Customs Tariff Act, 1975

ACT NO. 51 OF 1975 W.e.f 02.08.1976

SECTION 2. Duties specified in the Schedules to be
levied. - The rates at which duties of customs shall
be levied under the Customs Act, 1962 (52 of 1962),
are specified in the First and Second Schedules.
SECTION 3. Levy of additional duty equal to excise
duty, sales tax, local taxes and other charges
• SECTION 4. Levy of duty where standard rate and
preferential rate are specified
• (2)The Central Government may, by notification in the
Official Gazette, make rules for determining if any article
is the produce or manufacture of any preferential areas.
• (3) For the purposes of this section and the First
Schedule, preferential area means any country or
territory which the Central Government may, by
notification in the Official Gazette, declare to be such
area.
• SECTION 5. Levy of a lower rate of duty under a
trade agreement
• (1) Whereunder a trade agreement between the
Government of India and the Government of a
foreign country or territory, duty at a rate lower
than that specified in the First Schedule is to be
charged on articles which are the produce or
manufacture of such foreign country or territory
• SECTION 6 . Power of Central Government to levy
protective duties in certain cases
• to provide for the protection of the interests of any
industry established in India, the Central
Government may, by notification in the Official
Gazette, impose on any goods imported into India
in respect of which the said recommendation is
made, a duty of customs of such amount, not
exceeding the amount proposed in the said
recommendation, as it thinks fit.
• SECTION 7. Duration of protective duties and
power of Central Government to alter them.
— (1) When the duty specified in respect of
any article in the First Schedule is
characterised as protective in Column (5) of
that Schedule, that duty shall have effect
only up to and inclusive of the date, if any,
specified in that Schedule.
• SECTION 8A. Emergency power of Central Government
to increase import duties
• SECTION 8B. Power of Central Government to impose
safeguard duty
if the Central Government, after conducting such
enquiry as it deems fit, is satisfied that any article is
imported into India in such increased quantities and
under such conditions so as to cause or threatening to
cause serious injury to domestic industry, then, it may,
by notification in the official gazette, impose a safeguard
duty on that article.
• SECTION 9A . Anti- dumping duty on dumped
articles
• (1) Where any article is exported by an exporter or
producer from any country or territory to India at
less than its normal value, then, upon the
importation of such article into India, the Central
Government may, by notification in the Official
Gazette, impose an anti-dumping duty not
exceeding the margin of dumping in relation to
such article.
• (a) “margin of dumping”, in relation to an article, means
the difference between its export price and its normal
value;
• The anti-dumping duty imposed under this section shall,
unless revoked earlier, cease to have effect on the expiry
of five years from the date of such imposition :
• Provided further that where a review initiated before the
expiry of the aforesaid period of five years has not come
to a conclusion before such expiry, the anti-dumping duty
may continue to remain in force pending the outcome of
such a review for a further period not exceeding one year.
 Section 12 of Customs Act- Charging Section

• Charging Section-SECTION 12. Dutiable goods.

- (1) Except as otherwise provided in this Act,
or any other law for the time being in force,
duties of customs shall be levied at such rates
as may be specified under the Customs Tariff
Act, 1975 (51 of 1975), or any other law for
the time being in force, on goods imported
into, or exported from, India.
 Section 14- Valuation of Goods
• SECTION 14. Valuation of goods. - (1) For the purposes of the
Customs Tariff Act, 1975 (51 of 1975), or any other law for the
time being in force, the value of the imported goods and
export goods shall be the transaction value of such goods, that
is to say, the price actually paid or payable for the goods when
sold for export to India for delivery at the time and place of
importation, or as the case may be, for export from India for
delivery at the time and place of exportation, where the buyer
and seller of the goods are not related and price is the sole
consideration for the sale subject to such other conditions as
may be specified in the rules made in this behalf :
 SECTION 15. Date for determination of rate of
duty and tariff valuation of imported goods
• SECTION 15. Date for determination of rate of duty and tariff valuation of
imported goods. - (1) The rate of duty and tariff valuation, if any, applicable to
any imported goods, shall be the rate and valuation in force,
(a) in the case of goods entered for home consumption under section 46, on
the date on which a bill of entry in respect of such goods is presented under
that section];
(b) in the case of goods cleared from a warehouse under section 68, on the
date on which a bill of entry for home consumption in respect of such goods is
presented under that section;
(c) in the case of any other goods, on the date of payment of duty :

