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CA Final · Indirect Tax Laws · Importation and Exportation of Goods

Rao Industries exported a machine from India and later brought the same machine back into India. Under section 20 of the Customs Act, 1962 as it now stands, how are such re-imported goods treated?

Re-imported goods are liable to duty and subject to all conditions and restrictions applicable to goods of like kind and value on importation. Section 20 contains no automatic exemption, concession or time limit, since its provisos and Explanations were omitted.

  1. AThey are exempt from customs duty because they originated in India
  2. BThey are liable to duty and subject to the conditions and restrictions to which goods of the like kind and value are liable on importationCorrect
  3. CThey are liable only to a concessional duty equal to 50% of the normal duty
  4. DThey are liable to duty only if re-imported within one year

Explanation

Section 20 states that goods imported into India after exportation are liable to duty and subject to all conditions and restrictions applicable to goods of the like kind and value on importation. The earlier provisos and Explanations were omitted, so no automatic exemption, fixed concession or one-year condition appears in the section.

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