Countervailing Duty Definition

Countervailing Duty is levied on the cost of imported goods and is equal to excise duty levied on like goods when manufactured in India.

The objective is to ensure that the protection provided by the import duty to domestic industry is not eroded.

Customs Surcharge

It is levied at the rate of 10% of the basic rate on all commodities except crude oil and petroleum products, GATT-bound items, gold and silver.

Basic Custom Duty

All goods imported into India are chargeable to duty as prescribed in the 1st Schedule of Customs Tariff Act. This Schedule is amended from time to time of Customs Tariff Act.

This duty can be levied either as a percentage of value of goods or at a specified rate.

Customs Duties are Levied in three Ways

Specific rate-at the rate prescribed per unit of item i.e. weight or number of length

Ad-valorem duty-levied on the value of the item Specific and

Advalorem-levied in both ways.

Customs Tariff Classification

The basic legislation is the Indian Customs Act, 1962 read with Customs Tariff Act, 1975. Section 12 of the Customs Act,'62 empowers levy of duties on goods imported into or exported from India.

However, the rates at which the different import export duties shall be leviable have been respectively specified in the First and Second Schedule to the Customs Tariff Act, 1975-called the import Tariff and Export Tariff respectively.

With effect from Feb. 28, 1986, the new tariff import schedule based on international convention of Harmonised Commodity and Coding system, commonly known as Harmonised Coding System came into being.

The basic features of the Import Tariff Nomenclature are outlined below: The headings, the Section and Chapter Notes and the interpretive Rules