Budget Notes 2010-2011 – TRU Letter and
Chapter wise Explanatory Notes
Text of D.O.F.No.334/ 1/2010-TRU New
Delhi, dated the 26th February, 2010 from Commissioner TRU to All Chief
Commissioner/Commissioner
The Finance
Minister has introduced the Finance Bill, 2010 in Lok Sabha today, i.e., 26th
February, 2010. Changes in excise and customs duties have been proposed through
the Finance Bill, 2010 (clauses 57 to clause 74, clauses 82 to 86) and through
Notification Nos. 15/2010-Customs to 31/2010-Customs, 18/2010-Customs (NT),
3/2010-CE to 18/2010-CE, and 10/2008-CE (NT) to 14/2008-CE (NT), all dated 27th
February, 2010. Changes in rates of duty (unless otherwise stated) take effect
from the midnight of 26th February/27th February of 2010. The legislative
changes, except through clauses 60, 62, 74, 85 and 86 declared under the
Provisional Collection of Taxes Act, 1931, would come into effect only upon the
enactment of the Finance Bill, 2010.
2. The important changes in respect
of customs and Central excise duty are discussed below.
EXPLANATORY NOTES
(CUSTOMS)
Note: All changes come into effect
immediately unless otherwise specified.
Peak Rate:- There is no change in the peak rate of Customs Duty.
Chapter wise changes in customs duty rates, are given
below:
No change
9.1 Customs duty on Long pepper
(Piper longum) is being reduced from 70% to 30%. (S.
No. 17A of notification No.21/2002-customs as amended vide notification
no. 21/2010-Customs dated 27.2.2010 refers)
No change
13.1 Customs duty on Asafoetida is being reduced from 30% to 20%. (S. No. 26A of
notification No.21/2002-customs as amended vide notification no.
21/2010-Customs dated 27.2.2010 refers)
No change
The existing slab of filter
cigarettes of length not exceeding 70 mm is being broken up into two slabs:
filter cigarettes of length not exceeding 60 mm; and filter cigarettes of
length exceeding 60 mm but not exceeding 70 mm. The existing rate of 30% is
being prescribed for the new tariff item also. (Clause 62 of Finance Bill, 2010
read with Third Schedule refers)
No change
26.1. Customs duty on gold ores and
concentrates for use in manufacture of gold is being fully exempted. These
goods will, however, be levied concessional CVD at the rate of Rs.140 per 10 gms of gold content. Gold ore is also being fully exempted
from additional duty of customs (special CVD). All the above concessions are
subject to end use condition. (S. No.518A of notification No. 21/2002- Customs,
dated 01.03.2002 as inserted vide S. No.
(xxv) of notification No. 21/2010-Customs dated
27.2.2010; S. No.8A of notification No. 20/2006- Customs, dated 01.03.2006 as
inserted vide S. No. (i) of notification No.
24/2010-Customs, dated 27.02.2010 refers).
27.1 Outright exemption from 4%
Additional Duty of Customs (Special CVD) is being provided to Carbon Black Feed
Stock (S. No. 68 of notification No.20/2006-customs as amended vide
notification no. 24/2010-Customs dated 27.2.2010 refers).
27.2 Basic customs duty on crude is
being increased from Nil to 5% (S. No. 487 of notification No.21/2002-customs
as amended vide notification no. 21/2010-Customs dated 27.2.2010 refers)
27.3 Basic customs duty on Motor
Spirit (Petrol) and HSD (Diesel) is being increased from 2.5% to 7. 5% (S. No.
488A & 488B of notification No.21/2002-customs as amended vide notification
no. 21/2010-Customs refers)
27.4 Basic customs duty on other
petroleum products is being increased from 5% to 10% However, Naphtha, LPG,
LNG, Petroleum Gases and Pet coke continue to attract 5% basic customs duty (S.
No. 592 to 596 of notification No.21/2002-customs as amended vide notification
no. 21/2010-Customs dated 27.2.2010 refers)
27.5 Sub-heading 2712 20, tariff
items 2712 20 10 and 2712 20 90 are being substituted with tariff item 2712 20
00 covering „Paraffin wax containing by weight less than 0.75% of oil and after
the tariff item 2712 90 30, tariff item 2712 90 40 is being inserted for
„Paraffin wax containing by weight 0.75% of oil or more (Clause 62 of Finance
Bill, 2010 read with Third Schedule refers)
27.6 Electrical energy removed from
a Special Economic Zone to the Domestic Tariff Area and non - processing areas
of SEZ would now attract duty of 16% ad valorem + Nil Special CVD. This change
is being made retrospectively w.e.f. 26th June, 2009.
