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CMA Final · Indirect Tax Laws and Practice · Valuation and Related Party Transactions

Under section 14 of the Customs Act, 1962, the price of imported goods is converted into rupees using the rate of exchange in force on which date?

The exchange rate in force on the date the bill of entry is presented under section 46 applies. The proviso to section 14(1) fixes this date for converting the price of imported goods, and for exports the shipping bill date under section 50 is used.

  1. AThe date on which the bill of entry is presented under section 46Correct
  2. BThe date of the import contract
  3. CThe date on which the vessel leaves the port of loading
  4. DThe date on which duty is finally paid

Explanation

The third proviso to section 14(1) says the price is calculated with reference to the rate of exchange in force on the date a bill of entry is presented under section 46 (or a shipping bill under section 50 for exports). The contract date or the duty payment date is not the reference date. Payment date is relevant only to section 15(1)(c) for other goods, and that concerns the rate of duty.

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