Unit 2

Framework of Statutes
 THE FOREIGN TRADE (DEVELOPMENT AND REGULATION) ACT, 1992 No.22
OF 1992
(7th August, 1992)

An Act to provide for the development and regulation of foreign trade by

facilitating imports into, and augmenting exports from India and for matters
connected therewith or incidental thereto.

Be it enacted by Parliament in the Forty-third Year of the

Republic of India as follows:-

Short title and commencement
(1) This Act may be called the Foreign Trade (Development and Regulation)
Act, 1992.
(2) Sections 11 to 14 shall come into force at once and the remaining
provisions of this Act shall be deemed to have come into force on the 19th
day of June 1992.
Definitions.
2. In this Act, unless the context otherwise requires:-
(a) "Adjudicating Authority" means the authority specified in, or under,
section 13;
(b) "Appellate Authority" means the authority specified in , or under, sub-
section (1) of section 15;
(c) "conveyance" means any vehicle, vessel, aircraft or any other means of
transport including any animal;
(d) "Director General" means the Director General of ForeignTrade
appointed under section
(e) "import" and "export" means respectively bringing into, or taking out of,
India any goods by land. sea or air;
(f) "Importer-exporter Code Number" means the Code Number granted
under section 7;
(g) "licence" means a licence to import or export and includes a customs
clearance permit and any other permission issued or granted under this Act;
(h) "Order" means any order made by the Central Government under
section 3; and
(i) "Prescribed" means prescribed by rules made under this Act.
 CHAPTER II
POWER OF CENTRAL GOVERNMENT TO MAKE ORDERS AND ANNOUNCE
EXPORT AND IMPORT POLICY

Powers to make provision relating to imports and exports.

(1) The Central Government may by Order published in the Official Gazette,
make provision for the development and regulation of foreign trade by
facilitating imports and increasing exports.

(2) The Central Government may also, by Order published in the Official
Gazette, make provision for prohibiting. Restricting or otherwise regulating, in
all cases or in specified classes of cases and subject to such exeptions, if any,
as may be made by or under the Order, the import or export of goods.
(3) All goods to which any Order under sub-section (2) applies shall be
deemed to be goods the import or export of which has been prohibited
under section 11 of the Customs Act, 1962 and all the provisions of that Act
shall have effect accordingly.

Continuance of existing orders

4. All Orders made under the Imports and Exports (Control) Act, 1947 and in
force immediately before the commencement of this Act shall, so far as they
are not inconsistent with the provisions of this Act, continue to be in force
and shall be deemed to have been made under this Act.
Export and import policy.
5. The Central Government may, from time to time, formulate and announce
by notification in the Official Gazette, the export and import policy and may
also, in the like manner, amend that policy.
Appointment of Director General and his functions.
6. (1) The Central Government may appoint any person to be the Director
General of Foreign Trade for the purposes of this Act.

(2) The Director General shall advise the Central Government in the
formulation of the export and import policy and shall be responsible for
carrying out that policy.

(3) The Central Government may, by Order published in the Official Gazette
direct that any power exercisable by it under this Act (other than the powers
under sections 3,5,15,16 and 19) may also be exercised, in such cases and
subject to such conditions, by the Director General or such other officer
subordinate to the Director General, as may be specified in the Order.
CHAPTER III
IMPORTER-EXPORTER CODE NUMBER AND LICENCE

Importer-exporter Code Number.

7. No person shall make any import or export except under an Importer-
exporter Code Number granted by the Director General or the officer
authorised by the Director General in this behalf, in accordance with the
procedure specified in this behalf by the Director General.

Suspension and cancellation of Importer-exporter Code Number.

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8. (1) Where :-
(a) any person has contravened any law relating to Central excise or customs
or foreign exchange or has committed any other economic offence under any
other law for the time being in force as may be specified by the Central
Government by notification in the Official Gazette, or

(b) The Director General has reason to believe that any person has made an
export or import in a manner gravely prejudicial to the trade relations of
India with any foreign country or to the interests of other persons engaged in
imports or exports or has brought disrepute to the credit or the goods of the
country, the Director General may call for the record or any other information
from that person and may, after giving to that person a notice in writing
informing him of the grounds on which it is proposed to suspend or cancel
the Importer-exporter Code
Number and giving him a reasonable opportunity of making a representation
in writing within such reasonable time as may be specified in the notice and, if
that person so desires, of being heard, suspend for a period, as may be
specified in the order, or cancel the Importer-exporter Code Number granted
to that person.

