax Act during the
previous three financial years.
8. Where an importer so requests, the bank guarantee/ cash security may be taken consignment-wise to obviate the financial burden.
Further, all bank guarantee(s) should have self-renewal clause.
9. All Chief Commissioners are requested to issue suitable standing order, for guidance of the concerned officers. Difficulty,
if any, in implementation of the above directions may be brought to the notice of the Board.
10. Hindi version will follow.
F. No. 450/28/2016-Cus IV
Yours faithfully
(Zubair Riaz)
Director (Customs)
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