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Publish Date: 04 Mar, 2011
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Introduction of Self-assessment of Goods under Customs

Introduction of Self-assessment of Goods under Customs

Prepared By:
CA Pradeep Jain and
Sukhvinder Kaur, LLB[FYIC]

The Finance Minister has in Budget 2011-12 proposed to introduce self-assessment in Customs. In it speech the Finance Minister had said that this is done to quicken the clearance of the cargo by Customs authorities and to further modernize the Customs administration.
 
It was further stated that under this, importer and exporters will themselves assess their duty liabilities while fighting declarations in the EDI system. The Department will verify such assessments on a selective system driven basis.
 
Till now, self assessment was allowed under Excise and Service Tax fields. Now, the self-assessment is proposed to be introduced in Customs as well.
 
To introduce self-assessment, the Finance Minister has in the Finance Bill proposed to introduce changes in the provisions of the Customs Act, 1962. These statutory changes are as under:
 
The definition of “assessment” in Section 2 (2) of the Act is proposed to be changed to includ self-assessment as under:
 
(2) "assessment" includes provisional assessment, self-assessment,  re-assessment and any assessment in which the duty assessed is nil;
 
Section 17 of the Customs Act is proposed to be amended to provide for self-assessment as under:
 
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 self-assessment of such goods and for this purpose, examine or test any imported goods or export goods or such part thereof as may be necessary.  
 
(3) For verification of self-assessment under sub-section (2), the proper officer may require the importer, exporter or any other person to produce any contract, broker's note,  insurance policy, catalogue or other document, whereby the duty leviable on the imported goods or export goods, as the case may be, can be ascertained, and to furnish any information required for such ascertainment which is in his power to produce or furnish, and thereupon the importer, exporter or such other person shall produce such document and furnish such information.
 
(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 regarding valuation of goods, classification, exemption or concessions of duty availed consequent to any notification issued therefor under this Act, and in cases other than those where the importer or the exporter, as the case may be, confirms his acceptance of the 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.
 
(6) Where re-assessment has not been done or a speaking order has not been passed on re-assessment, the proper officer may audit the assessment of duty of the imported goods or export goods at his office or at the premises of the importer or exporter, as may be expedient, in such manner as may be prescribed.
 
Explanation – For the removal of doubts, it is hereby declared that in cases where an importer has entered any imported goods under section 46 or an exporter has entered any export goods under section 50 before the date on which the Finance Bill, 2011 receives the assent of the President, such imported goods or export goods shall continue to be governed by the provisions of section 17 as it stood immediately before the date on which such assent is received.”
 
Section 18 of the Customs Act which provides for Provisional assessment of duty is consequently proposed to be amended as under:
 
Sub-section (1) is proposed to be substituted as under:
 
(1) Notwithstanding anything contained in this Act but without prejudice to the provisions contained in section 46 -
 
(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 the exporter has produced all the necessary documents and furnished full information for the assessment of duty 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;
 
the proper officer may direct that the duty leviable on such goods be assessed provisionally if the importer or the exporter, as the case may be, furnishes such security as the proper officer deems fit for the payment of the deficiency, if any, between the duty as may be finally assessed and the duty provisionally assessed.
 
The introduction of self-assessment in Customs will considerably reduce the involvement of the Customs officers in clearance of day-today goods. 

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Comments

  • S.L.Bansal on 04 August, 2011 wrote:

    Let us hope the self assessment scheme is pomoted in propoer spirit by Customs officer as in Jodhpur there is a tendency to delay the matter.

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