Date of Applicability of Amendments in Custom and Central Excise Duty

The Finance Minister has introduced the Finance Bill, 2012 in Lok Sabha today, i.e., 16^th March, 2012. Changes in Customs and Central excise law and rates of duty have been proposed through the Finance Bill, 2012 [clauses 114 to 126 for customs; clauses 127 to 142 for Central Excise and clauses 151, 152, 154 to 156 for miscellaneous changes)]. In order to prescribe effective rates of duty and to carry out changes in the Rules made under the respective Acts, the following notifications are being issued:

CUSTOMS:	Notification Nos.	Date
Tariff	No. 10/2012-Customs to No. 22/2012-Customs	17th March, 2012
Non-Tariff	No. 20/2012-Customs(NT) to No. 22/2012-Customs (NT)	17th March, 2012
CENTRAL EXCISE
Tariff	No. 5/2012-CE to No. 19/2012-CE	17th March, 2012
Non-Tariff	No. 7/2012-CE (NT) to No. 18 /2012-CE (NT)	17th March, 2012
M&TP
Tariff	No. 1/2012 –M&TP	17th March, 2012

 Unless otherwise stated, all changes in rates of duty take effect from the midnight of 16^th March/17^th March, 2012. A declaration has been made under the Provisional Collection of Taxes Act, 1931 in respect of clauses 127, 128, 140, 141 and 151 of the Finance Bill, 2012 so that changes proposed therein also take effect from the midnight of 16^th March/17th March, 2012. The remaining legislative changes would come into effect only upon the enactment of the Finance Bill, 2012. Retrospective amendments in the provisions of law or notifications issued under the respective Acts shall have the force of law only upon the enactment of the Finance Bill, 2012 but with effect from the date indicated in the relevant clause or Schedule. These dates may be carefully noted.

Courtesy:- Tax Guru

Budget 2012 – Important changes in respect of Custom Duty

1. Rate structure:

1.1 There is no change in the peak rate of basic customs duty of 10% applicable to non­agricultural goods with few exceptions which are separately discussed. The rates below the peak are also being retained. Notification no. 21/2002-Customs dated 1.3.2002 prescribing the general effective rates is being superceded by Notification No. 12/2012-Customs dated 17.3.2012.

2.          Computation of Customs Duties:

19.1 The method of computation of Education Cess and Secondary & Higher Education cess on imported goods is being simplified. Currently, these cesses are first charged on the CVD portion of customs duty and thereafter on the aggregate of customs duties (excluding special CVD). The portion of cesses leviable on the CVD portion of customs duty is being exempted so as to avoid computation of such cesses twice.

Illustration:

		Present	Proposed
A	Assessable value (CIF + Landing Charges)	100	100
B	Basic customs duty (BCD) 10%	10.00	10.00
C	Value for CVD (A+B)	110.00	110.00
D	CV D equivalent to central excise duty 10%	11.00	11.00
E	Educational Cess on CVD 2%	0.22	0
F	Sec. and Higher Educational Cess 1%	0.11	0
G	Customs duty for calculation of Cess	21.33	21
H	Customs Educational cess 2%	0.43	0.42
I	Customs Secondary and higher educational cess 1%	0.21	0.21
J	Value for SAD	121.97	121.64
K	SAD @ 4%	4.88	4.865
	Total Duty	26.85	26.495

3. Special Additional Duty:

3.1 Notification Nos. 20/2006-Customs dated 1.3.2006 and 29/2010-Customs dated 27.2.2010 are being superceded by notification no.21/2012-Customs dated 17.3.2012 which prescribes the effective rates of SAD.

3.2       Brass scrap, wood in the rough, dredgers and equipments for setting up of solar thermal projects are being fully exempted from SAD.

3.3      The existing exemption from special additional duty of customs (SAD) currently available to CRGO steel is being restricted to prime quality of such steel.

3.4 A condition is being inserted in Notification No.21/2012-Customs dated 17^th March, 2012 requiring the importer of specified goods to declare the State of destination where the goods are intended to be sold for the first time after import and the VAT registration number. This condition would apply to such goods imported on or after 1^st May, 2012.

3.5 As mentioned above, CENVAT Credit Rules are being amended to permit transfer of unutilized credit of SAD lying in balance at the end of each quarter to other registered premises of the same manufacturer. This change would come into effect from 1.4.2012. [Notification No.21/2012 –CE (NT) dated 17^th March, 2012 refers]

4. Baggage Allowance: The duty-free allowance under the Baggage Rules is being increased from ` 25000 to ` 35000 for passengers of Indian origin and from ` 12000 to ` 15000 for children upto 10 years of age.

5.         Rate changes on Specific Items:

5.1       Increases:

5.2.      The basic customs duty/CVD is being increased on the following items:

• From 60% to 75% on Completely Built Units (CBUs) of large cars/ MUVs/ SUVs permitted for import without type approval (value exceeding US$40,000 and engine capacity exceeding 3000cc for petrol and 2500cc for diesel)
• from 5% to 7.5% on boric acid
• From Nil to 10% on Digital Still Cameras of certain specifications.
• From 5% to 7.5% on flat rolled products (HR and CR) of non-alloy steel is being increased
• From 2% to 4% on standard gold bars and platinum bars
• From 5% to 10% on non-standard gold
• From 1% to 2% on gold ore/concentrate and dore bars for refining(CVD)
• Basic customs duty of 2% is being imposed on cut and polished coloured gemstones.