Exemption on supplies or imports of electrical energy, other than the above,
would continue to be exempt. Import of electrical energy is also being fully
exempted from 4% Special CVD. While the increase in duty comes into effect
immediately under the provisions of Provisional Collection of Taxes Act, the
exemptions will come into force only on the date of enactment of the Finance
Bill, 2010. Consequently, exemption from basic customs duty and from 4% Special
CVD mentioned above are being provided for the intervening period through
notifications. (Notification Nos. 25/2010- customs & 26/2010-Customs both
dated 27.2.2010 and Clause 60 read with the Second Schedule of the Finance
Bill, 2010 refers.)
No change
39.1 Full exemption from basic
customs duty is being provided to compostable polymers/bio-plastic used for
manufacture of bio-degradable agro mulching films, nursery plantation and
flower pots. (S.No. 142B of the notification No.
21/2002-Customs, dated 01.03.2002 as inserted vide Notification No.
21/2010- Customs dated 27.02.2010 refers).
39.2 Full exemption from basic
customs duty and additional duty of customs equivalent to excise duty (CVD) is
being provided to imports of security fibre, security
threads, M-feature for use in the manufacture of Security paper by Security
Paper Mill Hoshangabad. (S.No.
of the notification No. 21/2002-Customs, dated 01.03.2002 as inserted vide Notification
No. 24/2010- Customs dated 27.02.2010 refers).
No change
47.1 Outright exemption from 4%
Additional Duty of Customs (Special CVD) is being provided to wastepaper and
paper scrap (S.No. 69 of the notification No.
20/2006-Customs, dated 01.03.2006 as inserted vide Notification No. 24/2010-
Customs dated 27.02.2010 refers).
No change
71.1. Basic customs duty rate on
gold, silver and platinum are being revised as under:-
|
SNo. |
Item
|
From
|
To
|
|
1.
|
Gold
bars, other than tola bars, bearing Manufacturers
or refiner s engraved serial number and weight expressed in metric units, and
gold coins |
Rs.
200 per 10 gm |
Rs.
300 per 10 gm |
|
2.
|
Gold
in any form (other than those specified, against S. No. 1) |
Rs.
500 per 10 gm |
Rs.
750 per10 gm |
|
3.
|
Silver
in any form |
Rs.
1000 per Kg |
Rs.
1500 per Kg |
The
above rates would also apply to import of gold and silver including ornaments
(excluding ornaments studded with stones or pearls) are imported as personal
baggage by passengers coming to India. (Notifications No.172/1994-Customs,
dated the 30th September, 1994, No.31/2003-Customs, dated the 1st March, 2003
and No.62/2004-Customs, dated the 12th May, 2004 as amended vide Notification
No. 17/2010-Customs, dated 27.02.10 refers)
71.2. Customs duty on platinum is
being increased from “Rs.200 per 10 grams” to “Rs.300 per 10 grams” (S. No.189
of notification No. 21/2002- Customs, dated 01.03.2002 as substituted vide S. No. (v) of notification No.
21/2010-Customs, dated 27.02.2010 refers).
71.3 Basic customs duty on rhodium
is being reduced from 10% to 2% (S. No.189A of notification No. 21/2002-
Customs, dated 01.03.2002 as inserted vide S. No. (vi) of
notification No. 21/2010-Customs, dated 27.02.2010 refers).
No change
84.1 Concessional customs duty of 5%
on specified plantation machinery, which was available up to 6th July, 2010, is
being extended up to 31st March, 2011. (Clause (b) in the proviso to the
preamble of notification No. 21/2002-Customs as amended vide
notification No. 21/2010-Customs dated 27.2.2010 refers).
84.2 Full exemption from basic
customs duty is being provided to Geothermal ground source heat pumps with Nil special CVD. (S. No. 597 of notification No.
21/2002-Customs inserted vide notification No. 21/2010-Customs dated
27.2.2010 and S. No. 70 of notification No. 20/2006-Customs inserted vide notification
No. 24/2010-Customs dated 27.2.2010 refers).
84.3 Full exemption from basic
customs duty and CVD is being provided to tunnel boring machines used for
hydro-electric projects (S. No. 598 of notification No. 21/2002-Customs
inserted vide notification No. 21/2010-Customs dated 27.2.2010 refers).
84.4 Basic customs duty on specified
agricultural machinery is being reduced from 7.5% to 5%. (S. No. 599 of
notification No. 21/2002-Customs inserted vide
notification No. 21/2010-Customs dated 27.2.2010 refers).
84.5 Full exemption from basic
customs duty is being provided to truck refrigeration unit (S. No. 600 of
notification No. 21/2002-Customs inserted vide notification No.
21/2010-Customs dated 27.2.2010 refers).
84.6 Customs duty on all items of
machinery, including prime movers, instruments, apparatus and appliances,
control gear and transmission equipment and auxiliary equipment (including
those required for testing and quality control) and components, required for
initial setting up of a solar power generation project or facility is being
reduced to 5%. (Notification No. 30/2010-Customs dated 27.2.2010 refers).