(2) Where any Importer-exporter Code Number granted to a person has been
suspended or cancelled under sub-section (1), that person shall not be
entitled to import or export any goods except under a special licence, granted,
in such manner and subject to such conditions as may be prescribed, by the
Director General to that person.
9. (1) The Central Government may levy fees, subject to such exceptions, in
respect of such person or class of persons making an application for a license
or in respect of any license granted or renewed in such manner as may be
prescribed.

(2) The Director General or an officer authorized by him may, on an

application and after making such inquiry as he may think fit, grant or renew
or refuse to grant or renew a license to import or export such class or classes
of goods as may be prescribed, after recording in writing his reasons for such
refusal.

(3) A license granted or renewed under this section shall -

(a) be in such form as may be prescribed;
(b) be valid for such period as may be specified therein;
(c) be subject to such terms, conditions and restrictions as may be prescribed
or as specified in the license with reference to the terms, conditions and
restrictions so prescribed.

(4) The Director General or the officer authorised under sub-section (2) may,
subject to such conditions as may be prescribed for good and sufficient
reasons, to be recorded in writing suspend or cancel any license granted under
this Act:
Provided that no such suspension or cancellation shall be made except after
giving the holder of the license a reasonable opportunity of being heard.

(5) An appeal against an order refusing to grant, or renew or suspending or

cancelling, a license shall lie in like manner as an appeal against an order
would lie under
section 15.
 CHAPTER IV
SEARCH, SEIZURE, PENALTY AND CONFISCATION

Power relating to search and seizure

10. (1) The Central Government may, by notification in the Official Gazette,
authorize any person for the purposes of exercising such powers with respect
to entering such premises and searching inspecting and seizing of such goods,
documents, things and conveyances subject to such requirements and
conditions, as may be prescribed.
(2) The provisions of the Code of Criminal Procedure, 1973 relating to
searches and seizures shall, so far as may be, apply to every search and
seizure made under this section. Contravention of provisions of this Act, rules,
orders and export and import policy.
11. (1) No export or import shall be made by any person except in accordance
with the provisions of this Act, the rules and orders made there under and the
export and import policy for the time being in force.

(2) Where any person makes or abets or attempts to make any export or import
in contravention of any provision of this Act or any rules or orders made
thereunder or the export and import policy, he shall be liable to a penalty not
exceeding one thousand rupees or five times the value of the goods in respect
of which any contravention is made or attempted to be made, whichever is
more.

(3) Where any person, on a notice to him by the Adjudicating Authority, admits
any contravention, the Adjudicating Authority may, in such class or classes of
cases and in such manner as may be prescribed, determine, by way of
settlement, an amount to be paid by that person.
(4) A penalty imposed under this Act may, if it is not paid, be recovered as an
arrear of land revenue and the Importer-exporter Code Number of the person
concerned, may, on failure to pay the penalty by him, be suspended by the
Adjudicating Authority till the penalty is paid.

(5) Where any contravention of an provision of this Act or any rules or orders
made thereunder or the export and import policy has been, is being or is
attempted to be made, the goods together with any package, covering or
receptacle and any conveyances shall, subject to such requirements and
conditions as may be prescribed, be liable to confiscation by the Adjudicating
Authority.

(6) The goods or the conveyance confiscated under sub-section

(5) may be released by the Adjudicating Authority, in such manner and subject
to such conditions as may be prescribed, on payment by the person concerned
of the redemption charges equivalent to the market value of the goods or
conveyance, as the case may be.
Penalty or confiscation not to interfere with other punishments.

12. No penalty imposed or confiscation made under this Act shall prevent the
imposition of any other punishment to which the person affected thereby is
liable under any other law for the time being in force.
 Adjudicating Authority

13. Any penalty may be imposed or any confiscation may be adjudged under this Act
by the Director General or, subject to such limits as may be specified, by such other
officer as the Central Government may by notification in the Official Gazettte,
authorise in this behalf.

Giving of opportunity to the owner of the goods, etc.

