Key highlights of the proposed Customs & Excise changes in Union Budget 2023-24

Notification /Circular Nos.

Date

Customs (Tariff)

02/2022-Customs to 12/2022-Customs

 February 1, 2023

Central Excise (Tariff)

05/2023-Central Excise

February 1, 2023

Commodity

BCD

AIDC

SWS

Total duty

From

To

From

To

From

To

Gold Bars

12.50%

10 %

2.50%

5.00%

Nil

Nil

15%

Gold Dore

11.85%

10 %

2.50%

4.35%

Nil

Nil

14.35%

Platinum

12.50%

10%

1.50%

5.40%

1.40

Nil

15.40%

Silver Bar

7.50%

10%

2.50%

5.00%

0.75

Nil

15%

Silver Dore

6.10%

10%

2.50%

4.35%

0.61

Nil

14.35%

Description of goods

From

To

Fish meal

15%

5%

Krill meal

15%

5%

Fish lipid oil

30%

15%

Algal Prime (flour)

30%

15%

Mineral and Vitamin Premixes

15%

5%

1.

Silver (HSN 7106), Gold ( HSN 7108) & Imitation Jewellery (HSN 7117)

2.

Platinum (HSN 7110) other than rhodium and goods covered under S. Nos. 415(a) and 415A of the Table annexed to the notification No. 50/2017-Customs, dated the June 30, 2017, published in the Gazette of India vide number G.S.R. 785(E), dated the June 30, 2017.

3

All goods falling under HSN 7113, other than the goods covered under S. Nos. 356, 357 and 364C of the Table in the notification No. 50/2017-Customs, dated June 30, 2017, published in the Gazette of India vide number G.S.R. 785(E), dated the June 30, 2017.

4.

All goods falling under HSN 7114, other than the goods covered under S. Nos. 356 and 357 of the Table in the notification No. 50/2017-Customs, dated the June 30, 2017, published in the Gazette of India vide number G.S.R. 785(E), dated the June 30, 2017.

5

Bicycles (HSN 8712 00 10)

6

Motor vehicle including electrically operated vehicles falling under HSN 8703 covered under S. No. 526 (1)(b), 526 (2)(b), 526A(1)(b) and 526A(2)(b) of the Table in Notification No. 50/2017-Customs dated the June 30, 2017, published in the Gazette of India vide no G.S.R. 785(E) dated the June 30, 2017.

7

Aeroplane and other aircrafts falling under tariff items 8802 2000, 8802 3000 and 8802 4000 covered under S. No. 543 A of the Table in Notification No. 50/2017-Customs dated the June 30, 2017, published in the Gazette of India vide no G.S.R. 785(E) dated the June 30, 2017.

8

Toys and parts of toys (HSN 9503) other than goods covered under S. No. 591of the Table annexed to Notification No. 50/2017-Customs dated June 30,2017

1

No. 13/2021-Customs, dated the February 1, 2021, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R.71(E), dated the February 1, 2021

2

No. 34/2022-Customs, dated the June 30, 2022, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 487(E), dated the June 30, 2022

S.No

Commodity

From

To

1.

Silver bar

2.5%

5%

2.

Silver Dore

2.5%

4.35%

S. No

Commodity

From

To

1.

Coal, peat, lignite

1.5%

Nil

2.

New pneumatic tyres, of rubber , of a kind used on aircraft as mentioned in Entry 280 A of Notification No. 50/2017-Cus

Nil

0.5%

3.

Gold bar

2.5%

5%

4.

Gold Dore

2.5%

4.35%

5.

Platinum other than rhodium and goods covered under S. Nos. 415(a) and 415A of the Table in notification No. 50/2017-Customs, dated the 30th June, 2017.

1.5%

5.4%

6.

Airplanes and other aircraft covered under S.No. 543A of Notification No. 50/2017-Cus

Nil

0.5%

S.No

S.No.in Notification No50/2017-cus/ Notification No

Commodity

From

To

ExtendedbyfiveyearsuptoMarch 31, 2028

1.

S.No609of 50/2017-

Customs

Usedbonafidepersonal and household effects of a deceased person

2.

33/2017-

Customs

Exemptiontoimport/reimport of challenge cups and trophies won by a unit of Defence Force or its members.

3.

41/2017-

Customs

Exemption to import of cups, trophies to be awarded to winning teams in international tournament /world cup to be held in India.

4.