84.7 Specified road construction
machinery items are presently fully exempt from customs duty subject to
specified conditions which restrict sale or disposal of such equipment for 5
years from the date of import. However, use of such equipment for similar road
projects for which the importer would be otherwise eligible for duty free
imports under the same notification is currently permissible. Amendments are
being made to permit sale or disposal of such machinery items at depreciated
value on payment of customs duties on depreciated value at the rates applicable
at the time of import subject to specified conditions. (Condition 40 in the
Annexure to the notification No. 21/2002-Customs amended vide as amended
vide notification No. 21/2010-Customs dated 27.2.2010 refers).
85.1 Full exemption from basic
customs duty and CVD presently available on parts, components and accessories
for manufacture of mobile handsets including cellular phones and their parts,
is being extended to parts, components for manufacture of battery chargers and
hands-free headphones of mobile handsets including cellular phones.
(Notification No. 23/2010-Customs dated 27.2.2010 refers).
85.2 Full exemption from basic
customs duty and CVD presently available on parts, components and accessories
for manufacture of mobile handsets including cellular phones and their parts,
valid up to 6th July, 2010 is now being extended to parts and components of
battery chargers and hands-free headphones of mobile handsets including
cellular phones. This exemption is valid up to 31st March, 2011. (Notification
No. 28/2010-Customs dated 27.2.2010 refers).
85.3 Exemption is being provided to
motion pictures, music, gaming software for use on gaming consoles, recorded on
media falling under heading 8523, from so much of the basic customs duty,
additional duty of customs leviable thereon under
sub-sections (1) and (5) of section 3 of the Customs Tariff Act, 1975 as is as
is in excess of the duties which would be leviable if
the value of the said goods, for the purposes of sub-section (1) of section 14
of the said Customs Act, were equal to the aggregate of cost of the carrier
medium and the freight and insurance charges incurred in respect of the carrier
medium. (Notification No. 27/2010-Customs dated 27.2.2010 refers). However, the
motion pictures, music, gaming software for use on gaming consoles imported in
pre-packaged form intended for retail sale will attract customs duty on the
value determined in terms of the provisions of the Customs Act, 1962.
85.4 Promotional material (like
Trailers, Making of Film etc.) imported in the form of Electronic Promotion
Kits (EPK)/ Beta Cams are being exempted from basic customs duty and CVD. (S.
No. 603 of notification No. 21/2002-Customs inserted vide
notification No. 21/2010-Customs dated 27.2.2010 refers).
85.5 Packaged software or canned
software, is at present exempted from so much of the CVD, as is equivalent to
the duty payable on the portion of the value of the packaged software
determined under section 14 of the Customs Act, or the rules made thereunder, read with sub-section (2) of section 3 of the
Customs Tariff Act, which represents the consideration paid or payable for
transfer of the right to use such goods provided that the said transfer of the
right to use shall be for commercial exploitation. The condition of commercial
exploitation is being removed. Consequently, the exemption would be available
on imported packaged software in all cases. (Notification 31/2010-Customs dated
27.2.2010 refers).
85.6 Basic customs duty on magnetrons
of up to 1000KW used for manufacture of domestic microwave ovens is being
reduced from 10% to 5%. (S. No. 601 of notification No. 21/2002-Customs
inserted vide notification No.
21/2010-Customs dated 27.2.2010 refers).
87.1. Certain specified goods for
use in manufacture of electrically operated vehicles are also being fully
exempted from basic customs duty and special additional duty of customs. Such
goods will, however, be subject to CVD at the rate of 4% at the time of import.
The same is subject to end use condition and is applicable till 31st March,
2013. (S. No.345A of notification No. 21/2002- Customs, dated 01.03.2002 as
inserted vide S. No. (xii) of notification No. 21/2010-Customs dated 27.2.2010; S.
No.9A of notification No. 20/2006- Customs, dated 01.03.2006 as inserted vide
S. No. (ii) of notification No. 24/2010-Customs,
dated 27.02.2010 refers)
90.1 Customs duty on all medical,
surgical, dental and veterinary equipments etc is being reduced from 7.5% to
5%. These goods are also being exempted from special CVD (S. No. 357A of
notification No. 21/2002-Customs inserted vide notification No.
21/2010-Customs dated 27.02.2010 and S. No. 71 of notification No.
20/2006-Customs inserted vide notification No. 24/2010-Customs dated
27.02.2010 refers).
90.2 Customs duty on all parts and
accessories of medical, surgical, dental and veterinary equipments etc is being
reduced from 7.5% to 5%. These goods are also being exempted from special CVD
(S. no. 357B of notification No. 21/2002-Customs inserted vide notification No.
21/2010-Customs dated 27.02.2010 and S. No. 72 of notification No.
20/2006-Customs inserted vide notification no. 24/2010-Customs dated
27.02.2010 refers).
90.3 Exemption from CVD on imports
of hospital equipment for use in specified hospitals and life saving equipment
is being withdrawn. These imports will now attract a CVD of 4%. However, (S. No
s 362 & 365 of notification No. 21/2002-Customs, amended vide notification
No. 21/2010-Customs dated 27.2.2010 refers).
