Project import - Applicability of exempted individual goods to goods forming part of project import - Customs - F. No. 528/213/87-Cus. (T.U.) ICD

Project import - Applicability of exempted individual goods to goods forming part of project import F. No. 528/213/87-Cus. (T.U.) ICD Dated 8-8-1987 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Project Imports - Applicability of exemption on individual goods to goods forming part of project imports - Propriety and legality regarding. Find enclosed copy of D.O. letter No. S/5-433/86C, dated the 2nd June, 1987 from Collector of Customs, Bombay on the subject noted above. 2. The board have reviewed the position. As is well-known the basic idea underlying the creation of a tariff item pertaining to 'project imports' is simplification of assessment in as much as all imports required for a project are subjected to a uniform rate of duty. The assessment to customs duty is dependent on the classification of goods. Once a contract is registered as for initial setting up or for substantial expansion of an existing plant etc., the imports covered by the contract become classifiable under the Heading No. 98.01 of the Customs Tariff liable to duty at the project rate (earlier Heading No. 84.66 of CTA). Such goods forming part of the contract and assessed under Heading 98.01 lose their identity and cannot be classified on merits under any other heading of the Customs Tariff. Hence any differential rate of duty prescribed by exemption notification on individual goods (other than those for goods specifically covered under tariff heading 98.01) will not come into play for the assessment of project goods. Board also approves the view expressed by the Collector of Customs, Bombay that once a contract for project import is registered with the Customs House, no de-registration of the same or a part thereof should be allowed.