146/94-

Customs

Exemption to import of specified sports goods imported by National Sports Federation or by a Sports person of outstanding eminence for training.

5.

90/2009-

Customs

Exemption to imports from Antarctica of goods used for or related to Indian Antarctic Expedition or Indian Polar Science Programme.

Extended by two years upto March 31, 2025

1.

168

Specific inputs and sub-parts for use in manufacture of telecommunication grade optical fibre or optical fibre cables

Nil

Nil

2.

341

Preformofsilicaforuseinthemanufacture of telecommunication grade optical fibres or optical fibre cables

5%

5%

3.

341A

Inputs for manufacture of Preform of silica

Nil

Nil

4.

405, 406

Raw materials and parts for manufacture of Wind operated electricity generators, including permanent magnets for manufacture of PM synchronous generators above 500KW for use in wind-operated electricity operators

5%

5%

5.

559

Rawmaterialandparts(including Dredger) for use in the manufacture of ships/vessels

Nil

Nil

6.

166

SpecifiedDrugs,medicines,diagnostics kits

5%

5%

7.

167

Lifesavingdrugsetc

Nil

Nil

Extended by oneyearuptoMarch 31, 2024

1.

368

Ferrouswasteandscrap

Nil

Nil

2.

374,375

Rawmaterialsforuseinmanufactureof CRGO steel

Nil

Nil

3.

527A

Lithium-ion cell for use in the manufacture of battery or battery pack of cellular mobile phone

5%

5%

4.

527B

Lithium-ion cell for use in the manufacture of battery or battery pack of electrically operated vehicle (EVs) or hybrid motor vehicle

5%

5%

5.

237

Specified inputs for use in the manufacture ofEVAsheetorbacksheetswhichareused in the manufacture of solar cell or modules

Nil

Nil

6.

340

Solar tempered glass for use in the manufacture of solar cell or solar module

Nil

Nil

Current provisions

Proposed provisions

Effect of changes made

Clause 123 - Section – 25 (Power to grant exemption from duty)

(4A) Where any exemption is granted subject to any condition under sub-section (1), such exemption shall, unless otherwise specified or varied or rescinded, be valid up to 31st day of March falling immediately after two years from the date of such grant or variation:

Provided that in respect of any such exemption in force as on the date on which the Finance Bill, 2021 receives the assent of the President, the said period of two years shall be reckoned from the 1st day of February, 2021;

Provided further that nothing contained in this subsection shall apply to any such exemption granted to, or inrelation to,––

(a) any multilateral or bilateral trade agreement;

(b) obligations under international agreements, treaties, conventions or such other obligations including with respect to United Nations agencies, diplomats and international organisations;

(c) privileges of constitutional authorities;

(d) schemes under the Foreign Trade Policy;

(e) the Central Government schemes having validity of more than two years;

(f) re-imports, temporary imports, goods imported as gifts or personal baggage;

(g) any duty of customs under any law for the time being in force, including integrated tax leviable under sub-section (7) of section 3 of the Customs Tariff Act,1975, other than duty of customs leviable under section 12.

Section 25 of the Customs Act is being amended to insert a Proviso to subsection (4A) toprovide that the validity of two years shall not apply to exemption notifications issued inrelation to multilateral or bilateral trade agreements; obligations under international agreements, treaties, conventions; UN agencies, diplomats, international organizations;privileges of constitutional authorities; schemes under Foreign Trade Policy or otherCentral Government schemes having a validity of more than two years; re-imports,temporary imports, goods imported as gifts or personal baggage; any duty of customsimposed under any law in force including integrated tax leviable under sub-section 7 ofSection 3 of the Customs Tariff Act, 1975, other than under Section 12 of the Customs Act.

Clause 124 - Section –127C (Procedure on receipt of application under section 127B)

"(8A) The order under sub-section (5) shall be passed

within a period of nine months from the last day of the month in which the application under section 127B is made, and if,no order is passed within the said period, the settlement

proceedings shall abate, and the adjudicating authority beforewhom the proceeding at the time of making the application was pending shall dispose of the application in accordance with the provisions of this Act as if no application under thesaid section had been made:

Provided that the period specified under this sub-sectionmay, for reasons to be recorded in writing, be extended by theSettlement Commission for a further period not exceeding three months.

Provided further that in respect of any application pending under sub-section (5) as on the date on which the Finance Bill, 2023 receives the assent of the President, thesaid period of nine months shall be reckoned from the date onwhich the said Finance Bill receives the assent of the

President.".