[Notification No. 12/2012-Customs dated 17^th March, 2012 has been issued for this purpose].

• From 10% to 30% on bicycles and from 10% to 20%. on parts of bicycles [Clause 127]

As the said clause has been declared under the Provisional Collection of Taxes Act, 1931, this increase in duty would take effect immediately- from the midnight of 16^th/17^th March, 2012.

6. Textile Machinery:

6.1 Full Basic Customs Duty exemption has been provided to shuttle less looms, parts/components of shuttle less looms by actual users for manufacture, specified silk machinery viz. Automatic reeling/ dupion reeling machines and their accessories including cocoon assorting machines, cocoon peeling machines, vacuum permeation machine, cocoon cooking machine, reeled silk humidifier, bale press and raw silk testing equipments. The exemption is available only to new machinery.

6.2 The concessional 5% duty available to specified textile machinery under erstwhile Notification. No. 21/2002-Customs dated 1.3.2002, superseded by Notification no.12/12- Customs dated 17^th March,2012 is being restricted only to the new textile machinery. Consequently second hand machinery would attract 7.5%. basic customs duty.

7. Relief Measures:

7.1.        Full exemption from basic customs duty is being provided to certain items as under:

• Initial setting up and substantial expansion of fertilizer projects. The exemption would be valid till 31.03.2015.
• Steam coal. CVD is also being reduced from 5% to 1% on such coal. This dispensation would be valid upto 31 .3.2014.
• Natural gas/Liquified Natural Gas imported for power generation by a power generation company.
• Uranium concentrate, sintered natural uranium dioxide, sintered uranium dioxide pellets for generation of nuclear power.
• Steel tube & wire, cobalt chromium tube, Hayness Alloy-25 and polypropylene mesh for the manufacture of coronary stents/coronary stent systems and artificial heart valves subject to actual user condition.
• Equipment imported for road construction projects awarded by Metropolitan Development Authorities along with Nil CVD and Nil SAD
• Tunnel excavation and specified lining equipment along with Nil CVD and Nil SAD
• Coal mining projects
• New and retreaded aircraft tyres along with Nil CVD.
• Parts of aircraft and testing equipment for maintenance and repair of aircraft imported by third-party Maintenance, Repair and Overhaul (MRO) units.
• Tunnel boring machines for hydel and road projects for all infrastructure projects. The exemption is also being provided to parts required for assembly of such machines.
• Tri- band phosphor
• Waster paper
• Lithium ion batteries for the manufacture of battery packs for supply to electric or hybrid vehicle manufacturers along with 6% CVD and Nil SAD

7.2 The basic customs duty is being reduced on the following items:

(i) From 30%/15% to 10% on,-

• Isolated soya protein and soya protein concentrate
• Probiotics.

(ii) From 10% to 7.5% on,-

• Railway safety (Train Protection and Warning System) equipment and railway track laying machines
• Machinery and instruments for surveying and prospecting of mines
• Titanium Dioxide

(iii)From 10%/ 7.5% to 5%, on-

• Specified coffee plantation and processing machinery. The concessional duty would be available upto 31.3.2014.
• Coffee brewing and vending machines (commercial type). The concessional duty would be available upto 31.3.2014.
• Specified soluble fertilizers and liquid fertilizers, other than urea.
• Raw materials for the manufacture of intermediates, parts and sub-parts of blades for rotors for wind energy generators.
• Six specified life saving drugs/vaccines and their bulk drugs is being reduced from 10% to 5% with Nil CVD by way of excise duty exemption
• Iodine.

(iv) From 7.5% /5% to 2.5%, on-

• Sugarcane planter, root or tuber crop harvesting machine and rotary tiller & weeder, parts & components for their manufacture.
• Parts required for manufacture of such coffee vending and brewing machines (commercial type).
• Specified raw materials for the manufacture of syringes, needles, catheters, cannulae along with Nil SAD and 6% CVD subject to actual user condition
• Parts and components for the manufacture of blood pressure monitors and blood glucose monitoring systems (Gluco-meters) along with Nil SAD and 6% CVD.
• Capital goods, plant and equipment imported for setting up or substantial expansion of iron ore pellet plants or iron ore beneficiation plants
• Specified soluble fertilizers and liquid fertilizers, other than urea.

8. Other Project Imports:

8.1 At present, project import status is available to installation of Mechanized Handling Systems & Pallet Racking Systems in mandis or warehouses for food grains and sugar, with concessional rate of basic customs duty of 5% with full exemption from additional duty of customs (CVD) and special additional duty of customs (SAD). This exemption is being extended to such systems installed for handling horticultural produce.

8.2       Project imports status with 5% BCD is being granted to the green houses set up for protected cultivation of horticulture and floriculture produce.

[Notification No. 17 /2012-Customs and Notification No. 12/2012 –Customs both dated 17^th March, 2012 has been issued for this purpose].

