'Customs not justified in asking for CVD plus 4% special duty'

'Site' means any premises made available for manufacture of goods by way of a specific mention in contract

We refer to the notification 12/2016-CE dated March 1, 2016 that amends S. No. 144 of the notification no. 12/2012-CE dated March 17, 2012 so as to fully exempt excise duty on ready mix concrete (RMC) manufactured at construction sites for use in construction at such sites. Can we remove part of the RMC manufactured at one site to another site on duty payment?

The explanation to that S. No. 144 says, "for the purpose of this entry, the expression ‘site’ means any premises made available for the manufacture of goods by way of a specific mention in the contract or agreement for such construction work, provided that the goods manufactured at such premises are solely used in the said construction work only." 

So, it appears that unless the entire production of RMC manufactured at site is used solely at the site, the exemption will be denied even for RMC used at the site. So it is better to avoid removal of any RMC manufactured at one site to another site, even on duty payment. It is better to seek clarification on this matter. 

On re-import of exported goods, we have claimed exemption under notification 94/96-Cus dated December 16, 1996. Since we had not claimed any export benefits except clearance of goods without excise duty payment under UT-1, we have sought clearance of the goods on payment of excise duty not paid as per S. No. 1 (d) of the Table annexed to that notification. Are the customs justified in asking us to pay CVD at the current excise duty rate and also ask for four per cent special additional duty on that?

The notification exempts so much of the duty of customs leviable thereon which is specified in the said First Schedule, the additional duty leviable thereon under section 3 of the said Customs Tariff Act and special duty of customs leviable under sub-section (1) of section 68 of the Finance (No. 2) Act, 1996 (33 of 1996), as is in excess of the amount indicated in the corresponding entry in column (3) of the said Table.

Since the said Column (3) of S. No. 1(d) in the Table mentions only ‘amount of Central Excise duty not paid’, you need not pay anything more. I see no justification for customs to demand CVD at the current excise duty rate or ask for four per cent special additional duty on that.

We have obtained an EPCG authorisation for import of our capital goods but we want to procure the item from a domestic manufacturer. We have got an invalidation letter issued in his favour so that he can obtain an advance authorisation to import his inputs duty free. Can we now get the capital goods from him without excise duty payment?

No. There is no exemption notification to enable supply of capital goods to EPCG authorisation holders without payment of excise duty. However, refund of excise duty paid on the capital goods can be claimed under deemed export provisions either by the supplier or recipient of the capital goods.