Section 127 C of the Customs Act is being amended to insert sub section (8A) to specify atime limit of 9 months from the date of application, for disposal of the application filedbefore the Settlement Commission.

Current provisions

Proposed provisions

Effect of changes made

Clause 125(i) - Section – 9 (Countervailing duty on subsidized articles)

(6) The countervailing duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry up to five years from the date of such imposition :

Provided that if the Central Government, in a review, is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of subsidization and injury, it may, from time to time, extend the period of such imposition for a further period of five years and such further period shall commence from the date of order of such extension :

Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to a conclusion before such expiry, the countervailing duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year.

Provided also that if the said duty is revoked temporarily, the period of such revocation shall not exceed one year at a time

(6) The countervailing duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry up to five years from the date of such imposition :

Provided that if the Central Government, in a reviewon consideration of a review is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of subsidization and injury, it may, from time to time, extend the period of such imposition for a further period of five years and such further period shall commence from the date of order of such extension :

Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to a conclusion before such expiry, the countervailing duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year.

Provided also that if the said duty is revoked temporarily, the period of such revocation shall not exceed one year at a time

Section 9 (6) of the Customs Tariff Act, 1975is being amended to remove the ambiguity and clarify that determination and review for countervailing duty refers todetermination and review of countervailing duty in a mannerprescribed by rules under the Custom Tariff Act.

The amendment is beingvalidated retrospectively witheffect from January 1, 1995.

(7) The amount of any such subsidy as referred to in sub-section (1) or sub-section (2) shall, from time to time, be ascertained and determined by the Central Government, after such inquiry as it may consider necessary and the Central Government may, by notification in the Official Gazette, make rules for the identification of such article and for the assessment and collection of any countervailing duty imposed upon the importation thereof under this section.

(7) The amount of any such subsidy as referred to in sub-section (1) or sub-section (2) shall, from time to time, be ascertained and determinedby the Central Government, after such inquiry as it may consider necessary and the Central Government may, by notification in the Official Gazette, make rules for the identification of such article and for the assessment and collection of any countervailing duty imposed upon the importation thereof under this section.

Section 9 (7) of the Customs Tariff Actis being amended to omit the word ‘and determined’to clearly amplify the intent and scope of this provision. The amendment is beingvalidated retrospectively witheffect from January 1, 1995.

.

Clause 125(ii) - Section – 9A (Anti-dumping duty on dumped articles)

(5) The anti-dumping duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition :

 Provided that if the Central Government, in a review, is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, from time to time, extend the period of such imposition for a further period 9[up to five years] and such further period shall commence from the date of order of such extension :

 Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to a conclusion before such expiry, the anti-dumping duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year.

Provided also that if the said duty is revoked temporarily, the period of such revocation shall not exceed one year at a time

(5) The anti-dumping duty imposed under this section shall, unless revoked earlier, cease to have effect on the expiry of five years from the date of such imposition :

 Provided that if the Central Government, in a review, on consideration of a review is of the opinion that the cessation of such duty is likely to lead to continuation or recurrence of dumping and injury, it may, from time to time, extend the period of such imposition for a further period 9[up to five years] and such further period shall commence from the date of order of such extension :

 Provided further that where a review initiated before the expiry of the aforesaid period of five years has not come to a conclusion before such expiry, the anti-dumping duty may continue to remain in force pending the outcome of such a review for a further period not exceeding one year.

Provided also that if the said duty is revoked temporarily, the period of such revocation shall not exceed one year at a time

Section 9 A (5) of the Customs Tariff Actis amended to remove the ambiguity and clarify that determination and review for anti-dumping duty refers to determination and review in a manner prescribed by rules under the Custom Tariff Act.

The amendment is beingvalidated retrospectively witheffect from January 1, 1995.

(6) The margin of dumping as referred to in sub-section (1) or sub-section (2) shall, from time to time, be ascertained and determined by the Central Government, after such inquiry as it may consider necessary and the Central Government may, by notification in the Official Gazette, make rules for the purposes of this section, and without prejudice to the generality of the foregoing, such rules may provide for the manner in which articles liable for any anti-dumping duty under this section may be identified, and for the manner in which the export price and the normal value of, and the margin of dumping in relation to, such articles may be determined and for the assessment and collection of such anti-dumping duty.