9. Important Legislative Amendments:

9.1 Barring legislative amendments involving an increase in the rate of duty for which a suitable declaration has been made under the Provisional Collection of Taxes Act, all amendments would come into effect on the date of enactment of the Finance Bill, 2012 i.e. the date on which the Bill receives the assent of the President. The legislative amendments relating to Customs Act and Customs Tariff Act have been explained in the Explanatory Memorandum to the Finance Bill, 2012. The important ones are discussed/ highlighted below:

9.2       Sections 2 and 7 are being amended to include ^„airfreight stations^‟ [Clause 114 and 115]

9.3 A new section 28AAA is being inserted to provide for recovery of duties, from the person to whom the instrument such as duty credit scrips was issued, where the instrument was obtained by means of collusion or wilful mis-statement or suppression of facts by the such person without prejudice to any action that may be taken against the importer. [Clause 116]. Section 28BA is being amended to make the provisions relating to provisional attachment of property applicable to the proposed Section 28AAA [Clause 116].

9.4 Section 47 is being amended to insert a new proviso therein to provide that the Central Government may, by notification in the official gazette, specify the class or classes of importers who shall pay customs duty electronical ly.[Clause1 18]

9.5 Section 104 is being amended to provide that notwithstanding anything contained in the Code of Criminal Procedure, 1973, all offences under the Act (except an offence punishable with term of imprisonment of three years or more under section 135) shall be non-cognizable and bailable. It also provides that all offences punishable with a term of imprisonment of three years or more under section 135 shall be cognizable.[Clause 120].

9.6 Section 104A is being inserted to provide that bail in the case of offences punishable with a term of imprisonment of three years or more under section 135 shall not be granted by a Court or Magistrate without an opportunity being given to the Public Prosecutor to present his case. However in the case of minors, infirm and women the Magistrate may grant bail. It also excludes the jurisdiction of police officers to initiate investigation in cases under the Customs Act, unless authorized in this behalf by the Central Government by a special or general order [Clause 121]

9.7 Section 122 is being amended to enhance the monetary limits for adjudication of cases involving confiscation of goods and imposition of penalty from Rupees two lakh to Rupees five lakh for Deputy! Assistant Commissioners and from ` 10,000 to ` 50,000 for Gazetted officer lower in rank to Assistant! Deputy Commissioner. [Clause 122]

9.8 Section 138 deals with summary trial of offences. This section is being amended to exclude offences punishable with term of imprisonment of three years or more under section 135 since it is being proposed that such offences shall be cognizable. [Clause 123]

9.9       Section 153 is being amended to bring ^„courier services^‟ within its ambit for the purpose
of serving any order!decision!summons!notice by the Commissioner. [Clause 124]

10. Amendments in the First Schedule and Second Schedule to the Customs Tariff Act.

10.1     The First schedule to the Customs Tariff Act is being amended to,-

• revise the length of the lowest slab of both filter and non-filter cigarettes of length not exceeding 60 millimetres or exceeding 60 millimetres to length exceeding or not exceeding 65 millimetres
• revise the description of tariff items 2601 11 10 to 2601 11 90 dealing with iron ore and concentrates based on Fe content
• insert Note 13 in Chapter 48 to provide that notwithstanding anything contained in Note 12, if the paper and paper products of heading 4811, 4816 or 4820 are printed with any character, name, logo, motif or format they shall remain classified under Chapter 48 as long as such products are intended to be used for further printing. This would prevent classification disputes.
• align the entries relating to copper scrap, brass scrap, nickel scrap, aluminium scrap, lead scrap and zinc scrap with the revised ISRI classification. [Clause 127]

10.2 The Second Schedule to the Customs Tariff Act is being amended to enhance the rate of export duty on chromium ore from ` 3000 per tonne to 30% ad valorem. [Clause 128] This change will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931.

11 .    Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996

11.1 The Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 is being amended to further liberalize and simplify the procedure. The important changes are as under:

•  Eligibility Certificate can be obtained for a period not exceeding a year instead of consignment wise or quarterly certificate at present;

• Permitting re-export of unused! rejected goods imported at concessional duty under the said Rules with the prior permission of the jurisdictional Assistant Commissioner of Deputy Commissioner of Central Excise, as the case may be, subject to the condition that-

• Such re-export takes place within six months from the date of importation
• The re-export value should not be less than the value of the imports.

·  Maintenance of separate accounts for these rules should not be insisted upon as long as the records maintained by the importer contain the requisite information.

 Courtesy:- Tax Guru

Key Features of Budget 2012-13 on Tax Front

INCOME TAX

1. Income tax exemption limit raised to Rs.2 lakh to provide relief of relief of Rs.2,000 for assessee in this category; 20 percent tax on income over Rs.10 lakh, up from Rs.8 lakh.

2. No change in corporate tax

3. Deduction of up to Rs.10,000 from interest from savings bank accounts

4. Withholding tax on external commercial borrowings reduced from 20 percent to five percent for power, airlines, roads, bridges, affordable houses and fertiliser sectors for a period of three years

5. New equity savings scheme (RAJIV GANDHI EQUITY SCHEME) to provide for income tax deduction of 50 percent for those who invest Rs.50, 000 in equity and whose annual income is less than Rs.10 lakh.