14. No order imposing a penalty or of adjudication of confiscation shall be made
unless the owner of the goods or conveyance or other person concerned, has been
given a notice in writing -
(a) informing him of the grounds on which it is proposed to impose a penalty or to
confiscate such goods or conveyance; and
(b) to make a representation in writing within such reasonable time as may be
specified in the notice against the imposition of penalty or confiscation mentioned
therein, and, if he so desired, of being heard in the matter.
14. No order imposing a penalty or of adjudication of confiscation shall be
made unless the owner of the goods or conveyance or other person
concerned, has been given a notice in writing -

(a) informing him of the grounds on which it is proposed to impose a penalty

or to confiscate such goods or conveyance; and

(b) to make a representation in writing within such reasonable time as may be

specified in the notice against the imposition of penalty or confiscation
mentioned therein, and, if he so desired, of being heard in the matter.

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 International trade law
International Trade Law includes the appropriate rules and customs for
handling trade between countries. However, it is also used in legal writings as
trade between private sectors, which is not right.

This branch of law is now an independent field of study as most governments

have become part of the world trade, as members of the
World Trade Organization (WTO).

Since the transaction between private sectors of different countries is an

important part of the WTO activities, this latter branch of law is now a very
important part of the academic works and is under study in many universities
across the world.
World Trade Organization
In 1995, the World Trade Organization, a formal international organization to
regulate trade, was established. It is the most important development in the
history of international trade law. The purposes and structure of the
organization is governed by the Agreement Establishing The World Trade
Organization, also known as the "Marrakesh Agreement".

It does not specify the actual rules that govern international trade in specific
areas.
These are found in separate treaties, annexed to the Marrakesh Agreement.
Scope of WTO :
(a) provide framework for administration and implementation of agreements;
(b) forum for further negotiations; (c) trade policy review mechanism; and (d)
promote greater coherence among members economics policies
Principles of the WTO:
(a) Principle of non-discrimination (most-favoured-nation treatment
obligation and the national treatment obligation)
(b) Market access (reduction of tariff and non-tariff barriers to trade)
(c) Balancing trade liberalisation and other societal interests
(d) Harmonisation of national regulation (TRIPS agreement, TBT agreement,
SPS agreement)
 Foreign Trade Policy (FTP)
LEGAL FRAMEWORK

1.00 Legal Basis of Foreign Trade Policy (FTP)

The Foreign Trade Policy, in exercise of powers conferred under Section 5 of
the Foreign Trade (Development & Regulation) Act, 1992 (No. 22 of 1992) [FT
(D&R) Act], as amended.
1.01 Duration of FTP
FTP 2023 is a dynamic and open ended Policy that will accommodate the
emerging needs
Aim of FTP 2023:
• To enhance the competitiveness of Indian exports in the global market
(India’s overall exports are about to reach US $760 billion this year)
• Promote sustainable development of the country’s trade sector
• Make India a leader in specific sectors such as pharmaceuticals,
engineering goods, and textiles
• To promote a digital economy and leverage technology to enhance the
competitiveness of Indian exports.

The Key Approach to the policy is based on these 4 pillars:

• An incentive to Remission (Reduction/cancellation of a debt, duty, or
penalty)
• Export promotion through collaboration – Exporters, States, Districts,
Indian Missions
• Ease of doing business, reduction in transaction cost and e-initiatives and
Emerging Areas – E-Commerce Developing Districts as Export Hubs and
streamlining SCOMET (Special Chemicals, Organism, Materials, Equipment
and Technologies) policy
 Major Features of FTP 2023:
Feature Description Significance
It will also
The new policy focuses on export encourage
Process Re- promotion and development through MSMEs to
Engineering and automated IT systems for various participate in
Automation approvals, making it easier for MSMEs the global
and others to access export benefits. market.

