Indirect Tax Laws · Importation and Exportation of Goods

Re-importation of Goods (Section 20 of the Customs Act, 1962)

Updated 5 October 2026 · Fact-checked

Section 20 of the Customs Act, 1962 treats goods brought back after export as imports. They are liable to duty and to the conditions and restrictions that apply to like goods of like value. To solve a question, value the goods afresh, apply the rates in force, then check any exemption notification given.

Understand Re-importation of Goods (Sec 20)

Goods go out of India for many reasons. A buyer may reject them. They may be sent abroad for repair, testing or an exhibition. When they come back, customs has to decide how to treat them.

Section 20 gives a simple rule. Goods imported into India after exportation are liable to duty, and subject to all conditions and restrictions, to which goods of the like kind and value are liable on importation. The law does not care that the goods were originally Indian. Once they cross the border inward, they are imports.

This means a re-import is not automatically duty-free. Full duty applies unless an exemption notification under Section 25 covers the case. Such notifications often exist for goods exported for repair, reconditioning or return after rejection, but they carry their own conditions. In the exam, apply only the notification or conditions the question gives you.

The second half of the rule matters as much. Conditions and restrictions apply too. If like goods need a licence, or are prohibited or restricted for import, the re-imported goods face the same position. Check this before you compute any duty.

The duty is worked out like any import. You determine the assessable value under Section 14, apply the rates on the relevant date, and add Basic Customs Duty, Social Welfare Surcharge and IGST as applicable.

Key rules to remember

Rule of Section 20: Re-imported goods = liable to duty + subject to conditions and restrictions applicable to goods of like kind and value on import; Exportation in the past does not give automatic relief. Relief comes only from an exemption notification.
Assessable value (sea or air import): Assessable value = CIF value (cost + insurance + freight) + landing charges at 1% of CIF, where actual figures are not given; Use the 1% addition only if the question does not give actual landing charges, and apply it only where the question's facts support it. Say your assumption.
Basic Customs Duty (BCD): BCD = Assessable value × BCD rate; Use the rate given in the question.
Social Welfare Surcharge (SWS): SWS = BCD × SWS rate (the question gives it, commonly 10% of BCD); It is levied on BCD, not on assessable value. Apply it only if the question treats it as applicable.
IGST on imports: IGST = (Assessable value + BCD + SWS) × IGST rate; IGST is charged on the value plus customs duties, so it is a cascading base.
Total duty payable: Total = BCD + SWS + IGST; Add compensation cess only if the question mentions it.

How to solve Re-importation of Goods (Sec 20) questions

Use this order for any Section 20 question. It works for both theory and numerical cases.

1Confirm the facts: were the goods exported from India and are they now being brought back? If yes, Section 20 applies.
2State the rule in one sentence: re-imported goods are liable to duty and to conditions and restrictions applicable to like goods of like value.
3Check conditions and restrictions. Is the item prohibited, restricted or does it need a licence or permission on import? Mention the outcome.
4Check for an exemption notification in the question. Note its conditions, such as the purpose of export, the time limit, or refund of drawback or export benefits already taken. If none is given, say full duty applies.
5Fix the assessable value under Section 14. Add landing charges at 1% of CIF only if actual figures are not given.
6Compute BCD, then SWS on BCD, then IGST on (value + BCD + SWS). If an exemption covers only part of the value, apply duty only to that part.
7Conclude with the total duty payable and state your assumptions clearly.

Quickest way: Three-line approach for the exam hall

When to use it: Use this when time is short, in a numerical on re-import duty or a 5-mark theory answer.

Line 1: quote Section 20 in plain words: goods imported after export are dutiable like any like goods and face the same conditions and restrictions.
Line 2: state whether any notification exemption applies, and which part of the value stays taxable.
Line 3: compute in a column: Value, BCD, SWS, IGST base, IGST, Total. Write every assumption beside it.

Common mistakes in Re-importation of Goods (Sec 20)

Writing that re-imported goods are always exempt from duty because they were Indian goods.
Students confuse Section 20 with the relief notifications for repair or return of goods.
Fix: Start with the rule: duty is payable. Exemption comes only from a notification, and only if its conditions are met.
Ignoring conditions and restrictions on the goods.
Students focus on the duty calculation and forget the second limb of Section 20.
Fix: Add one line on prohibitions, licences and restrictions applicable to like goods on import.
Charging IGST on the assessable value alone.
Students treat IGST like a domestic GST calculation on the invoice value.
Fix: Compute IGST on assessable value + BCD + SWS.
Charging SWS on assessable value instead of BCD.
Students apply every levy to the same base.
Fix: SWS is a percentage of BCD. Compute BCD first, then SWS.
Using the export-time value or the original export invoice as the base.
Students think the earlier export fixes the value.
Fix: Value the goods afresh at the time of re-import under Section 14, including repair or other charges where they form part of the value.
Quoting a notification number or condition from memory when the question does not give one.
Students try to show extra knowledge.
Fix: Rely on the facts and notification terms given in the question. If you do not know the exact number, describe the exemption in words.

