CBIC and DGFT Implements SC direction relates to mandatory fulfillment of 'Pre-Import Condition'
Import – CBIC and DGFT Implements – SC direction relates to mandatory – TAXSCAN
Import – CBIC and DGFT Implements – SC direction relates to mandatory – TAXSCAN
The Central Board of Indirect Taxes and Customs (CBIC) and Directorate General of Foreign Trade (DGFT) implemented the Supreme Court Direction in the Judgment of the case UOI and others vs. Cosmos Films Ltd. dated 28th April 2023 related to the mandatory fulfilment of the ‘Pre-import condition’.
The apex court has allowed the appeal of Revenue directed against a judgement and order of the Gujarat High Court which had set aside the said mandatory fulfillment of pre-import condition. As such, this implies that the relevant imports that do not meet the said pre-import condition requirements are to pay IGST and Compensation Cess to that extent.
The Supreme Court has still ordered the Revenue to enable claims for refunds or input credits (where appropriate and/or wherever customs duty was paid) allowing the Revenue's appeal.
Within six weeks of the judgement date, the respondents need to contact the jurisdictional commissioner and submit an application with supporting documentation. The merits of each claim for a refund or credit will be considered individually. The revenue shall issue a circular directing the right procedure to be followed, conveniently, in this regard.
After considering the judgment of the Supreme Court, the board issued following procedures to be adopted in the port of the import;
- The importer (including the respondents) may approach the concerned assessment group at the POI with relevant information for purposes of payment of the tax and cess as well as any applicable interest for the relevant imports that could not satisfy the said pre-import condition and are therefore required to pay IGST and Compensation Cess to that extent.
- The POI assessment group will cancel the OOC and provide a brief explanation in the records. According to the aforementioned ruling, the Bill of Entry must be reassessed in order to levy the tax and cess.
- The payment of tax and cess, along with applicable interest, shall be made against the electronic challan generated in the Customs EDI System.
- The port must create a notional OOC for the BE on the Custom EDI System after the aforementioned payment is complete [in order to enable transmission to the GSTN portal of, among other things, the IGST and Compensation Cess amounts with their date of payment (relevant date) for qualifying under the GST provisions)].
- The procedure specified at (a) to (d) above can be applied once to a Bill of Entry.
Therefore, the assessed BE shall be permitted to be available subject to the eligibility and conditions for taking an input tax credit under Sections 16, Sections 17, and Sections 18 of the Central Goods and Services Tax Act, 2017, and rules made thereunder.
The DGFT also issued the notice on June 8th 2023 regarding this circular issued by the CBIC with regards to the Supreme Court Judgment.
To Read the full text of the Order CLICK HERE
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