Four new towns (Faridabad, Mirzapur,

Moradabad, and Varanasi) have been It will boost the
Towns of designated as Towns of Export Excellence exports of
Export (TEE) in addition to the existing 39 handlooms,
Excellence towns. The TEEs will have priority access to handicrafts, and
export promotion funds under the MAI carpets.
(Market Access Initiative (MAI) ) scheme.
 This will help
India build
Exporter firms recognized with ‘status’ (e.g. 2- a skilled
Recognitio star, 4-star, 5-star ratings) based on export manpower
n of performance will now help in skilling and pool capable of
Exporters training (similar to the ‘each one teach servicing a $5
one’ initiative) Trillion
economy before
2030.
The FTP aims at building partnerships with It will help
Promoting State governments and taking forward in identifying
export the Districts as Export Hubs (DEH) initiative to and promoting
from the promote exports at the district level and local
districts accelerate the development of the grassroots products and
trade ecosystem. services.
 India is placing more emphasis on A robust export control
the “export control” regime to system in India would
comply with the international provide access to dual-
treaties and
Streamlini into by India.agreements entered use High-end goods and
ng SCOMET: “Special Chemicals, technologies to Indian
SCOMET Organism, Materials, Equipment and exporters while
Policy Technologies” items are dual-use facilitating exports of
items having the potential for both controlled
civilian applications as well as items/technologies under
SCOMET from India.
weapons of mass destruction.
 The EPCG Scheme, which allows the import of capital goods at
zero Customs duty for export production, is being further
rationalized.
Additional schemes such as the PM MITRA scheme have been
cilitation under added to claim benefits under the Common Service Provider It will promote
the Export scheme. domestic
Promotion of manufacturing and
Capital Goods Battery Electric Vehicles, Vertical Farming equipment, encourage investment
(EPCG) Scheme Wastewater Treatment and Recycling, Rainwater harvesting in capital goods.
systems, and Green Hydrogen are added to Green Technology
products – will now be eligible for reduced Export Obligation
requirements under EPCG Scheme

Facilitation It will promote

under the AAS provides duty-free import of raw materials for domestic
Advance manufacturing export items. manufacturing and
authorization It has been now extended to the export of the Apparel and encourage investment
Scheme (AAS) Clothing sector in the textile sector.
 Merchanting trade involves the shipment of
goods from one foreign country to another foreign It will help convert
country without touching Indian ports, involving an financial centres such
Merchanting Indian intermediary. as GIFT city etc. into
trade major merchanting
Merchanting trade of restricted and prohibited hubs as seen in places
items under the export policy would now be like Dubai, Singapore
possible. and Hong Kong.

Similar to the “Vivaad se Vishwaas“ initiative, the It will help

government has introduced a special one-time in reducing
Amnesty Scheme under which Exporters who have litigation and
been unable to meet their obligations under EPCG and fostering trust-
Amnesty Advance Authorizations can be regularised on payment based
Scheme of all customs duties exempted in proportion to relationships to
unfulfilled export obligations. help alleviate the
The interest payable is capped at 100% of these issues faced by
exempted duties under this scheme. exporters.
FTP 2023 codifies implementation mechanisms in a paperless, online
environment, building on earlier 'ease of doing business' initiatives.
Reduction in fee structures and IT-based schemes will make it easier for
MSMEs and others to access export benefits.
Duty exemption schemes for export production will now be implemented
through Regional Offices in a rule-based IT system environment, eliminating
the need for manual interface. During the FY23-24, all processes under the
Advance and EPCG Schemes, including issue, re-validation, and EO extension,
will be covered in a phased manner. Cases identified under risk management
framework will be scrutinized manually, while majority of the applicants are
expected to be covered under the 'automatic' route initially.
Some key features of the new Foreign Trade Policy:

