There is no provision to take credit of the agriculture infra cess: Expert

In this Budget, the government has imposed an Agriculture Infrastructure Development Cess (AIDC) on some imported and excisable goods. Can we take Credit of the same and set off against GST or excise duty payable on the final product?

No. There is no provision to take Credit of the AIDC. This should not matter much because wherever AIDC has been imposed, the basic customs duty (BCD) or excise duty has been reduced, and in any case, the Credit of BCD on imported goods or excise duty on petroleum products is not available. So, the imposition of AIDC, at least for the present, mainly affects the issue of sharing revenue with the states. 

We are manufacturers based in Jalgaon in Maharashtra. We have an agent in Delhi, who has procured an order to supply our goods to a party in Aurangabad. Can we supply on payment of CGST and SGST, as we (the supplier) and the recipient of the goods are in the same state?

As per Section 10(1)(b) of the IGST Act, 2017, “where the goods are delivered by the supplier to a recipient or any other person on the direction of a third person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to the goods or otherwise, it shall be deemed that the said third person has received the goods and the place of supply of such goods shall be the principal place of business of such person”.

In this case, you are delivering the goods to the Aurangabad party on the instructions of the Delhi agent. So, the place of supply is Delhi and so you must prepare a “bill to – ship to” invoice on the Delhi agent (showing the Aurangabad party as the consignee) and charge IGST. 

In the case of one of our imports, the seller, by mistake, sent an invoice for a lower value of $2,000 instead of $20,000. We did not notice this and filed the bill of entry as per the invoice received and cleared the goods under self-assessment. Now, our bankers refuse to remit more than $2,000. How to overcome this problem?

In this case, the Customs have also received less duty. So, you may ask the supplier to send a fresh invoice along with a letter explaining the mistake. Based on that you may approach the Customs to re-assess the bill of entry and pay the differential duty along with interest. Then, you may approach your banker to remit the amount as per the reassessed bill of entry.

In the Finance Bill 2021, there is a proposal to introduce anti-absorption provision in the anti-subsidy countervailing duty provisions. What does anti-absorption mean?
 

It refers to a decrease in the export price of an article imported from the exporting country or territory without any commensurate change in the resale price in India of such an article, or as may be provided by Rules.

Email: tncrajagopalan@gmail.com