Provided that if a bill of entry has been presented before the date of entry
inwards of the vessel or the arrival of the aircraft or the vehicle by which the
goods are imported, the bill of entry shall be deemed to have been presented
on the date of such entry inwards or the arrival, as the case may be.
 Section 16- Date of determination of rate of
duty and tariff valuation of export goods
• SECTION 16. Date for determination of rate of duty and tariff
valuation of export goods.-(1) The rate of duty and tariff valuation, if
any, applicable to any export goods, shall be the rate and valuation
in force, -
(a) in the case of goods entered for export under section 50, on the
date on which the proper officer makes an order permitting
clearance and loading of the goods for exportation under section 51;
(b) in the case of any other goods, on the date of payment of duty.

(2)The provisions of this section shall not apply to baggage and

goods exported by post.
 Section 17- Assessment of Duty
• SECTION 17. Assessment of duty. – (1) An importer entering any imported goods under
section 46, or an exporter entering any export goods under section 50, shall, save as
otherwise provided in section 85, self-assess the duty, if any, leviable on such goods.

(2) The proper officer may verify the the entries made under section 46 or section 50
and the self assessment of goods referred to in sub-section (1) and for this purpose,
examine or test any imported goods or export goods or such part thereof as may be
necessary.

Provided that the selection of cases for verification shall primarily be on the basis of risk
evaluation through appropriate selection criteria.

(3) For the purposes of verification under sub-section (2), the proper officer may require
the importer, exporter or any other person to produce any document or information,
whereby the duty leviable on the imported goods or export goods, as the case may be,
can be ascertained and thereupon, the importer, exporter or such other person shall
produce such document or furnish such information. Contd………
• (4) Where it is found on verification, examination or testing of the
goods or otherwise that the self- assessment is not done correctly,
the proper officer may, without prejudice to any other action which
may be taken under this Act, re-assess the duty leviable on such
goods.

(5) Where any re-assessment done under sub-section (4) is contrary

to the self-assessment done by the importer or exporter and in cases
other than those where the importer or exporter, as the case may
be, confirms his acceptance of the said re- assessment in writing, the
proper officer shall pass a speaking order on the re-assessment,
within fifteen days from the date of re-assessment of the bill of entry
or the shipping bill, as the case may be.
 SECTION 18. Provisional assessment of
duty
• SECTION 18. Provisional assessment of duty- (1) Notwithstanding anything
contained in this Act but without prejudice to the provisions of section 46 and
section 50
(a) where the importer or exporter is unable to make self-assessment under
sub-section (1) of section 17 and makes a request in writing to the proper
officer for assessment; or
(b) where the proper officer deems it necessary to subject any imported
goods or export goods to any chemical or other test; or
(c) where the importer or exporter has produced all the necessary
documents and furnished full information but the proper officer deems it
necessary to make further enquiry; or

(d) where necessary documents have not been produced or information

has not been furnished and the proper officer deems it necessary to make
further enquiry,
Section25-Power to grant exemption from duty

• (1) If the Central Government is satisfied that it is

necessary in the public interest so to do, it may,
by notification in the Official Gazette, exempt
generally either absolutely or subject to such
conditions (to be fulfilled before or after
clearance) as may be specified in the notification
goods of any specified description from the
whole or any part of duty of customs leviable
thereon.
 Section 26. Refund of export duty in certain
cases
• SECTION 26. Refund of export duty in certain cases. - Where on
the exportation of any goods any duty has been paid, such duty
shall be refunded to the person by whom or on whose behalf it
was paid, if -
(a) the goods are returned to such person otherwise than by
way of re-sale;
(b) the goods are re-imported within one year from the date of
exportation; and
(c) an application for refund of such duty is made before the
expiry of six months from the date on which the proper officer
makes an order for the clearance of the goods.
 Section 26A. Refund of import duty in certain cases
• SECTION 26A. Refund of import duty in certain cases- (1) Where on the importation of
any goods capable of being easily identified as such imported goods, any duty has been
paid on clearance of such goods for home consumption, such duty shall be refunded to
the person by whom or on whose behalf it was paid, if-

