No Bar On Second-Hand Capital Goods Import Under Project Import Regulations

2-Sep-2013

Can we import second-hand equipment under Project Import Regulations and, if so, what are the extra formalities? Can we use the Status Holder Incentive Scrip (SHIS) to pay duty on goods assessed under project imports at 98.01? What is the amount of bank guarantee to be furnished to the Customs and what are the guidelines for renewal of guarantee?

There is no bar on import of second-hand capital goods under the Project Import Regulations. For the purpose of valuation of second-hand capital goods, you have to follow the instructions, such as submission of Chartered Engineer Certificate, prescribed in CBEC Circular no. 4/2009-Cus dated 12.02.2008. You can use SHIS to pay duty even when assessment is done under the classification 98.01, provided other conditions are met. As per CBEC Circular no. 12/2011-Cus dated 1.3.2011, subject to a maximum of Rs 1 Crore, only a bank guarantee, equivalent to two per cent of the CIF value of goods sought to be imported, would be taken at the time of registration of the Project Contract under Project Import Regulations, 1986. The said bank guarantee shall be backed by an undertaking that it would be renewed from time to time. However, the said bank guarantee need not be renewed on completion of a period of six months from the date of submission of necessary documents, from the specified authority, as proof of utilisation/installation of goods for the finalisation of the contract.



While filing of Served from India Scheme (SFIS) application, can we submit the request of Group Company endorsement simultaneously, to avoid delay?

Yes. You can do so.



We send our partially processed inputs to a job-worker under Rule 4(5)(a) of Cenvat Credit Rules, 2004. We want to clear the scrap generated at the job-worker's factory on duty payment. We want to know the procedures and the value on which we have to pay duty on the scrap.

You may obtain the permission of your Assistant/Deputy Commissioner of Central Excise to clear the scrap on duty payment from the job-worker's factory, in accordance with Rule 4(6) of Cenvat Credit Rules, 2004. He may grant annual permission and specify any conditions, including manner of duty payment. After you send that permission to the job-worker, let the job-worker mention on the body of the original and duplicate of the challan under which he received your partially processed inputs and the reference number and date of the permission letter.



Thereafter, you may pay duty as specified in the permission and issue your excise invoice, mentioning the reference number and date of the permission letter and the name and address of the factory of the job-worker as the place of despatch. The duplicate of the invoice must accompany the goods from the job-worker's premises to the consignee. The value must be determined in accordance with Section 4 of the Central Excise Act, 1944 read with the Central Excise Valuation Rules, 2000. Please note that the duty liability must be discharged by you and not the job-worker.

Source:- business-standard.com