Towns of Export Excellence

Four new towns, namely Faridabad, Mirzapur, Moradabad, and Varanasi, have
been designated as Towns of Export Excellence (TEE) in addition to the
existing 39 towns. The TEEs will have priority access to export promotion
funds under the MAI scheme and will be able to avail Common Service
Provider (CSP) benefits for export fulfillment under the EPCG Scheme. This
addition is expected to boost the exports of handlooms, handicrafts, and
carpets.
 Recognition of Exporters
Exporter firms recognized with 'status' based on export performance will
now be partners in capacity-building initiatives on a best-endeavor basis.
Similar to the 'each one teach one' initiative, 2-star and above status
holders would be encouraged to provide trade-related training based on a
model curriculum to interested individuals. This will help India build a
skilled manpower pool capable of servicing a $5 Trillion economy before
2030. Status recognition norms have been re-calibrated to enable more
exporting firms to achieve 4 and 5-star ratings, leading to better branding
opportunities in export markets.
Promoting export from the districts
The FTP aims at building partnerships with State governments and taking
forward the Districts as Export Hubs (DEH) initiative to promote exports at
the district level and accelerate the development of grassroots trade
ecosystem. Efforts to identify export worthy products & services and
resolve concerns at the district level will be madethrough an institutional
mechanism – State Export Promotion Committee and District Export
Promotion Committee at the State and District level, respectively.District
specific export action plans to be prepared for each district outlining the
district specific strategy to promote export of identified products and
services.
Streamlining SCOMET Policy
India is placing more emphasis on the "export control" regime as its
integration with export control regime countries strengthens. There is a
wider outreach and understanding of SCOMET (Special Chemicals,
Organisms, Materials, Equipment and Technologies) among stakeholders,
and the policy regime is being made more robust to implement
international treaties and agreements entered into by India.A robust
export control system in India would provide access of dual-use High end
goods and technologies to Indian exporters while facilitating exports of
controlled items/technologies under SCOMET from India.
Facilitating E-Commerce Exports
E-commerce exports are a promising category that requires distinct policy interventions from
traditional offline trade. Various estimates suggest e-commerce export potential in the range
of $200 to $300 billion by 2030. FTP 2023 outlines the intent and roadmap for establishing e-
commerce hubs and related elements such as payment reconciliation, book-keeping, returns
policy, and export entitlements. As a starting point, the consignment wise cap on E-
Commerce exports through courier has been raised from ₹5Lakh to ₹10 Lakh in the FTP
2023. Depending on the feedback of exporters, this cap will be further revised or eventually
removed.Integration of Courier and Postal exports with ICEGATE will enable exporters to
claim benefits under FTP. The comprehensive e-commerce policy addressing the
export/import ecosystem would be elaborated soon, based on the recommendations of the
working committee on e-commerce exports and inter-ministerial deliberations.Extensive
outreach and training activities will be taken up to build capacity of artisans, weavers,
garment manufacturers, gems and jewellery designers to onboard them on E-Commerce
platforms and facilitate higher exports.
Facilitation under Export Promotion of Capital Goods (EPCG) Scheme
The EPCG Scheme, which allows import of capital goods at zero Customs duty
for export production, is being further rationalized. Some key changes being
added are:
Prime Minister Mega Integrated Textile Region and Apparel Parks (PM MITRA)
scheme has been added as an additional scheme eligible to claim benefits
under CSP(Common Service Provider) Scheme of Export Promotion capital
Goods Scheme(EPCG).
Dairy sector to be exempted from maintaining Average Export Obligation – to
support dairy sector to upgrade the technology.
Battery Electric Vehicles (BEV) of all types, Vertical Farming equipment,
Wastewater Treatment and Recycling, Rainwater harvesting system and
Rainwater Filters, and Green Hydrogen are added to Green Technology
products – will now be eligible for reduced Export Obligation requirement
under EPCG Scheme
Facilitation under Advance authorization Scheme
Advance authorisation Scheme accessed by DTA units provides duty-free
import of raw materials for manufacturing export items and is placed at a
similar footing to EOU and SEZ Scheme. However, the DTA unit has the
flexibility to work both for domestic as well as export production. Based on
interactions with industry and Export Promotion councils, certain facilitation
provisions have been added in the present FTP such as
Special Advance Authorisation Scheme extended to export of Apparel and
Clothing sector under para 4.07 of HBP on self-declaration basis to facilitate
prompt execution of export orders – Norms would be fixed within fixed
timeframe.
Benefits of Self-Ratification Scheme for fixation of Input-Output Norms
extended to 2 star and above status holders in addition to Authorised
Economic Operators at present.
Merchanting trade
To develop India into a merchanting trade hub, the FTP 2023 has
introduced provisions for merchanting trade. Merchanting trade of
restricted and prohibited items under export policy would now be
possible. Merchanting trade involves shipment of goods from one foreign
country to another foreign country without touching Indian ports,
involving an Indian intermediary. This will be subject to compliance with
RBI guidelines, and won’t be applicable for goods/items classified in the
CITES and SCOMET list. In course of time, this will allow Indian
entrepreneurs to convert certain places like GIFT city etc. into major
merchanting hubs as seen in places like Dubai, Singapore and Hong Kong.
Amnesty Scheme
Finally, the government is strongly committed to reducing litigation and
fostering trust-based relationships to help alleviate the issues faced by
exporters. In line with "Vivaad se Vishwaas" initiative, which sought to settle
tax disputes amicably, the governmentis introducing a special one-time
Amnesty Scheme under the FTP 2023to address default on Export
Obligations.

This scheme is intended to provide relief to exporters who have been unable
to meet their obligations under EPCG and Advance Authorizations, and who
are burdened by high duty and interest costs associated with pending cases.