6. Proposal to allow deduction of upto `5,000 for preventive health check up.

7. Senior citizens not having income from business proposed to be exempted from payment of advance tax.

8. Investment link deduction of capital expenditure for certain businesses proposed to be provided at the enhanced rate of 150 per cent.

9. Proposal to extend weighted deduction of 200 per cent for R&D expenditure in an in-house facility for a further period of 5 years beyond March 31, 2012.

10. Turnover limit for compulsory tax audit of account and presumptive taxation of SMEs to be raised from  Rs. 60 lakh to Rs. 1 Crore.

11. Exemption from Capital Gains tax on sale of residential property, if sale consideration is used for subscription in equity of a manufacturing SME for purchase of new plant and machinery.

12. Proposal to provide weighted deduction at 150 per cent of expenditure incurred on skill development in manufacturing sector.

13. Re-open tax assessment for 15 years of overseas assets

14.Reduction in securities transaction tax by 20 per cent on cash delivery transactions.

15. Restriction on Venture Capital Funds to invest only in 9 specified sectors proposed to be removed.

16. Proposal to extend the levy of Alternate Minimum Tax to all persons, other than companies, claiming profit linked deductions.

17.Proposal to introduce General Anti Avoidance Rule to counter aggressive tax avoidance scheme.

CUSTOMS DUTY

18. Customs duty reduced from 7.5% to 2.5% for iron ore equipment

19. Customs duty on gold, platinum raised to 4% from 2%

20. Duty on tobacco in packets raised

21. No change proposed in the peak rate of customs duty of 10 per cent on non¬agricultural goods.

22. Cuts customs duty on rail equipment to 7.5% from 10%

23. Mobile phone parts exempted from basic customs duty 24. Thermal power companies exempted from full tax for 2 yrs 25.LCD and LED panels exempted from custom duty 26.No change in peak custom duty

EXCISE DUTY

27. Standard rate of excise duty to be raised from 10 per cent to 12 per cent, merit rate from 5 per cent to 6 per cent and the lower merit rate from 1 per cent to 2 per cent with few exemption

28. Excise duty on large cars also proposed to be enhanced

29. Branded silver jewellery fully exempt from excise duty

30.12% excise duty imposed on branded retail garments

SERVICE TAX

31 .All services to be taxed except the ones in negative list

32. School education exempt from service tax

33. Some infra construction services exempt from service tax

34.Propose to raise service tax rate from 10per cent to 12 per cent, with corresponding changes in rates for individual services.

35. Utilization of input tax credit permitted in number of services to reduce cascading of taxes.

36. New scheme announced for simplification of refunds.

OTHERS

37. Non tax revenue receipts at 1.65 lac cr; Gross taxes estimate at 10.6 of GDP

38. Interest subsidy on loan farm extended; 1% loan subsidy on home loans upto Rs 15 lac

39. No case of polio reported in the last 1 yr due to government prevention efforts UID allocation at Rs 14,232 cr for FY13

40. Mid-day meal program has improved enrolment and nutrition of children

41. Focus on micro-irrigation scheme projects; financing to be raised

42. Kisan credit card scheme will be modified

43. Work to improve farm technology; protein supplement to increase productivity

44. To work on National food security system; sustainable agriculture; oil seeds to increase productivity

45.Agriculture to be priority; initiative of green revolution has increased paddy production

46. Double tax free infra bonds to Rs 60,000 cr in FY12

47.To reduce cost of ATF; proposal to allow foreign investment in airlines at 49% 48. Increase investments in infrastructure through PPP

49.Rs 15,888 cr for capitalization of PSUs

50. Introduce new law for microfinance; to allow QFIs in bond market

51.Rs 30,000 cr for disinvestment in FY1 3

52. Have to fast rack policy decisions; effort on for consensus on FDI

53.GST rollout in March also awaits expert recommendations and will be operational in Aug 2012

54. DTC was intended for April rollout but will need more time

55.Mobile based fertilizer management system to be provided for transparent transfer of subsidy

56. Subsidies related to food will be extended under the Food Security Act and will be 2% of the GDP

57. Higher outlay in oil subsidies needed because of global price rise expected and avoid shock

58. Current account deficit for FY1 2 likely to be at 3.6%

59. Keeping in mind all global and domestic affects expect FY12 GDP at 7.6%, plus-minus 0.2%

60. Deal with malnutrition; coordinated implementation of delivery system and address problem of black m

61. Recognized goals for 12th 5 yr plan – Domestic demand driven growth recovery; increase private investment

62. FY1 2 GDP growth seen at 6.9%

63.Global economic crisis and political crisis injected uncertainty in the Indian economy

C.A. DAMODAR PRASAD AGRAWAL

PLACE: NEW DELHI

Budget 2012- Chapterwise Explanatory Notes of Customs

EXPLANATORY NOTES (CUSTOMS)

Chapter 1 to 4

No change

Chapter 5

5.1 Basic customs duty on artemia classified under tariff item 0511 99 11 is being reduced from 30% to 5%. [S.No. 15 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 6 to 18

No change

Chapter 19 to 20 

No change

Chapter 21

21.1 Basic customs duty on Soya protein Concentrate classified under 2106 10 00 is being reduced from 30% to 10%. [S. No 91 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 22 to 25 

No change

Chapter 26

26.1. Basic customs duty is being increased on gold ores and concentrates for use in the manufacture of gold from 1% to 2%. [S. No 116 of notification No. 12/2012-Customs dated 17.03.2012 refers]

26.2    The description of goods classified in tariff item 2601 11 10 to 2601 11 90 is being revised [Clause 127 read with Third Schedule to the Finance Bill 2012 refers].

