'Duty credit scrips can be used to pay customs duties in cases of default'

We have ordered some goods from France that will first go to China for some processing and then arrive in India. How will the Customs value the goods?
Customs will go by the transaction value if the invoice from France represents the full price paid or payable for the goods as presented to the Customs for assessment and you don't make any other remittances in connection with the sale of the goods. However, if you pay the Chinese party separately or bear any other costs in connection with the sale of the goods that are not included in the invoice from France, the Customs will load such amounts, in accordance with Rule 10(1)(e) of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.

For regularisation of default in our Export Promotion Capital Goods (EPCG) authorisation, can we purchase duty credit scrips issued under Status Holder Incentive Scheme (SHIS) from the market and pay the duty through that scrip?
As per Para 3.16.3 of the Foreign Trade Policy (FTP), SHIS scrips can be transferred only to a manufacturer group company or status holder manufacturer. Secondly, SHIS can be used for import of capital goods (CG) relating to the sectors specified in Para 3.16.4 of the FTP and Para 3.10.8 of the Handbook of Procedures, Vol. 1 (HB-1). Only in respect of CG imported earlier, up to 10 per cent of the value of the duty credit scrip can be used for import of components / spares / parts of such CG.

Para 3.17.11 of FTP allows utilisation of duty credit scrips for payment of customs duties towards regularisation of defaults for authorisations issued under Chapter 4 and 5 of the FTP. As per Para 7 (b) of Chapter 23 of Customs Manual 2014, these scrips being usable only with respect to those goods that are permitted to be imported under the relevant reward scheme pertaining to that scrip, debit of duty in a scrip, even in the case of discharging duty on already imported goods in cases of export obligation (EO) default, should be only in respect of goods that are importable under that scrip.

If a scrip can be used in relation to a capital goods 'CG1' but not 'CG2', then it cannot be used to debit duty related to import of 'CG2' in relation to which an export obligation default is there. So, if you are eligible to get the SHIS transferred in your favour and the goods imported under EPCG are eligible for import under SHIS scheme also, then you can seek payment of customs duties towards EO default through debit to SHIS transferred in your favour.

The Finance Act, 2014 prescribes a mandatory pre-deposit for appeals in Customs / Excise matters. Can we make such a pre-deposit for appeals after 6.8.2014 by debit to Cenvat Credit balances?
As per Tribunal Circular F.No.15/CESTAT/General/2013-14 dated June 28, 2014, in the absence of clarifications from the competent authority, appeals can be registered if the mandatory pre-deposit is made from Cenvat account and evidence thereof is produced.

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