All pending cases of the default in meeting Export Obligation (EO) of

authorizations mentioned can be regularized on payment of all customs
duties that were exempted in proportion to unfulfilled Export Obligation.
The interest payable is capped at 100% of these exempted duties under this
scheme. However, no interest is payable on the portion of Additional
Customs Duty and Special Additional Customs Duty and this is likely to
provide relief to exporters as interest burden will come down substantially.It
is hoped that this amnesty will give these exporters a fresh start and an
opportunity to come into compliance.
8.1 "Deemed Exports" refers to those transactions in which the goods
supplied do not leave the country and the payment for such supplies is
received either in Indian rupees or in free foreign exchange.

8.2 e Supply of capital goods, including in unassembled/ disassembled

condition as well as plants, machinery, accessories, tools, dies and such
goods which are used for installation purposes till the stage of commercial
production and spares to the extent of 10% of the FOR value to fertiliser
plants.
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What does 'Free On Board - FOB' mean
Free on board (FOB) is a trade term that indicates whether the seller or the
buyer has liability for goods that are damaged or destroyed during shipment
between the two parties. "FOB shipping point" (or origin) means that the
buyer is at risk while the goods are shipped, and "FOB destination" states
that the seller retains the risk of loss until the goods reach the buyer.
Custom Act, 1962

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Customs Act, 1962 came into force from 1-2-1963. It extends to
whole of India. The whole Act is divided into XVII chapters
comprising of 161 sections.

The Customs Act was enacted in 1962 with an objective to consolidate and
modify the legal principles relating to customs.

The Act provides for the appointment of different classes of officers by the
Central Board of Excise and Customs to serve the duties in the customs
department.
The Act further provides for the assigning of customs ports and airports for
the loading and unloading of commodities, warehousing location, coastal
ports for trade in coastal commodities etc.

The Commissioner of Customs is empowered to grant the landing place for

commodities and indicate the restrictions of custom area.

The Central Government shall restrict the transfer of certain specified

commodities for safeguarding security of the nation and public order,
conserving decency and integrity, protection of foreign exchange,
prevention of destruction to Indian economy, preservation of agricultural
products and fisheries etc.
Custom Act, 1962

In this Act, unless the context otherwise requires, - (1) "adjudicating

authority" means any authority competent to pass any order or decision
under this Act, but does not include the Board Commissioner (Appeals) or
Appellate Tribunal;

(1A) "aircraft" has the same meaning as in the Aircraft Act, 1934 (22
of 1934);

(1B) "Appellate Tribunal" means the Customs, Excise an Gold

(Control) Appellate Tribunal constituted under section 129;
(3) "baggage" includes unaccompanied baggage but does not include motor
vehicles;
(6) "Board" means the Central Board of Excise and Customs
constituted under the Central Boards of Revenue Act, 1963 (54 of
1963);
(7) "coastal goods" means goods, other than imported goods,
transported in a vessel from one port in India to another;
(7A) "Commissioner (Appeals)" means a person appointed to be a
Commissioner of Customs (Appeals) under sub-section (1) of section
4;
(8) "Commissioner of Customs", except for the purposes of Chapter
XV, includes an Additional Commissioner of Customs;
(10) "customs airport" means any airport appointed under clause (a) of
section 7 to be a customs airport;
(11) "customs area" means the area of a customs station and includes
any area in which imported goods or export goods are ordinarily kept
before clearance by Customs Authorities;
(12) "customs port" means any port appointed under clause (a) of
section 7 to be a customs port and includes a place appointed under
clause (aa) of that section to be an inland container depot;
(13) "customs station" means any customs port, customs airport or
land customs station;
(14) "dutiable goods" means any goods which are chargeable to duty
and on which duty has not been paid;
(15) "duty" means a duty of customs leviable under this Act
(17) "examination", in relation to any goods, includes measurement
and weighment thereof;
(18) "export", with its grammatical variations and cognate expressions
means taking out of to a place outside India;
(19) "export goods" means any goods which are to be taken out of
India to a place outside India;
(20) "exporter", in relation to any goods at any time between their entry
for export and the time when they are exported, includes any owner or
any person holding himself out to be the exporter;
(21) "foreign-going vessel or aircraft" means any vessel or aircraft for
the time being engaged in the carriage of goods or passengers
between any port or airport in India and any port or airport outside
India, whether touching any intermediate port or airport in India or not,
and includes –
(i) any naval vessel of a foreign Government taking part in any naval
exercises;
(ii) any vessel engaged in fishing or any other operations outside the
territorial waters of India;
(iii) any vessel or aircraft proceeding to a place outside India for any
purpose whatsoever;
(23) "import", with its grammatical variations and cognate expressions,
means bringing into India from a place outside India;
(24) "import manifest" or "import report" means the manifest or report
required to be delivered under section 30;
(25) "imported goods" means any goods brought into India from a place
outside India but does not include goods which have been cleared for
home consumption;
(26) "importer", in relation to any goods at any time between their
importation and the time when they are cleared for home consumption,
includes any owner or any person holding himself out to be the importer;
(27) "India" includes the territorial waters of India;
(28) "Indian customs waters" means the waters extending into the sea
up to the limit of contiguous zone of India under section 5 of the
Territorial Waters, Continental Shelf, Exclusive Economic Zone and
Maritime Zones Act, 1976 (80 of 1976) and includes any bay, gulf,
harbour, creek or tidal river;