(a) the goods are found to be defective or otherwise not in conformity with the
specifications agreed upon between the importer and the supplier of goods:
Provided that the goods have not been worked, repaired or used after importation
except where such use was indispensable to discover the defects or non-conformity with
the specifications;
(b) the goods are identified to the satisfaction of the Assistant Commissioner of Customs
or Deputy Commissioner of Customs as the goods which were imported;
(c) the importer does not claim drawback under any other provisions of this Act; and
(d) (i) the goods are exported; or
(ii) the importer relinquishes his title to the goods and abandons them to customs;
or
(iii) such goods are destroyed or rendered commercially valueless in the presence
of the proper officer,
SECTION 27. Claim for refund of duty
• SECTION 27. Claim for refund of duty. – 51[(1) Any
person claiming refund of any duty or interest,-
(a) paid by him; or (b) borne by him,
may make an application in such form and manner as
may be prescribed for such refund to the Assistant
Commissioner of Customs or Deputy Commissioner of
Customs, before the expiry of one year, from the date of
payment of such duty or interest:
• Provided further that the limitation of one year shall not
apply where any duty or interest has been paid under
protest.
• SECTION 27A. Interest on delayed refunds. - If any duty
ordered to be refunded under sub-section (2) of section 27
to an applicant is not refunded within three months from
the date of receipt of application under sub-section (1) of
that section, there shall be paid to that applicant interest at
such rate,59[ not below five percent and not exceeding
thirty percent per annum as is for the time being fixed by
the Central Government by Notification in the Official
Gazette, on such duty from the date immediately after the
expiry of three months from the date of receipt of such
application till the date of refund of such duty :
Section 28 Recovery of duties not levied or not paid or
short-levied or short- paid or erroneously refunded
• (1) Where any duty has not been levied or not paid or short-levied
or short-paid or erroneously refunded, or any interest payable has
not been paid, part-paid or erroneously refunded, for any reason
other than the reasons of collusion or any wilful mis-statement or
suppression of facts,-
(a) the proper officer shall, within two years from the relevant date,
serve notice on the person chargeable with the duty or interest
which has not been so levied or paid or which has been short-levied
or short-paid or to whom the refund has erroneously been made,
requiring him to show cause why he should not pay the amount
specified in the notice;
Provided that before issuing notice, the proper officer shall hold
pre-notice consultation with the person chargeable with duty or
interest in such manner as may be prescribed
Section28AA-Interest on delayed payment of duty
(1) Notwithstanding anything contained in any judgment, decree, order
or direction of any court, Appellate Tribunal or any authority or in any
other provision of this Act or the rules made thereunder, the person,
who is liable to pay duty in accordance with the provisions of section 28,
shall, in addition to such duty, be liable to pay interest, if any, at the rate
fixed under sub-section (2), whether such payment is made voluntarily
or after determination of the duty under that section.

Interest at such rate not below ten per cent and not exceeding thirty-six
per cent per annum, as the Central Government may, by notification in
the Official Gazette, fix, shall be paid by the person liable to pay duty in
terms of section 28 and such interest shall be calculated from the first
day of the month succeeding the month in which the duty ought to have
been paid or from the date of such erroneous refund, as the case may
be, up to the date of payment of such duty.
 Chapter X - Drawback