26.3 Export duty on “chrom um ores and concentrates, a l sorts is being enhanced from Rs. 3000 per tonne to 30% ad valorem [Clause 128 read with Fourth Schedule to the Finance Bill 2012 refers].

26.4 Basic Customs duty on nickel ore & concentrate classified under tariff item 2604 00 00 is being fully exempted. [S. No 118 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 27

27.1 Steam Coal classified under CTH 2701 19 20 is being fully exempted from basic customs duty alongwith 1% CVD. This dispensation would be valid upto 31^st March, 2014. [S. No 123 of notification No. 12x/2012-Customs dated 17.03.2012 refers]

27.2        Basic customs duty Liquefied Natural Gas (LNG) and Natural Gas (NG) (2711),
is being fully exempted when imported for generation of electrical energy by a power generating company [S. No139 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 28

28.1 Basic customs duty on nickel oxide & hydroxide classified under 2825 40 00 is being reduced from 7.5% to ^„Nil^‟. [S. No 161 of notification No.12/2012-Customs dated 17.03.2012 refers]

28.2 Basic customs duty on Ammonium Metavanadate, classified under heading 2841, is being reduced from 7.5% to 2.5%. [S. No 162 of notification No. 12/2012- Customs dated 17.03.2012 refers]

28.3          Basic customs duty on Iodine classified under 2801 20 00 is being reduced to 2.5 %. [S. No 156 of notification No. 12/2012-Customs dated 17.03.2012 refers]

28.4 Basic customs duty on Titanium dioxide classified under CTH 2823 00 10 is being reduced from 10% to 7.5%. [S. No 150 of notification No. 12/2012-Customs dated 17.03.2012 refers]

28.5 Basic customs duty on Boric Acid classified under CTH 2810 00 20 is being enhanced from 5% to 7.5%. [S. No 150 of notification No. 12/2012-Customs dated 17.03.2012 refers]

28.6 Basic customs duty on Sintered natural uranium dioxide/ Sintered uranium dioxide pellets (U-235) classified under CTH 2844 20 00 for use in the production of nuclear power is being reduced from 7.5% to Nil. [S. No163 of notification No. 12/2012- Customs dated 17.03.2012 refers]

Chapter 29

No change

Chapter 30

30.1 The Concessional rate of 5% of basic customs duty is being extended to six life saving drugs/vaccines and their bulk drugs used in the manufacture of said drugs. [S. No176 to 181 of list appended to notification No. 12/2012-Customs dated 17.03.2012 refers]

30.2 Basic Customs duty on probiotics classified under 3002 90 30 is being reduced from 10% to 5% [S. No 195 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 31

31.1 Basic customs duty on specified water soluble and liquid fertilizers is being reduced from 7.5% to 5% and from 5% to 2.5%. [S. No 202 of notification No. 12/2012- Customs dated 17.03.2012 refers]

Chapter 32

32.1 Triband Phosphor classified under CTH 3206 50 00 is being fully exempted from basic customs duty [S. No209 of notification No. 12/2012-Customs dated 17.03.2012 refers]

32.2 Basic customs duty on Organic / Inorganic Coating material for manufacture of electrical steel (CTH 3209) is being reduced from 10% to 5% on actual user basis [S. No212 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 33 to 34

No Change

Chapter 35

35.1 Basic customs duty on Isolated soya protein classified under 3504 00 91 is being reduced from 15% to 10%. [S. No21 6 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 36 to 38

No Change

Chapter 39

39.1 Basic customs duty on Super Absorbent Polymer (SAP) classified under 3906 90 90 imported for use in the manufacture of Adult Diapers is being reduced from 7.5% to 5% alongwith Nil SAD on actual user basis [S.No242 of notification No. 12/20 12- Customs dated 17.03.2012 refers]

Chapter 40

40.1 Basic customs duty and additional customs on pneumatic tyres (new or retreaded) for aircraft is being fully exempted subject to conditions [S.Nos.249 &250 of notification No. 12/2012 customs dated 17.03.2012 refers]

Chapter 41 to 43

No Change

Chapter 44

44.1 Wood in rough falling under heading 4403 has been exempted from Special CVD. [S. No 56 of notification No. 21/2012-Customs dated 17.03.2012 refers]

Chapter 45 to 46

No Change

Chapter 47

47.1. Basic Customs duty on waste paper, falling in heading 4707, is being fully exempted from basic customs duty. [S. No.262 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 48

48.1. A chapter note in chapter 48 is being inserted to provide that if paper and paper products of headings 4811, 4816 or 4820 are printed with any character, name, logo, motif or format, they shall remain classified under chapter 48 as long as such products intended to be used for further printing.” [Clause 127 read with Third Schedule to the Finance Bill 2012 refers].

