Hot Off The PressNews

Central Board of Indirect Taxes and Customs has launched a revamped and streamlined programme to attract investments into India and strengthen Make in India through manufacture and other operations under the bond scheme, under Customs Act, 1962.

Section 65 of the Customs Act, 1962 enables the conduct of manufacture and other operations in a customs bonded warehouse.

            The scheme has been modernized with clear and transparent procedures, simplified compliance requirements ICT-based documentation and account keeping, by the issue of Manufacture and Other Operations in Warehouse (No. 2) Regulations, 2019 and Circular 34/2019 both dated 01 October 2019.

The main features of the scheme are as below –

  1. A single application cum approval form prescribed for uniformity of practice. The jurisdictional Commissioner of Customs will function as a single point of approval to set up and oversee the operations of such units.
  2. No geographical limitation on where such units can be set up.
  3. The unit can import goods (both inputs and capital goods) under a customs duty deferment program. The duties are fully remitted if the processed goods are exported.
  4. There will be no interest liability and units will benefit through improved liquidity.
  5. GST compliant goods can be procured from the domestic market for use in the manufacture and other operations in a section 65 unit.
  6. A single digital account has been prescribed for ease of doing business and easy compliance.
  7.  The scheme would also enable efficient capacity utilization, as there is no limit on the quantum of clearances that can be exported or cleared to the domestic market.

CBIC has collaborated with Invest India to launch a dedicated microsite for providing information and promoting the scheme and for the facilitation of investors. The site can be accessed at https://www.investindia.gov.in/bonded-manufacturing

            The scheme is expected to play a critical role in promoting investments in India and in enhancing ease of doing business. It can enable the ‘Make in India’ programme, encourage exports, create hubs for electronics assembly, repair & refurbishment operations, inward and outward processing, facilitate global e-commerce hubs, etc.


[Press Release dt. 15-10-2019]

Ministry of Finance

Case BriefsHigh Courts

Kerala High Court: The Bench of Dama Seshadri Naidu J. hearing a civil writ petition filed by a vehicle dealer granted an interim stay on the levy of Goods and Services Tax on the amount collected by vehicle dealers from purchasers.

Petitioner, a motor vehicle dealer, challenged the applicability of Section 15(2) of the GST Act, 2017 which mandates that the value of supply should include any taxes, duties, cesses, fees and charges levied under any other law in force. His contention was that the amount of 1% that the dealer of motor vehicle collects from the purchaser of a car worth more than ten lakhs (which is the tax collected at source), under Section 206C (1F) of the Income Tax Act, 1961 cannot be treated as an integral part of the value of the goods and services supplied by the petitioner. This is so because the dealer of the motor vehicle, acts only as an agent for the State to collect income tax under Section 206C(1F) of the IT Act and that amount eventually goes to the vehicle purchaser’s credit.

The Court concluded that the petitioner had raised a prima facie issue which needed Court’s attention and further and deeper adjudication. In view thereof, it directed the tax authorities to not act on the clarification at serial no. 5 of the notification issued by the Central Board of Indirect Taxes and Customs till the disposal of the instant petition.[PSN Automobiles (P) Ltd. v. Union of India, WP (C) No. 680 of 2019, order dated 17-01-2019]

Appointments & TransfersNews

Shri S. Ramesh, IRS (C&CE:1981) has taken over as Chairman, Central Board of Indirect Taxes and Customs [CBIC], on superannuation of Smt. Vanaja N. Sarna today . Prior to his elevation, he was Member (Administration) in the Board.  Shri S. Ramesh began his career in Mumbai as Asst Commissioner, Central Excise and thereafter in Mumbai Customs. He has worked in various capacities in Hyderabad, Nagpur, Chennai, Trichy etc. He was the Chief Commissioner, Chennai Customs Zone from 2013 to 2016. Thereafter, he took over as Director General, Systems & Data Management. He joined the Board in September, 2016 as Member (IT, Central Excise & Service Tax).

Ministry of Finance