(33) "prohibited goods" means any goods the import or export of which is
subject to any prohibition under this Act or any other law for the time being
in force but does not include any such goods in respect of which the
conditions subject to which the goods are permitted to be imported or
exported have been complied with;
(39) "smuggling", in relation to any goods, means any act or omission which
will render such goods liable to confiscation under section 111 or section
113;

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Classes of Officers of Customs. –
There shall be the following classes of officers of customs,
namely :-
(a) Chief Commissioners of Customs;
(b) Commissioners of Customs;
(c) Commissioners of Customs (Appeals);
(cc) Joint Commissioners of Customs;
(d) Deputy Commissioners of Customs;
(e) Assistant Commissioners of Customs; and
(f) such other class of officers of customs as may be appointed for
the purposes of this Act.
 Rules of Origin

Definition
Rules of origin are the criteria needed to determine the national source of a product.
Their importance is derived from the fact that duties and restrictions in several cases
depend upon the source of imports.

There is wide variation in the practice of governments with regard to the rules of
origin. While the requirement of substantial transformation is universally recognized,
some governments apply the criterion of change of tariff classification, others the ad
valorem percentage criterion and yet others the criterion of manufacturing or
processing operation. In a globalizing world it has become even more important that
a degree of harmonization is achieved in these practices of Members in
implementing such a requirement.
Where are rules of origin used?
Rules of origin are used:

— to implement measures and instruments of commercial policy such as

anti-dumping duties and safeguard measures;

— to determine whether imported products shall receive most-favoured-

nation (MFN) treatment or preferential treatment;

— for the purpose of trade statistics;

— for the application of labelling and marking requirements; and

— for government procurement.

No specific provision in GATT
GATT has no specific rules governing the determination of the country of origin of goods
in international commerce. Each contracting party was free to determine its own origin
rules, and could even maintain several different rules of origin depending on the
purpose of the particular regulation. The draftsmen of the General Agreement stated
that the rules of origin should be left:

“...within the province of each importing country to determine, in accordance with the
provisions of its law, for the purpose of applying the most-favoured-nation provisions
(and for other GATT purposes), whether goods do in fact originate in a particular
country”.
In the late 1980s developments in three important areas served to focus more attention on
the problems posed by rules of origin:

Increased number of preferential trading arrangements

First, an increased use of preferential trading arrangements, including regional
arrangements, with their various rules of origin;

Increase in the number of origin disputes

Second, an increased number of origin disputes growing out of quota arrangements such as
the Multifibre Arrangement and the “voluntary” steel export restraints; and

Increased use of anti-dumping laws

Lastly, an increased use of anti-dumping laws, and subsequent claims of circumvention of
anti-dumping duties through the use of third country facilities.
Institutions
WTO Committee on Rules of Origin
The Agreement establishes a Committee on Rules of Origin within the framework of
the WTO, open to all WTO Members. It is to meet at least once a year and is to review
the implementation and operation of the Agreements (Article 4:1).

WCO Technical Committee

A Technical Committee on Rules of Origin is created under the auspices of the World
Customs Organization (formerly the Customs Cooperation Council). Its main functions
are (a) to carry out the harmonization work; and (b) to deal with any matter
concerning technical problems related to rules of origin. It is to meet at least once a
year. Membership is open to all WTO Members; other WCO members and the WTO
Secretariat may attend as observers (Article 4:2 and Annex I).