Chapter 49 to 50

No Change

Chapter 51

51.1 Basic customs duty on Wool Waste (CTH 5103) is being reduced from 10% to 5%. [S. No279 of notification No. 12/2012-Customs dated 17.03.2012 refers]

51.2 Basic customs duty on Wool Tops (CTH 5105) is being reduced from 15% to 5%. [S. No 281 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 52 to 53

No Change

Chapter 54

54.1 Basic Customs duty on Aramid thread/ Yarn/ fabric for manufacture of Bullet proof helmets for Defence and Police personnel is being reduced from 10% to Nil with Nil CVD and Nil SAD (S. No. 16 of Notification No.39/96-Customs dated 23rd July, 1996 as inserted vide Notification No.11 /2012-Customs dated 17th March, 2012 refers).

Chapter 55

No Change

Chapter 56

56.1 Basic customs duty on Hydrophilic Non –Woven, Hydrophobic Non –Woven ( CTH 56031100) imported for use in the manufacture of Adult Diapers is being reduced from 10% to 5%, With 5% CVD and Nil SAD on actual user basis [S. No295 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 57 to 70

No Change

Chapter 71

71.1 Basic customs duty is being increased on gold dore bars having gold content not exceeding 95%, imported for refining and manufacturing serially numbered gold bars in India from 1% to 2% [S. No 318 of notification No. 12/2012-Customs dated 17.03.2012 refers]

71.2  Basic customs duty is being increased on Gold bars, other than tola bars, bearing manufacturer^‟s or refiner^‟s engraved serial number and weight expressed inmetric units, and gold coins having gold content not below 99.5% from 2% to 4%. [S. No321 & 323 of notification No. 12/2012-Customs dated 17.03.2012 refers]

71.3 Basic customs duty is being increased on Gold in any form other than above, including tola bars and ornaments, but excluding ornaments studded with stones or pearls from 5% to 10%.

71.4 Basic customs duty is being increased on Platinum from 2% to 4%. [S. No328 of notification No. 12/2012-Customs dated 17.03.2012 refers]

71.5        Basic customs duty of 2% is being prescribed for Cut and polished coloured gemstones. [S. No 313 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 72

72.1 Basic Customs duty on flat-rolled products of non-alloy steel whether or not clad, plated or coated falling in headings 7208, 7209, 7210, 7211, and 7212 is being increased from 5% to 7.5%. [S. No 334 of notification No. 12/2012-Customs dated 17.03.2012 refers]

72.2 Prime quality cold rolled sheets of grain oriented (CRGO) Silicon electrical steel falling under tariff item 7225 11 00 or 7226 11 00 has been exempted from Special CVD. [S. No 79 of notification No. 21/2012-Customs dated 17.03.2012 refers]

Chapter 73

73.1 Basic Customs duty on pipes and tubes for use in manufacture of boilers falling in chapter 73 of the customs tariff, has been reduced from 10% to 7.5%. [S. No335 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 74

74.1 The description of goods falling in tariff item nos. 7404 00 12 and 7404 00 22 of the customs tariff has been aligned with revised ISRI code [Clause 128 read with Third Schedule to the Finance Bill 2012 refers].

74.2 Brass Scrap falling under tariff item 7404 00 29 has been exempted from Special CVD. [S. No 80 of notification No. 21/2012-Customs dated 17.03.2012 refers]

Chapter 75

75.1 The description of goods falling in tariff item no. 7503 00 10 of the customs tariff has been aligned with revised ISRI code [Clause 128 read with Third Schedule to the Finance Bill 2012 refers].

Chapter 76

76.1 The description of goods falling in tariff item no. 7602 00 10 of the customs tariff has been aligned with revised ISRI code [Clause 128 read with Third Schedule to the Finance Bill 2012 refers].

Chapter 78

78.1 The description of goods falling in tariff item no. 7802 00 10 of the customs tariff has been aligned with revised ISRI code [Clause 128 read with Third Schedule to the Finance Bill 2012 refers].

Chapter 79

79.1 The description of goods falling in tariff item no. 7902 00 10 of the customs tariff has been aligned with revised ISRI code [Clause 128 read with Third Schedule to the Finance Bill 2012 refers].

Chapter 84

84.1 Basic customs duty on Marine seawater pumps with fibre impellers and Automatic fish/prawn feeder is being reduced from 10% to 5%. [S. No348 of notification No. 12/2012-Customs dated 17.03.2012 refers]

84.2 Basic customs duty is being reduced from 7.5% to 2.5% on specified Agriculture Machinery viz. Sugarcane planter, Root or tuber crop harvesting machines and Rotary tiller/ weeder. Parts and components required for manufacture of these items would also attract BCD@ 2.5%. [S. No399 of notification No. 12/2012-Customs dated 17.03.2012 refers]

84.3 The Concessional import duty regime of 5% basic Customs Duty + Nil CVD +SAD presently applicable to food grains and sugar under project imports scheme is being extended to goods required for installation of mechanized handling systems and pallet racking systems in mandis and warehouses for horticulture produce [S. No515 of notification No. 12/2012-Customs dated 17.03.2012 and notification No. 17/2012- Customs dated 17.03.2012 refers]

84.4 Full exemption from basic customs duty exemption is being provided to shuttle less looms, parts/components of shuttle less looms by actual users for manufacture, specified silk machinery viz. Automatic reeling silk reeling and processing machinery and their accessories including cocoon assorting machines, cocoon peeling machines, vacuum permeation machine, cocoon cooking machine, reeled silk humidifier, bale press and raw silk testing equipments.[S. No.406 of notification No. 12/2012-Customs dated 17.03.2012 refers]. The existing concessional duty rate extended to specified textile machinery is being restricted only to new textile machinery.

