Dear Sir

We are procuring Chrome Concentrate from Domestic Suppliers in Orissa and process the same and export to China.  VSEZ Customs Collecting Duty amount for an amount of Rs. 3006/ PMT at the time receiving material from our works and giving permission for allowing  trucks  inside the VSEZ. For your information, we have started the business in the year 2006 and at the time they are not collected any duty amount.  In the year 2008 the stopped our exports stating that the said material  restricted and export through MMTC and even though you have to pay Rs. 3006 PMT. But we have already gone to High Court and got writ and court has given the order stating that to collect approriate duties and allow for export.  

Hence  we request you to please let us know whether we have to pay export duty  for the said material?

Please clarify

Regards

S.K.Raju

Manager- Logistics

Magma Metal Pvt Ltd.,

VSEZ, Visakhapatnam

Dear Sir

We are procuring Chrome Concentrate from Domestic Suppliers in Orissa and process the same and export to China.  VSEZ Customs Collecting Duty amount for an amount of Rs. 3006/ PMT at the time receiving material from our works and giving permission for allowing  trucks  inside the VSEZ. For your information, we have started the business in the year 2006 and at the time they are not collected any duty amount.  In the year 2008 the stopped our exports stating that the said material  restricted and export through MMTC and even though you have to pay Rs. 3006 PMT. But we have already gone to High Court and got writ and court has given the order stating that to collect approriate duties and allow for export.  

Hence  we request you to please let us know whether we have to pay export duty  for the said material?

Please clarify

Regards

S.K.Raju

Manager- Logistics

Magma Metal Pvt Ltd.,

VSEZ, Visakhapatnam

This is a slightly tricky issue. There is custom duty on export of iron ore.Supply to SEZ is treated as physical export. Hence the departmental view  that custom duty should be paid when the goods are exported to SEZ. On the face of it, the departmental view has prima facie strength.

As the issue is important in your business, you should approach some good professional to study the issue in detail, with respect to applicability of SEZ Act & Custom Act- and particularly whether custom duty can be indirectly imposed through a deeming provision in non tariff Act. It is to be examined in that context.