CBIC notifies Customs (Assistance in Value Declaration of Identified Imported Goods) Rules, 2023

This Tax Alert summarizes a recent notification issued by the Central Board of Indirect Taxes and Customs (CBIC) notifying Customs (Assistance in Value Declaration of Identified Imported Goods) Rules, 2023 (the Rules).

The Rules provide as follows:

• CBIC may issue order specifying complete description of the identified goods with 8-digit HSN (harmonized system of nomenclature) Code, the particular unique quantity code, technical or other specifications necessary to be declared in the bill of entry and the checks to be exercised. The said order shall be valid for a period not less than one year and not exceeding two years.
  
  
• An importer of identified goods shall be required to declare the value of goods using the unique quantity code specified in the order.
  
  
• Where required by the Customs Automated System, the importer shall also fulfill the specified obligations. In case such obligations are not fulfilled, the proper officer shall provide an additional time period of ten days.
  
  
• The officer may also ask for further information and documents from the importer to examine truthfulness and accuracy of the declared value. He may provisionally assess and clear goods subject to importer furnishing appropriate security.
  
  
• Where the requisite information is not provided or the proper officer still has a reasonable doubt about the value declared basis the details furnished by the importer, the further proceedings shall be in accordance with rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.
  

The rules will be operationalized from 11 February 2023.

Comments:

• The objective of the Rules seems to prevent undervaluation of the notified class of goods. Presently, the same is being done by the authorities as post import activity.
  
  
• In order to avoid any subjectivity, appropriate guidelines may be issued for officers seeking additional information from importers under the Rules.
  
  
• Businesses may need to analyze whether the exception with respect to imports not involving duty would cover the imports made by EOUs and SEZs. 
  
  
• At present, the Rules seem to be silent on the procedure to be followed if the license or authorization conditions are not met.
  
  
• It is relevant to note that in the draft rules, imports made by warehouses licensed under section 65 of Customs Act were also excluded from the applicability of these rules.