84.5 A concessional rate of 5% BCD is being extended to raw materials, intermediates required for the manufacture of parts of blades for rotors of wind operated generators. [S. No 362 of notification No. 12/2012-Customs dated 17.03.2012 refers]

84.6 An unconditional full exemption from Basic Customs Duty and additional duty of customs (CVD) is being provided to tunnel boring machines and parts and components thereof for use in the assembly of Tunnel boring machines. [S. No 397 of notification No. 12/2012-Customs dated 17.03.2012 refers] In addition the full exemption from basic customs duty and CVD is being extended to Tunnel Excavation & Lining Equipments consisting of Drilling Jumbos, Loaders, Tunnel excavators, Shotcrete Machines and 3 Stage Crushers for use in highway development projects [S. No 368 of notification No. 12/2012-Customs dated 17.03.2012 refers]

84.7 The benefit of existing exemption from Customs duty on Road Construction equipment is being extended to projects awarded by Metropolitan Development Authority also. [S. No 368 of notification No. 12/2012-Customs dated 17.03.2012 refers]

84.8 Basic customs duty on Power weeding machine for coffee plantations, Coffee grinder,     Coffee processing machine, sprayers, Coffee packaging machine, Coffeebagging machine and mechanical harvester for coffee plantation is being reduced from 7.5% to 5% [S. No 384 of notification No. 12/2012-Customs dated 17.03.2012 refers]

84.9 Basic customs duty on Coffee vending machine and brewing machines other than of a kind used for domestic purpose is being reduced from 10% to 5%. A concessional rate of BCD of 2.5% is also being provided to parts required for the manufacture of such machines. [S. No 385 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 85:

85.1 Full exemption from basic customs duty, additional duty of customs presently available on parts, components and accessories of mobile handsets including cellular phones is being extended to parts, components and sub-parts of parts and components required for manufacture of Memory Cards for mobile phones [S. No 431 of notification No. 12/2012-Customs dated 17.03.2012 refers]

85.2 Full exemption from Special Additional Duty of customs on parts, components and accessories of mobile handsets including cell phones valid up to 31.3.13 is being been extended to parts, sub-parts and components of Memory Cards for mobile handsets including cellular phones. The validity of this exemption is being extended upto 31.3.2013. [S. No 5 of notification No. 21/2012-Customs dated 17.03.2012 refers]

85.3 The exemption from basic customs duty on poly laminated aluminium tape and poly laminated steel tape is being withdrawn. [Notification No. 25/2005-Customs dated 1.03.2005 as amended by notification No. 15/2012-Customs dated 17.03.2012 refers]

85.4 The customs duty exemption provided for specified raw materials for use in electronics/IT industry is being withdrawn [Notification No. 25/1999-Customs dated 28.02.1999 as amended by notification No. 16/2012-Customs dated 17.03.2012 refers]

85.5 Excise duty is being reduced to 6% on LED lamps & LEDs required for manufacture of such lamps and SAD is being fully exempted on LEDs used for manufacture of LED Lamps [S. No 90 of notification No. 21/2012-Customs dated 17.03.2012 refers]

85.6 Full exemption from Basic Customs Duty is being extended to LCD and LED TV panels for 20 inches and above. [S. No 432 of notification No. 12/2012-Customs dated 17.03.2012 refers]

85.7 Basic customs duty of 10% is being imposed on Digital Cameras which are capable of recording video with minimum resolution of 800 x 600 pixels, at minimum 23 frames per second, for at least 30 minutes in a single sequence using the maximum storage (including expanded) capacity. [Notification No. 25/2005-Customs dated 1.03.2005 as amended by notification No. 15/2012-Customs dated 17.03.2012 refers]. Basic Customs Duty on parts and components of such cameras is being reduced to 5% subject to actual user condition [S. No 429 of notification No. 12/2012-Customs dated 17.03.2012 refers]

85.8 Basic customs, additional customs duty and special additional duty of customs (SAD) on Lithium ion automotive battery for manufacture of Li ion battery packs for supply to hybrid/electric vehicle manufacture is being reduced from 10% to Nil, 10% to 6% and 4% to Nil respectively [S. No 438 of notification No. 12/2012-Customs dated 17.03.2012 and S. No 6 of notification No. 21/2012-Customs dated 17.03.2012 refers]

Chapter 86

86.1 Basic customs duty on Track Machines and parts classified under CTH 86 is being reduced from 10% to 7.5% [S. No 436 of notification No. 12/2012-Customs dated 17.03.2012 refers]