90.4 Specified lists of medical
equipment and other goods, their parts, spares and accessories attracting
concessional customs duty are being omitted. (S. Nos. 363, 367 to 369 of
notification No. 21/2002-Customs omitted vide
notification No. 21/2010-Customs dated 27.2.2010 refers).
No change
98.1 Monorail projects for urban
public transport are being notified under project imports. These projects will
attract a customs duty of 5%. (S. No 38 of notification No. 42/96-Customs,
inserted vide notification No. 19/2010-Customs dated 27.2.2010 refers).
98.2 Setting up of digital headend is being notified under project imports. These
projects will attract a customs duty of 5% and nil special CVD. (S. No 39 of notification
No. 42/96-Customs inserted vide notification No. 19/2010-Customs dated
27.2.2010 and S. No 73 of notification No. 20/2006-Customs, inserted vide notification
No. 24/2010-Customs dated 27.2.2010 refers).
98.3 Installation of mechanized food
grain handling systems and pallet racking systems in mandis
and warehouses for food grains and sugar is being notified under project
imports. These projects will attract a basic customs duty of 5% + Nil CVD + Nil
special CVD. (S. No 40 of notification No. 42/96-Customs inserted vide notification
No. 19/2010-Customs dated 27.2.2010 and S. No 602 of notification No.
21/2002-Customs inserted vide notification No. 21/2010-Customs dated 27.2.2010
and S. No 74 of notification No. 20/2006-Customs, inserted vide notification
No. 24/2010-Customs dated 27.2.2010 refers).
98.4 Cold storage/cold room
(including for farm level pre-cooling) or industrial projects for preservation,
storage or processing of agricultural, apiary, horticultural, dairy, poultry,
aquatic & marine produce and meat is being notified under project imports.
These projects will attract a customs duty of 5%. (S. No 41 of notification No.
42/96-Customs, inserted vide notification No. 19/2010-Customs dated
27.2.2010 refers).
Goods imported in pre-packaged form
and intended for retail sale and certain specified goods namely, ready-made
garments, mobile phones and watches are being provided an outright exemption
from additional duty of customs of 4%. (Notification No. 29/2010-Customs dated
27.2.2010 refers). The existing exemption by way of refund would continue on
other items.
M.1 Section 127 of the Customs Act,
1962, dealing with Settlement Commission, is being amended so as to restore
certain provisions as they obtained prior to the enactment of the Finance Bill,
2007. Accordingly, the prohibition on filing of applications for the settlement
of cases where an assessee admits short-levy in
respect of goods for which no entry is being made under the provisions of the
Act (i.e. cases of mis-declaration, suppression etc.)
is being removed. Similarly, the restriction that an assessee
may seek only one-time settlement is also being relaxed. The Commission is
being empowered to extend the time limit of nine months for disposal of
applications by another three months, for reasons to be recorded in writing.
M.2 Section 3 of the Customs Tariff
Act is being amended to provide that the value of the imported goods for the
purpose of charging CVD in respect of goods chargeable to excise duty on the
basis of Maximum Retail Sale Price under Medicinal and Toilet Preparations
(Excise Duties) Act, 1955 shall be the retail sale price declared on such
imported goods less the amount of abatement, if any. This change will come into
effect on enactment of the Finance Bill.
M.3 Rule 2 (b) of the Customs Tariff
(Identification, Assessment and Collection of Anti-Dumping Duty on Dumped
Articles and for Determination of Injury) Rules, 1995 is amended to align the
same in line with the provisions of article 4.1(i) of
the WTO s Anti-Dumping Agreement (Notification No. 18/2010- Customs (N.T.)
dated 27.02.2010 refers).
M.4 The
import duty exemption provided for specified raw materials for use in electronics/IT
industry is being extended to some more items (S. No s 79, 225, 234 & 235
of notification No. 25/99-Customs as amended / inserted vide notification No.
20/2010-Customs dated 27.2.2010 refers). However, the exemption will be subject
to the existing specified conditions.
M.5 The
import duty exemption provided for specified capital goods for use in
electronics/IT industry is being extended to some more items (S. No s 2, 7, 11
& 41 of notification No. 25/2002-Customs as amended vide notification No.
22/2010-Customs dated 27.2.2010 refers). However, the exemption will be subject
to the existing specified conditions.
M.6 Customs duty on six more
specified items for use in manufacture of sports goods is being reduced to nil.
(S. No. 583 of notification No. 21/2002-Customs amended vide
notification No. 21/2010-Customs dated 27.2.2010 refers). However, the
exemption will be subject to the existing overall value limit of 3% and other
specified conditions.
M.7. Basic Customs duty is being
fully exempted on Special Grade Stainless Steel, Titanium Alloys, Cobalt-Chrome
Alloys and High-Density Polyethylene, used for the manufacture of Orthopedic implants (S.No. 142C of
the notification No. 21/2002-Customs, dated 01.03.2002 as inserted vide
Notification No. 21/2010- Customs dated 27.02.2010 refers).