Worked examples

Example 1

Mehta Components Ltd exported machine parts to a buyer abroad. The buyer rejected the consignment and the parts were shipped back to India. No exemption notification applies. The CIF value at re-import is ₹10,00,000. Landing charges are not separately given and the goods came by sea. Assume BCD 10%, SWS 10% of BCD and IGST 18%. The parts are freely importable. Compute the customs duty payable.

Show the solution

Section 20 applies. The parts were exported and are now imported, so they are liable to duty and to the conditions and restrictions that apply to like goods on import.
The parts are freely importable, so there is no restriction issue. No exemption applies, so the full duty is payable.
Assessable value = ₹10,00,000 + 1% landing charges ₹10,000 = ₹10,10,000.
BCD at 10% = ₹1,01,000.
SWS at 10% of BCD = ₹10,100.
IGST base = ₹10,10,000 + ₹1,01,000 + ₹10,100 = ₹11,21,100.
IGST at 18% = ₹2,01,798.
Total duty = ₹1,01,000 + ₹10,100 + ₹2,01,798 = ₹3,12,898.

Answer: Total customs duty payable on re-importation is ₹3,12,898 (BCD ₹1,01,000, SWS ₹10,100, IGST ₹2,01,798).

Example 2

An exporter sent equipment abroad for repair. On return, a notification (assume the question states it) exempts the re-imported goods from duty except on the value of the repairs carried out abroad, and the exporter meets its conditions. Repair charges are ₹2,00,000. Assume the duty is levied only on this value, BCD 10%, SWS 10% of BCD and IGST 18%, and ignore landing charges. Compute the duty and explain the legal basis.

Show the solution

Legal basis: under Section 20, re-imported goods are dutiable like like goods. The relief comes from the notification issued under Section 25, not from Section 20 itself.
As the conditions are met, duty is charged only on the repair value. The remaining value of the goods is exempt.
Assessable value = ₹2,00,000.
BCD at 10% = ₹20,000.
SWS at 10% of BCD = ₹2,000.
IGST base = ₹2,00,000 + ₹20,000 + ₹2,000 = ₹2,22,000.
IGST at 18% = ₹39,960.
Total duty = ₹20,000 + ₹2,000 + ₹39,960 = ₹61,960.

Answer: Duty payable is ₹61,960 (BCD ₹20,000, SWS ₹2,000, IGST ₹39,960), on the assumption that the notification exempts everything except the repair value. If any condition fails, full duty applies on the whole value.

Exam tips

Open every answer with the Section 20 rule in your own words. Examiners look for the phrase 'like kind and value' and for 'conditions and restrictions'.
In numericals, show the column of Value, BCD, SWS, IGST base, IGST and Total. Marks go to the steps even if a figure slips.
Write your assumptions in a line: rates used, 1% landing charges, SWS applicability. This protects marks if the question is silent.
Read the question for exemption conditions such as purpose of export or repair. If a condition is not met, say full duty applies.
In case-scenario MCQs, check whether the goods are restricted on import before choosing an answer about duty. There is no negative marking, so always attempt.

Practice questions from Importation and Exportation of Goods

Re-importation of Goods (Sec 20): frequently asked questions

What does Section 20 of the Customs Act say?

It says that goods imported into India after exportation are liable to duty. They are also subject to all conditions and restrictions that apply to goods of the like kind and value on importation. Exportation earlier does not give a separate exemption.

Is duty payable on goods that are returned by a foreign buyer?

Under Section 20, yes, unless an exemption notification covers the case and you meet its conditions. Without such a notification, you pay duty as for any import. Always check the facts and the notification in the question.

How is duty calculated on re-imported goods?

Fix the assessable value under Section 14 and add landing charges where required. Then compute BCD, SWS on the BCD, and IGST on the value plus BCD and SWS. If an exemption covers only part of the value, charge duty on the remaining part.

How is Section 20 different from drawback on re-export under Section 74?

Section 20 deals with goods exported from India and brought back. Section 74 deals with goods imported on payment of duty and later re-exported, where drawback of the duty may be claimed. One is about the inward return of exported goods, the other about the outward return of imported goods.