86.2 Basic customs duty on Train Protection and Warning System is being reduced from 10% to 7.5%. [S. No 435 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 87

87.1 Basic customs duty on CBUs of motor vehicles (cars) falling under CTH 8703 with FOB value more than US $ 40000 and with engine capacity more than 3000cc for petrol-run vehicles and more than 2500 cc for diesel-run vehicles is being increased from 60% to 75%. [S. No 437 of notification No. 12/2012-Customs dated 17.03.2012 refers]

87.2 Basic customs, additional customs duty and special additional duty of customs (SAD) on specific parts of hybrid vehicles is being reduced from 10% to Nil, 10% to 6% and 4% to Nil respectively [S. No 440 of notification No. 12/2012-Customs dated 17.03.2012 and S. No 8 of notification No. 21/2012-Customs dated 17.03.2012 refers]

87.3 Basic customs duty on Bicycles in fully built condition as well as in form of CKD/SKD kits is being increased from 10% to 30%. [Bill entry]

87.4 Basic customs duty on Bicycles parts and components is being increased from 10% to 20%. [S. No 444 of notification No. 12x/2012-Customs dated 17.03.2012 refers]

Chapter 88

88.1 Basic customs and additional customs duty on imports of Parts and testing equipment, by a third party Maintenance Repair, and Overhauling facility for aircraft falling under heading 8802 is being fully exempted [S. No 448 of notification No.12/2012-Customs dated 17.03.2012 refers]

88.2 The period of stay for duty free import of aircraft not registered or intended to be registered in India for a flight to or across India, is being reduced from six months to 15 days or as extended by the competent Authority not exceeding 60 days[S. No 450 of notification No. 12/2012-Customs dated 17.03.2012 refers]

Chapter 89

89.1 Unconditional exemption form CVD is being extended on import of foreign going vessels for a period from 01.03.2011 to 17.03.2012. [Bill entry]

89.2 Additional Customs duty (CVD) on Foreign going vessels imported into India are being fully exempted subject to payment of duty at the time of its conversion for coastal run. [S. No 462 of notification No. 12/2012-Customs dated 17.03.2012 refers]

89.3 Dredgers are being fully exempted from Special Additional customs duty [S. No 97 of notification No. 21/2012-Customs dated 17.03.2012 refers]

89.4 Additional Customs duty (CVD) on dredgers imported into India is being rationalised for import of dredgers on lease and contractual basis and on short term basis. [Notification Nos. 19/2012-Customs and 20/2012-Customs both dated 17.03.2012 refer]

Chapter 90

90.1 Basic Customs Duty is being reduced to 2.5% along with 6%CVD and Nil SAD on specified raw materials viz. Polypropylene, Stainless Steel Strip and Stainless Steel capillary tube for manufacture of syringe, needle, catheters, and cannulae on actual user basis. [S. No 475 of notification No. 12/2012-Customs dated 17.03.2012 refers]

90.2 Full exemption from basic customs duty, CVD and SAD is being provided to specified raw materials viz. stainless steel tube and wire, cobalt chromium tube, Hayness Alloy-25 and polypropylene mesh required for manufacture of Coronary stents/ coronary stent system and artificial heart valve on actual user basis. [S. No 476 of notification No. 12/2012-Customs dated 17.03.2012 refers]

90.3 Basic Customs Duty is being reduced to 2.5% with 6% CVD and Nil SAD on parts of Blood Pressure Monitors and Blood glucose monitoring systems (Gluco­meters) on actual user basis [S. No 477 of notification No. 12/2012-Customs dated 17.03.2012 refers]

90.4 BCD is being reduced to 2.5% ad valorem on survey(DGPS) instruments, 3D modeling software for ore body simulation cum mine planning and exploration (geophysics and geochemistry) equipment. [S. No 489 of notification No. 12/2012- Customs dated 17.03.2012 refers]

CHAPTER 91-97

91-97     

No change

CHAPTER 98

(Project Imports)

 98.1 Project import status is being granted for Green Houses set up for protected cultivation of Horticulture and Floriculture produce [S. No 515 of notification No. 12/2012-Customs dated 17.03.201 2and notification No. 42/96-Customs dated 23.07.1996 as amended by notification No. 17/2012-Customs dated 17.03.2012 refers]

 98.2 Basic Customs Duty (BCD) is being reduced to Nil for initial setting up as well as substantial expansion of all fertilizer projects for a period of 3 years i.e. up to of 31.3.2015. [S. No506 of notification No. 12/2012-Customs dated 17.03.2012 refers]

 98.3 Basic Customs Duty (BCD) is being reduced to 2.5% for the capital goods/ equipments required for setting up or substantial expansion of iron ore pellet plants & iron ore beneficiation plants. [S. No506 of notification No. 12/2012-Customs dated 17.03.2012 refers]

98.4           Full Basic Customs Duty (BCD) exemption is being extended to Coal Mining Projects. [S. No506 of notification No. 12/2012-Customs dated 17.03.2012 refers]

 98.5 Project Import status is being granted to mechanized handling systems and pallet racking systems for horticulture produce. [Notification No. 17/2012-Customs dated 17.03.2012 refers]

Courtesy:- Tax Guru