Definition & Basic Concept of Custom Duty - Customs Act,1962, Indirect Tax Laws | Indirect Tax Laws - B Com PDF Download

Basic customs duty levied u/s 12 of Customs Act is generally 10% of non-agricultural goods, w.e.f. 1-3-2007.

• CVD equal to excise duty is payable on imported goods u/s 3(1) of Customs Tariff Act to counterbalance impact of excise duty on indigenous manufactures, to ensure level paying field.
• CVD is payable equal to excise duty payable on like articles if produced in India. It is payable at effective rate of excise duty.
• General excise duty rate is 10.30% w.e.f. 27-2-2010 (10% basic plus 2% education cess and SAH Education cess of 1%).
• CVD is payable on assessable value plus basic customs duty. In case of products covered under MRP provisions, CV duty is payable on MRP basis as per section 4A of Central Excise.
• CVD can be levied only if there is ‘manufacture’.
• CVD is neither excise duty nor basic customs duty. However, all provisions of Customs Act apply to CVD.

• Antidumping duty is leviable u/s 9A of Customs Tariff Act when foreign exporter exports his good at low prices  compared to prices normally prevalent in the exporting country.
• Dumping is unfair trade practice and the anti-dumping duty is levied to protect Indian manufacturers from unfair competition.
• Margin of dumping is the difference between normal value (i.e. his sale price in his country) and export price( price at which he is exporting the goods).
• Price of similar products in India is not relevant to determine ‘margin of dumping’.
• ‘Injury margin’ means difference between fair selling price of domestic industry and landed cost of imported products. Dumping duty will be lower of dumping margin or injury margin.
• Benefits accruing to local industry due to availability of cheap foreign inputs is not considered. This is a drawback.
• CVD is not payable on antidumping duty. Education cess and SAH education cess is not payable on anti-dumping duty.
• In case of imports from WTO countries, antidumping duty can be imposed only if it cause material injury to domestic industry in India.
• Dumping duty is decided by Designated Authority after enquiry and imposed by Central Government by notification. Provisional antidumping duty can be imposed. Appeal against antidumping duty can be made to CESTAT.