• SECTION 74. Drawback allowable on re-export of duty-

paid goods. - (1) When any goods capable of being easily
identified which have been imported into India and upon
which any duty has been paid on importation, -
(i) are entered for export and the proper officer makes an
order permitting clearance and loading of the goods for
exportation under section 51; or
(ii) are to be exported as baggage and the owner of such
baggage, for the purpose of clearing it, makes a declaration
of its contents to the proper officer under section 77 (which
declaration shall be deemed to be an entry for export for
the purposes of this section) and such officer makes an
order permitting clearance of the goods for exportation; or
Contd……
• (iii) are entered for export by post under clause (a) of section
84 and the proper officer makes an order permitting
clearance of the goods for exportation,
ninety-eight per cent of such duty shall, except as otherwise
hereinafter provided, be re-paid as drawback, if
(a) the goods are identified to the satisfaction of the AC of
Customs or DC of Customs as the goods which were imported;
and
(b) the goods are entered for export within twoyears from the
date of payment of duty on the importation thereof :
Provided that in any particular case the aforesaid period of
two years may, on sufficient cause being shown, be extended
by the Board by such further period as it may deem fit.
 Sn75. Drawback on imported materials used in
the manufacture of goods which are exported
• (1) Where it appears to the Central Government that in respect of
goods of any class or description manufactured, processed or on
which any operation has been carried out in India being goods
which have been entered for export and in respect of which an
order permitting the clearance and loading thereof for exportation
has been made under section 51 by the proper officer or being
goods entered for export by post under clause (a) of section 84
and in respect of which an order permitting clearance for
exportation has been made by the proper officer, a drawback
should be allowed of duties of customs chargeable under this Act
on any imported materials of a class or description used in the
manufacture or processing of such goods or carrying out any
operation on such goods
• Provided that no drawback shall be allowed under
this sub-section in respect of any of the aforesaid
goods which the Central Government may, by rules
made under sub-section (2), specify, if the export
value of such goods or class of goods is less than the
value of the imported materials used in the
manufacture or processing of such goods or carrying
out any operation on such goods or class of goods
or is not more than such percentage of the value of
the imported materials used in the manufacture or
processing of such goods or carrying out any
operation on such goods or class of goods
• SECTION 75A. Interest on drawback. - (1) Where
any drawback payable to a claimant under section
74 or section 75 is not paid within a period of one
month from the date of filing a claim for payment
of such drawback, there shall be paid to that
claimant in addition to the amount of drawback,
interest at the rate fixed under section 27A from
the date after the expiry of the said period of one
month till the date of payment of such drawback:
• Where any drawback has been paid to the claimant
erroneously or it becomes otherwise recoverable
under this Act or the rules made thereunder, the
claimant shall, within a period of two months from the
date of demand, pay in addition to the said amount of
drawback, interest at the rate fixed under section 28AA
and the amount of interest shall be calculated for the
period beginning from the date of payment of such
drawback to the claimant till the date of recovery of
such drawback.
 IGST
• the integrated tax on goods imported into
India shall be levied and collected in
accordance with the provisions of section 3 of
the Customs Tariff Act, 1975 on the value as
determined under the said Act at the point
when duties of customs are levied on the said
goods under section 12 of the Customs Act,
1962.
• The integrated tax on the supply of petroleum
crude, high speed diesel, motor spirit
(commonly known as petrol), natural gas and
aviation turbine fuel shall be levied with effect
from such date as may be notified by the
Government on the recommendations of the
Council
• Supply of goods imported into the territory of
India, till they cross the customs frontiers of
India, shall be treated to be a supply of goods
in the course of inter-State trade or commerce
• Supply of services imported into the territory
of India shall be treated to be a supply of
services in the course of inter-State trade or
commerce.
• Supply of goods or services or both,––
• (a) when the supplier is located in India and the
place of supply is outside India;
• (b) to or by a Special Economic Zone developer or a
Special Economic Zone unit; or
• (c) in the taxable territory, not being an intra-State
supply and not covered elsewhere in this section,
shall be treated to be a supply of goods or services
or both in the course of inter-State trade or
commerce.
• 8. (1) Subject to the provisions of section 10, supply
of goods where the location of
• the supplier and the place of supply of goods are in
the same State or same Union territory shall be
treated as intra-State supply:
• Provided that the following supply of goods shall not
be treated as intra-State supply, namely:––
• (i) supply of goods to or by a Special Economic Zone
developer or a Special Economic Zone unit;
• (ii) goods imported into the territory of India till they
cross the customs frontiers of India; or
• (iii) supplies made to a tourist referred to in section 15.
 Compensation Cess
• Goods and Services Tax (Compensation to States)
Act, 2017 was enacted to levy Compensation cess
for providing compensation to the States for the
loss of revenue arising on account of
implementation of the goods and services tax with
effect from the date from which the provisions of
the Central Goods and Services Tax Act is brought
into force (01/07/2017), for a period of five years
or for such period as may be prescribed on the
recommendations of the GST Council.
• The compensation cess on goods imported