(6) The margin of dumping as referred to in sub-section (1) or sub-section (2) shall, from time to time, be ascertained and determinedby the Central Government, after such inquiry as it may consider necessary and the Central Government may, by notification in the Official Gazette, make rules for the purposes of this section, and without prejudice to the generality of the foregoing, such rules may provide for the manner in which articles liable for any anti-dumping duty under this section may be identified, and for the manner in which the export price and the normal value of, and the margin of dumping in relation to, such articles may be determined and for the assessment and collection of such anti-dumping duty.

Section 9 A (6) of the Customs Tariff Actis being amended to omit the word ‘and determined’ to clearly amplify the intent and scope of this provision.

The amendment is beingvalidated retrospectively witheffect fromJanuary 1, 1995.

Clause 125(iii) - Section – 9C (Appeal)

(1) An appeal against the order of determination or review thereof shall lie to the Customs, Excise and Service Tax Appellate Tribunal constituted under section 129 of the Customs Act, 1962 (52 of 1962.) (hereinafter referred to as the Appellate Tribunal), in respect of the existence, degree and effect of-

(i) any subsidy or dumping in relation to import of any article; or

(ii) import of any article into India in such increased quantities and under such condition so as to cause or threatening to cause serious injury to domestic industry requiring imposition of safeguard duty in relation to import of that article.

(1) An appeal against the order ofdetermination or review thereof shall lie to the Customs, Excise and Service Tax Appellate Tribunal constituted under section 129 of the Customs Act, 1962 (52 of 1962.) (hereinafter referred to as the Appellate Tribunal), in respect of the existence, degree and effect of-

(i) any subsidy or dumping in relation to import of any article; or

(ii) import of any article into India in such increased quantities and under such condition so as to cause or threatening to cause serious injury to domestic industry requiring imposition of safeguard duty in relation to import of that article.

Section 9 C (1) of the Customs Tariff Actis amended to omit the word ‘order of’ toremove ambiguity and clarify that appeals under this section lieagainst the determination or review thereof made by an authority ina manner as specified by rules notified under Sections 8 B, 9, 9Aand 9B of the Custom Tariff Act.The amendment is beingvalidated retrospectively witheffect from January 1, 1995.

(2) Every appeal under this section shall be filed within ninety days of the date of order under appeal :

Provided that the Appellate Tribunal may entertain any appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time.

(2) Every appeal under this section shall be filed within ninety days of the date of order determination or review under appeal :

Provided that the Appellate Tribunal may entertain any appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from filing the appeal in time.

Section 9 C (2) of the Customs Tariff Actis amendedtoremove ambiguity and clarify that appeals under this section lieagainst the determination or review thereof made by an authority ina manner as specified by rules notified under Sections 8 B, 9, 9Aand 9B of the Custom Tariff Act.The amendment is beingvalidated retrospectively witheffect from January 1, 1995.

(3 ) The Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or annulling the order appealed against.

(3 ) The Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders determination or review thereon as it thinks fit, confirming, modifying or annulling the orderdetermination or review appealed against.

Section 9 C (3) of the Customs Tariff Actis being amended toremove ambiguity and clarify that appeals under this section lieagainst the determination or review thereof made by an authority ina manner as specified by rules notified under Sections 8 B, 9, 9Aand 9B of the Custom Tariff Act.The amendment is beingvalidated retrospectively witheffect from January 1, 1995.

(5) Every appeal under sub-section (1) shall be heard by a Special Bench constituted by the President of the Appellate Tribunal for hearing such appeals and such Bench shall consist of the President and not less than two members and shall include one judicial member and one technical member.

Explanation.––For the purposes of this section, "determination" or "review" means the determination or review done in such manner as may be specified in the rules made under sections 8B, 9, 9A and 9B.

Explanation has been inserted after Section 9 C (5) of the Customs Tariff Actto providethe meaning of determination or review thereof.The amendment is beingvalidated retrospectively witheffect from January 1, 1995.

Clause 126-AMENDMENTS IN FIRST SCHEDULE TO THE CUSTOMS TARIFF ACT, 1975

In the Customs Tariff Act, the First Schedule shall––

(a) be amended in the manner specified in the Second Scheduleto the Finance Bill 2023 to increase the tariff rates on certain tariff items with effectfrom February 2, 2023.

(b) be amended in the following manner specified in Third Schedule to the Finance Bill 2023:

Ø to modify the tariff rates on certain tariff items as part of rationalization of customs duty rate structure with effect from thedate of assent to the Finance Bill 2023.

