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CMA Final · Indirect Tax Laws and Practice · Remission of Duties

Arvind Imports wants to relinquish title to a consignment before any order for clearance for home consumption under section 47 has been made. Under section 23(2) of the Customs Act, 1962, in which situation can it NOT relinquish title?

Relinquishment is not allowed where an offence appears to have been committed regarding the goods. Section 23(2) permits an owner to relinquish title before a clearance or warehousing order and escape duty, but its proviso excludes goods connected with an apparent offence.

  1. AThe goods are unsold and lying at the port
  2. BThe goods are in a transit shed awaiting examination
  3. CAn offence under the Act appears to have been committed regarding the goodsCorrect
  4. DThe goods have not yet been permitted to be deposited in a warehouse

Explanation

Section 23(2) lets the owner relinquish title before a clearance order under section 47 or a warehousing order under section 60, and then he is not liable for duty. The proviso bars relinquishment for goods in respect of which an offence appears to have been committed under the Act or any other law. The other situations are within the permitted window.

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