M.8. The
current limit of Rs. 1 lakh per annum for duty free import of samples under
Notification No.154/1994-Customs, is being enhanced to Rs. 3 lakh per annum
(Notification No.154/1994-Customs, dated 13.7.1994 as amended vide Notification
No. 16/2010-Customs, dated 27.02.2010 refers).
EXPLANATORY NOTES (EXCISE)
Note: All changes come into effect
immediately unless otherwise specified.
Enhancement of Standard Rate: - The
standard rate of excise duty, which was reduced to 8% in February 2009 as a
part of the Stimulus package on non-petroleum products is now being enhanced
from 8% to 10% with a few exceptions. Consequent to the increase in the
standard rate, rates of excise duty on certain products like Cement, Large Cars
etc. are also being suitably enhanced. Chapter wise changes in excise duty
rates, other than enhancement of standard rate from 8% to 10%, are given below:
No change.
11.1 Excise duty exemption on
Tapioca Starch & Maize Starch is being withdrawn and these products will
now attract excise duty at 4%. (S.No. 3 of
Notification 3/2006-CE as amended by the notification 9/2010-CE dated
27.02.2010 refers)
11.2 Excise duty on potato starch is
being reduced from 8% to 4 %.( S.No. 3 of
Notification 3/2006-CE as amended by the notification 9/2010-CE dated
27.02.2010 refers)
No change.
21.1 Excise duty on Betel nut
product known as „Supari is being fully exempted from
excise duty. However, Scented Supari will continue to
attract duty at applicable rates. (S.No. 27Aof
Notification 3/2006-CE as amended by the notification 9/2010-CE dated
27.02.2010 refers)
21.2 Pan Masala
Packing Machines (Capacity Determination and Collection of Duty) Amendment
Rules, 2010 have been issued to amend Pan Masala
Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 to
effect certain technical changes in the said rules (Notification No.
8/2010-Central Excise (N.T.), dated 27.02.2010 refers).
No change.
24.1 The existing slab of filter
cigarettes of length not exceeding 70 mm is being broken up into two slabs: filter
cigarettes of length not exceeding 60 mm; and filter cigarettes of
length exceeding 60 mm but not exceeding 70 mm (Clause 74 of the Finance
Bill refers). Suitable rates are being prescribed for these slabs. The basic
excise duty (BED) on other cigarettes is also being revised. The revised rates
of excise duty including basic excise, additional excise and NCCD on cigarettes
are as under:
|
SNo. |
Description |
Present Rate |
Proposed Rate |
|
|
Non-filter length in mm |
(Rs. per 1000) |
|
|
1.
|
Not
exceeding 60 |
819
|
669
(509 BED+70 AED+90 NCCD) |
|
2.
|
Exceeding
60 but not exceeding 70 |
1323
|
1473(1218
BED+110 AED +145 NCCD) |
|
|
Filter length in mm |
|
|
|
3.
|
Not
exceeding 60 |
819
|
669
(509 BED+70 AED +90 NCCD) |
|
4.
|
Exceeding
60 but not exceeding 70 |
969 |
(809
BED+70 AED +90 NCCD) |
|
5.
|
Exceeding
70 but not exceeding 75 |
1323
|
1473(1218
BED+110 HC+145 NCCD) |
|
6.
|
Exceeding
75 but not exceeding 85 |
1759
|
1959(1624
BED+145 AED +190 NCCD) |
|
7.
|
Others
|
2163
|
2363(1948
BED+180 HC+235 NCCD) |
|
8.
|
Cigarettes
of tobacco substitutes |
1208
|
1408(1258
BED +150 NCCD) |
Note: BED, AED and NCCD stands for
Basic Excise Duty, Additional Excise Duty and National Calamity Contingent Duty
respectively.
Effective rate of basic excise duty
for cigarettes (both filter and non-filter) of length not exceeding 60
millimeters is being prescribed separately. (Notification No. 18/2010-Central
Excise dated 27.02.2010 refers)
24.2 At present, cigars, cheroots
and cigarillos of tobacco attract ad valorem rate of basic excise duty (BED) of
8% plus health cess of 1.6%. These rates are now being replaced with a
composite rate of “10% or Rs.1227 per thousand, whichever is higher” (BED) and
“1.6% or Rs.246 per thousand whichever is higher” (AED). Cigars, cheroots and
cigarillos of tobacco substitutes will now attract BED of “10% or Rs.1473/1000”
whichever is higher
24.3 Basic excise duty on branded
unmanufactured tobacco and tobacco refuse is being increased from 42% to 50%.
