Any goods imported / Exported to go through the customs Channel to get clearance & proper assessment of Customs Duty as per prevailing rules. This is a major source of Income for the government and it prevents Smuggling , Dumping of goods, illegal drugs & Narcotics etc. Hence they play a vital role in our Nation Building.
All goods imported will be in the custody of port trust & Authority of Customs Department. The importer to pay customs duty after the appraisal by the department. Also they need to clear the port trust dues including Demurrage charges to get the materials cleared.
Customs Duty depends on the Tariff Code as mentioned in the ITC ( Indian Trade Classification) / HSN ( Harmonic System of Nomenclature ) Number of that commodity. For Eg., 7304 1110 is the Tariff Code for Stainless Steel Tubes & Pipes having specific diameter. Components of Customs Duty are Basic Duty, Preferential Duty, IGST, Central Excise Educational Cess, Customs Educational Cess, Special Duty Etc.
Customs Duty is calculated on Assessable Value of the Item which is CIF Value + 1% Landing Charges. Customs Duty is Charged on Ad-Valorem basis ( a percentage of value of goods imported), or Fixed Charges or a Combination of both.
For related party transactions , you need to execute a Provisional Duty ( PD) assessment bond along with cash security / bank Security deposit prior to customs clearance. The bond states that the parties relationship has not affected the pricing & they will pay the difference in duty amount between final assessment & provisional assessment.
Anti Dumping duty is levied on distrustfully low priced imports, so as to protect the domestic manufacturers. This decision is based on the recommendations of the Director General of Trade Remedies (DGTR), an investigative arm of Commerce ministry. The directorate General of Anti Dumping initiates the action against violators.