Ø to exclude solar power plant/solar power project from the purview of Project Imports under heading 9801 with effect from the date ofassent to the Finance Bill 2023.

(c) also be amended in the manner specified in the Fourth Shedule to the Finance Bill, 2023 to align theabbreviations and the tariff with complementary amendments to the HS 22. The amendment will come into effect from May 1, 2023.

Clause 127-AMENDMENTS IN SECOND SCHEDULE TO THE CUSTOMS TARIFF ACT, 1975

In the Customs Tariff Act, the Second Schedule shall––

(a) be amended in the manner specified in the Fifth Schedule of the Finance Bill 2023 to align the entries under heading 1202 with thatof the First Schedule of the Cutsom Tariff Act, 1975. The amendment will come into effect from May 1, 2023.

Customs

S. No.

Notification No.

Description

1.

02/2023-Customs dated February 1, 2023

Seeks to further amend notification No. 50/2017-Customs, dated the June 30, 2017, so as to revise/provide exemption(s) on the specified goods.

2.

03/2023-Customs dated February 1, 2023

Seeks to further amend notification No. 11/2021-Customs dated February 1, 2021, so as to levy/exempt Agriculture and Infrastructure Development Cess (AIDC) on certain items.

3.

04/2023-Customsdated February 1, 2023

Seeks to further amend notification No. 11/2018-Customs, dated February 2, 2018, to revise/provide Social Welfare Surcharge (SWS) exemption(s) on specified goods.

4.

05/2023-Customs dated February 1, 2023

Seeks to rescind notification No. 13/2021-Customs and 34/2022-Customs, related to Social Welfare Surcharge (SWS).

5.

06/2023-Customs dated February 1, 2023

Seeks to further amend notification No. 25/1999- Customs, 25/2002-Customs and 57/2017-Customs related to certain electronic items.

6.

07/2023-Customs dated February 1, 2023

Seeks to further amend notification No. 230/86- Customs related to Project Import Regulations.

7.

08/2023-Customs dated February 1, 2023

Seeks to further amend notification No. 22/2022- Customs regarding India-UAE Comprehensive Economic Partnership Agreement.

8.

09/2023-Customs dated February 1, 2023

Seeks to further amend notification No. 57/2000- Customs which exempts gold, silver and platinum imported under specified schemes.

9.

10/2023-Customs dated February 1, 2023

Seeks to further amend notification No. 146/94- Customs, dated the July 13, 1994 to extend the exemption benefit to Warm blood horse for equestrian sports and extend the validity of said notification up to the March 31, 2028.

10.

11/2023-Customs dated February 1, 2023

Seeks to amend the notification Nos. 90/2009- Customs, dated the September 7, 2009, 33/2017- Customs, dated the June 30, 2017, and 41/2017- Customs, dated the 30 June, 2017 to extend the validity of said notifications up to the March 31, 2028

11.

12/2023-Customs dated February 1, 2023

Seeks to amend 32 notifications in order to provide a specific end date for these notifications.

Central Excise

S. No.

Notification No.

Description

1.

05/2023-Central Excise dated February 1, 2023

Seeks to exempt Compressed Natural Gas (CNG) from so much of the duty of excise leviable on amount of GST paid on Biogas or Compressed Biogas which is blended with CNG.

Tariff item

Description

Unit

NCCD rates

(in Rs. Per thousand)

From

To

(1)

(2)

(3)

(4)

(5)

2402 20 10

Other than filter igarettes, of length notexceeding 65 millimetres

Tu

200

230

2402 20 20

Other than filter cigarettes, of length exceeding 65 millimetres but not exceeding 70 millimetres

Tu

250

290

2402 20 30

Filter cigarettes of length (including the

length of the filter, the length of filterbeing 11 millimetres or its actual length,whichever is more) not exceeding 65 millimetres

Tu

440

510

2402 20 40

Filter cigarettes of length (including the length of the filter, the length of filterbeing 11 millimetres or its actual length,whichever is more) exceeding 65millimetres but not exceeding 70millimetres

Tu

440

510

2402 20 50

Filter cigarettes of length (including thelength of the filter, the length of filterbeing 11 millimetres or its actual length,whichever is more) exceeding 70millimetres but not exceeding 75 millimetres

Tu

545

630

2402 20 90

Other

Tu

735

850

2402 90 10

Cigarettes of tobacco substitutes

Tu

600

690