24.4 Basic excise duty on chewing
tobacco, preparations containing chewing tobacco, zarda,
scented tobacco, snuff and its preparations, tobacco extracts and essences etc.
is being increased from 50% to 60%. The rates of abatement of the commodities
are also being accordingly revised. (Notification No. 9/2010-Central Excise
(N.T.) dated 27.02.2010 refers).
24.5 Basic excise duty on branded
homogenized or reconstituted tobacco is being increased from 50% to 60%.
24.6 Basic excise duty on items of
other smoking tobacco (branded) is being increased from 34% to 40%.
24.7 Basic excise duty on smoking
mixtures of pipes and cigarettes is being increased from 300% to 360%.
24.8 Basic excise duty on cut
tobacco is being increased from Rs.50 per kg. to Rs.60
per kg.
24.9 Basic excise duty on
manufactured tobacco other than chewing tobacco, preparations containing
chewing tobacco, zarda scented tobacco, snuff and its
preparations, tobacco extracts and essences etc and is being increased from 50%
to 60%.
(Clause 74 of the Finance Bill 2010
refers for changes in 24.1 to 24.9 above)
24.10 The duty on other Pan Masala is being increased from 8% to 10%. (Entry no. 29A of
Notification no. 3/2006-Central Excise as amended by Notification no. 9/2010-
Central Excise dated 27.02.2010 refers).
24.11 Basic excise duty on branded
„hookah or „gudaku tobacco is being increased from 8%
to 10%. (Entry no. 33 of Notification no. 3/2006- Central Excise as amended by
Notification no. 9/2010- Central Excise dated 27.02.2010 refers).
24.12 The duty on other smoking
tobacco (unbranded) is being increased from 8% to 10%. (Entry no. 35 of
Notification no. 3/2006- Central Excise as amended by Notification no. 9/2010-
Central Excise dated 27.02.2010 refers).
24.13 The duty on other manufactured
tobacco and manufactured tobacco substitutes (unbranded) is being increased
from 8% to 10%. (Entry no. 40 of Notification no. 3/2006- Central Excise as
amended by Notification no. 9/2010- Central Excise dated 27.02.2010 refers)
24.14 The AED on cigars, cheroots
and cigarillos of tobacco is being revised from 1.6% to “1.6% or Rs.246 per
thousand whichever is higher” (Entry no. 4&5 of Notification no. 6/2005-
Central Excise as amended by Notification no. 8/2010- Central Excise dated
27.02.2010 refers)
24.15 Unmanufactured tobacco,
bearing a brand name, falling under tariff heading 2401 of the Excise Tariff
and chewing tobacco falling under tariff item 2403 99 10 of the said Tariff,
manufactured with the aid of packing machine and packed in pouches have been
declared as “notified goods” under Section 3A of the Central Excise Act, and,
accordingly, these shall be levied to duty of excise in accordance with the
provisions of the section 3A (Notification No. 10/2010-Central Excise (N.T.),
dated 27.02.2010 refers). The rate of duty to be levied on these goods under Section
3A per machine per month for different denomination of Retail Sale Price (RSP)
of poucheshas been specified in notification No.
16/2010-Central Excise, dated 27.02.2010. Further, Chewing Tobacco and
Unmanufactured Tobacco Packing Machines (Capacity Determination and Collection
of Duty) Rules, 2010 are also being issued for administration of the new levy.
This new levy shall be effective from 08.03.2010. (Notification No.
11/2010-Central Excise (N.T.) dated 27.02.2010 refers).
24.16 Pan Masala
Packing Machines (Capacity Determination and Collection of Duty) Amendment
Rules, 2010 have been issued to amend Pan Masala
Packing Machines (Capacity Determination and Collection of Duty) Rules, 2008 to
effect certain technical changes in the said rules (Notification No.
8/2010-Central Excise (N.T.), dated 27.02.2010 refers).
25.1 Consequent to enhancement in
the standard rate of duty from 8% to 10%, the specific rates of duty on cement
and cement clinker is also being revised upwards as follows:
Mini
cement plant:
|
|
Cement |
Present rate |
Proposed rate |
|
1. |
Cleared
in packaged form,- |
|
|
|
|
(i) of retail sale price not exceeding Rs. 190 per 50 kg
bag or of per tonne equivalent retail sale price not exceeding Rs. 3800; |
Rs.145
per tonne |
Rs.185
per tonne |
|
|
(ii)
of retail sale price exceeding Rs. 190 per 50 kg bag or of per tonne
equivalent retail sale price exceeding Rs. 3800; |
Rs.
250 per tonne |
Rs.315
per tonne |
|
2. |
Cleared
other than in packaged form |
Rs.
170 per tonne |
Rs.215
per tonne |
Other
than mini cement plant:
|
|
Cement |
Present rate |
Proposed rate |
|
|
1.
|
Cleared
in packaged form,- |
|
|
|
|
|
(i) of retail sale price not exceeding Rs. 190 per 50 kg
bag or of per tonne equivalent retail sale price not exceeding Rs. 3800; |
Rs.