into India shall be levied and collected in
accordance with the provisions of section 3 of
the Customs Tariff Act, 1975, at the point
when duties of customs are levied on the said
goods under section 12 of the Customs Act,
1962, on a value determined under the
Customs Tariff Act, 1975.
• Compensation Cess will not be charged on
goods exported by an exporter under bond
and the exporter will be eligible for refund of
input tax credit of Compensation Cess relating
to goods exported. In case goods have been
exported on the payment of Compensation
Cess the exporter will be eligible for refund of
Compensation Cess paid on goods exported by
him. Compensation cess shall not be leviable
on supplies made by a taxable person who has
decided to opt for composition levy.
• The compensation cess is a cess that will be
collected on the supply of select goods and or
services or both till 1st July 2022. The cess will
compensate the states for any revenue loss on
account of implementation of GST. This cess will
not be payable by exporters and those persons
who have opted for compensation levy. The input
tax credit of this cess can be only used to pay
compensation cess and not the other taxes like
CGST, SGCT or IGST.
 Chapter 98- Project Imports
• Project imports; laboratory chemicals;
passengers' baggage,personal importations
by air or post; ship stores comes under
chapter 98.
• This Chapter is to be taken to apply to all
goods which satisfy the conditions prescribed
therein, even though they may be covered by
a more specific heading elsewhere in this
Schedule.
• Project Imports Regulations, 1986 [Notfn. No.
230/86-Cus. dt. 3.4.1986 as amended by
Notfn. Nos. 17/92, 142/92, 153/95, 54/97,
92/02, 37/03, 16/04, 17/06, 30/07, 15/10,
18/12, 25/14, 20/16, 24/17]
• ELIGIBILITY:- The assessment under the said
heading No. 98.01 shall be available only to
those goods which are imported (whether in
one or more than one consignment) against
one or more specific contracts, which have
been registered with the appropriate Custom
House in the manner specified in regulation 5
and such contract or contracts has or have
been so registered Contd…….
• (i) before any order is made by the proper officer of
customs permitting the clearance of the goods for
home consumption;
• (ii) in the case of goods cleared for home
consumption without payment of duty subject to re-
export in respect of fairs, exhibitions, demonstrations,
seminars, congresses and conferences, duly
sponsored or approved by the Government of India or
Trade Fair Authority of India, as the case may be,
before the date of payment of duty.
• REGISTRATION OF CONTRACTS:- (1) Every importer
claiming assessment of the goods falling under the
said heading No. 98.01, on or before their importation
shall apply in writing to the proper officer at the port
where the goods are to be imported or where the
duty is to be paid for registration of the contract or
contracts, as the case may be:
• Provided that in the case of consignments sought to
be cleared through a Custom House other than the
Customs House at which the contract is registered, the
importer shall produce from the Custom House of
registration such information as the proper officer
may require.
• The application shall specify:-
• (a) the location of the plant or project:
• (b) the description of the articles to be
manfuactured, produced, mined or explored;
• (c) the installed or designed capacity of the plant
or project and in the case of substantial
expansion of an existing plant or project the
installed capacity and the proposed addition
thereto;
• (d) such other particulars as may be considered
necessary by the proper officer for purposes of
assessment under the said heading.
• (4) The application shall be accompanied by the
original deed of contract together with a true copy
thereof, the import trade control licence, wherever
required and an approved list of items from the
Directorate General of Technical Development or
the concerned sponsoring authority,
• (5) The importer shall also furnish such other
documents or other particulars as may be required
by the proper officer in connection with the
registration of contract.
• (6) The proper officer shall, on being satisfied
that the application is in order register the
contract by entering the particulars thereof in
a book kept for the purpose, assign a number
in token of the registration and communicate
that number to the importer and shall also
return to the importer all the original
documents which are no longer required by
him.
• AMENDMENT OF CONTRACT:- (1) If any
contract referred to in regulation 5 is
amended, whether before or after
registration, the importer shall make an
application for registration of the
amendments to the said contract to the
proper officer.
• Main objectives of classification
– To facilitate international trade
– Collection, comparison and analysis of trade
statistics
– Standardization of trade documentation and
transmission of data
 What is the Harmonized Commodity
Description and Coding System?
• The Harmonized Commodity Description and Coding
System or simply Harmonized System of
Nomenclature (HSN) is an internationally
standardized system of names (description) and
numbers (codes) for classifying traded goods.
• The HSN is a product nomenclature where each
product is assigned its corresponding “6-digit” code.
• The first four digits are referred to as the heading.
• While the code up to the sixth digit is known as a
subheading.
• Countries that have adopted the Harmonized
System are not permitted to alter in any way
the descriptions associated to a heading or a
subheading nor can the numerical codes at
the four or six digit levels be altered.
• This is what keeps the Harmonized System
harmonized.
• It was developed by World Customs Orgn and
it came into effect from 1988.
• The HS is primarily divided into 21 Sections
• - Sections are divided into Chapters
• - There are 99 Chapters under the HS - However, Chapter 77 is
reserved for future use, while Chapters 98 & 99 are reserved
for special uses by contracting parties to the HS Convention
• Headings
• - Chapters are divided into headings - Headings are assigned
with four-digit codes
• Subheadings
• - Headings are further divided into subheadings - HS
subheadings are assigned with six-digit codes