230 per tonne |
Rs.290
per tonne |
|
|
|
(ii)
of retail sale price exceeding Rs. 190 per 50 kg bag of per tonne equivalent
retail sale price exceeding Rs. 3800 |
8%
of retail sale price |
10%
of retail sale price |
|
|
2. |
Cleared
other than in packaged form |
8%
or Rs. 230 per tonne, whichever is higher |
10%
or Rs.290 per tonne whichever is higher |
|
|
|
Cement
clinker |
Rs.300
per tonne |
Rs.
375 per tonne |
|
(S.No. (i) to (v) of notification No. 10/2010- Central Excise dated
27.02.2010 refers).
No change.
27.1 A new cess to be called „Clean
Energy Cess is being imposed on Coal, Lignite and peat (CETH 2701, 2702, &
2703) produced in India. This will come into force from the date to be notified
after the enactment of the Finance Bill, 2010. (Clause 82 & 83 of the
Finance Bill, 2010 read with the Tenth schedule refers)
27.2 Excise exemption on Avgas is
being withdrawn and 4% excise duty is being imposed on it. (S.No.16 of the
Notification No. 4/2006-CE dated the 1st March 2006 as amended vide
notification no. 10/2010- Central Excise dated 27.02.2010 refers).
27.3 The rates of excise duty on
Motor Spirit (commonly known as petrol) and HSD (diesel) are being increased by
Re.1 per litre. The revised rates of duty on these
items are as under:
|
Description
|
Intended
for sale without Brand Name |
Intended
for sale with Brand Name |
|
Motor
Spirit |
*Rs.14.35
per litre |
*Rs.15.50
per litre |
|
HSD
|
**Rs.4.60
per litre |
**Rs.5.75
per litre |
Note: *Includes Rs.2 additional
excise duty and Rs.6 special additional excise duty. ** Includes Rs.2
additional excise duty.
(S.No.17
& 19 of the Notification No. 4/2006-CE dated the 1st March 2006 as amended
vide notification No. 10/2010- Central Excise dated 27.02.2010 refers).
27.4 Sub-heading 2712 20, tariff
items 2712 20 10 and 2712 20 90 have been substituted by tariff item „2712 20 00
covering the item „Paraffin wax containing by weight less than 0.75% of oil . Tariff item „2712 90 40 is being inserted to cover
„Paraffin wax containing by weight 0.75% of oil or more. There is no change in
the duty structure.
No change.
33.1 Excise duty is being exempted
on security ink manufactured by Bank Note Press, Dewas
(Madhya Pradesh) and supplied to Bank Note Press, Dewas,
Currency Note Press, Nashik, India Security Press, Nashik, Security Printing Press, Hyderabad, Bhartiya Reserve Bank Note Mudran
Limited, Mysore and Bhartiya Reserve Bank Note Mudran Limited, Salbony. (S.No. (xvii) of notification No. 10/2010- Central Excise
dated 27.02.2010 refers).
33.2 Excise duty is being exempted
on Fractionated/ De-terpenated Mentha
oil (DTMO), De-mentholised Oil (DMO), Spearmint oil, Mentha Piperita oil and any other
by products/ intermediate arising in the course of manufacture of Menthol (S.No. (xviii) Of notification No. 10/2010- Central Excise
dated 27.02.2010 refers).
No change.
40.1 Excise duty on latex rubber
thread of tariff item 4007 00 10 is being reduced from 8% to 4% (S.No. 82 of the notification No. 4/2006-Central Excise as
amended vide notification No. 10/2010-Central Excise dated 27.02.2010 refers).
40.2 Excise duty on Toy Rubber
Balloons of Natural Rubber Latex falling under heading 40 is being reduced from
8% to Nil (S.No. 85A of the notification No.
4/2006-Central Excise as inserted vide Notification No. 10/2010- Central Excise
dated 27.02.2010 refers).
No change.
48.1 Excise duty at 10% is being
imposed on Baby and clinical diapers, which were fully exempt so far. (Relevant
bill entries read with S.No. 96B of the notification
No. 4/2006-Central Excise as inserted vide Notification No. 10/2010- Central
Excise dated 27.02.2010 refers).
48.2 Excise duty exemption on
Sanitary napkins is also being withdrawn and these goods will now attract
standard rate of duty at 10% (Relevant bill entries read with S.No. 96C of the notification No. 4/2006-Central Excise as
inserted vide Notification No. 10/2010- Central Excise dated 27.02.2010
refers).
48.3 Excise duty on Cartons, boxes
and cases, of corrugated paper or paperboard manufactured by Standalone manufacturers
is being reduced from 8% to 4% (S.No. 96E of the
notification No. 4/2006-Central Excise as inserted vide Notification No. vide
notification No. 10/2010-Central Excise dated 27.02.2010 refers).
No change.
63.1 Excise duty exemption on
Mosquito nets impregnated with insecticide is being withdrawn and duty @ 4% is
being imposed (S. No.3 of notification No. 5/2006- Central Excise, dated
01.03.2006 as amended vide S. No. (iv) of notification
No. 11/2010-Central Excise, dated 27.02.2010 refers).
63.2 Excise duty exemption on
umbrella panels is being withdrawn and duty @ 4% is being imposed. (S. No.79 of
notification No. 3/2005- Central Excise, dated 24.02.2005 omitted vide notification No. 7/2010-Central Excise, dated 27.02.2010
refers).
No change.
66.1. Excise duty on all parts of
umbrellas and sun umbrellas including umbrella panels, irrespective of their
classification in the Excise Tariff, is being unified at 4% (S. No.5C of
notification No. 5/2006- Central Excise, dated 01.03.2006 as inserted vide S.
No. (v) of notification No. 11/2010-Central Excise, dated 27.02.2010 refers; S.
No.79 of notification No. 3/2005- Central Excise, dated 24.02.2005 is being
omitted notification No. 7/2010-Central Excise, dated 27.02.2010).
No change.
68.1. A Chapter Note is being
inserted in Chapter 68 to the effect that in relation to products of headings
6802 and 6810, the process of cutting or sawing or sizing or polishing of stone
blocks or any other process, for converting of blocks into slabs or tiles,
shall amount to “manufacture” (clause 73 of Finance Bill, 2010 refers).
Accordingly, the slabs or tiles classifiable under CETH 6802 or 6810
manufactured out of blocks of natural stone or agglomerated artificial are now
excisable. However, marble slabs and tiles classifiable under chapter 25 and
marble tiles falling under chapter 68 attract the same specific rate of Rs. 30
per square metre (S. No. 2 of Notification
4/2006-C.E., dated 1st March 2006 refers) and as such finishing processes like
cutting, sawing, polishing etc. on duty paid slabs or tiles of marble will (if
not resulting in change of classification) not attract any further excise duty.
69.1. S. No. 13 of notification No.
5/2006- Central Excise, dated 01.03.2006 prescribing concessional excise duty
rate of 8% on ceramic tiles, manufactured in a factory not using electricity
for firing the kiln, is being omitted. Consequently, all ceramic tiles, whether
manufactured by using electricity for firing the kiln or not, will attract a
single excise duty rate of 10% with cenvat credit.
(S. No.13 of notification No. 5/2006- Central Excise, dated 01.03.2006 as
omitted vide S. No. (vii) of
notification No. 11/2010-Central Excise, dated 27.02.2010 refers)
70.1. S. No. 20 of notification No.
5/2006- Central Excise, dated 01.03.2006 prescribing concessional excise duty
rate of 4% on rough ophthalmic blanks, for manufacture of optical lenses is
being omitted as such blanks already attract a „nil excise duty vide S. No.10
of notification No. 10/2006-Central Excise, dated 01.03.2006 (S. No.20 of
notification No. 5/2006- Central Excise, dated 01.03.2006 as omitted vide S.
No. (xi) of notification No. 11/2010-Central Excise,
dated 27.02.2010 refers)
71.1. Gold bars, other than tola bars, manufactured in a factory starting from the
stage of gold ore or concentrate and bearing manufacturer s engraved serial
number & weight expressed in metric units, will be levied excise duty at
the rate of Rs.280 per 10gm, with full Cenvat credit
facility. Primary gold including in bar form manufactured or refined with the
aid of power from any form of gold shall continue to be exempt. (S. No.21A of
notification No. 5/2006- Central Excise, dated 01.03.2006 as inserted vide S. No. (xii) of notification
No. 11/2010-Central Excise, dated 27.02.2010 refers).
71.2. Excise duty rates applicable
to the DTA (Domestic Tariff Area) clearances of plain gold and silver jewellery manufactured by an EOU (Export Oriented Unit)
have been increased, in case of gold jewellery, from
Rs.500 per 10gm to Rs.750 per 10gm, and in case of silver jewellery,
from Rs.1000 per Kg to Rs.1500 per Kg (S. No.8 and 10 of notification No.
23/2003- Central Excise, dated 31.03.2003 as substituted vide S. No. (iv) & (v) of notification No. 5/2010-Central Excise,
dated 27.02.2010, respectively, refers).
71.3 Excise duty is being exempted
on Circulation Coins, Blanks, Weights & Measures Standards and scrap
generated in manufacture of Blanks by IGM Mumbai, IGM Kolkata, IGM Hyderabad
and IGM Noida (Notification No. 3 /2010- Central
Excise dated 27.02.2010 refers).
No change.
73.1 Excise duty on Open Top
Sanitary (OTS) Cans is being increased from 4% to 10% (S.No.
31A of the notification No. 5/2006-Central Excise as amended vide notification
No.11 /2010-Central Excise dated 27.02.2010 refers).
No change.
76.1 Chapter Note 2 is being
inserted in Chapter 76 to declare the process of drawing or redrawing of aluminium tubes and pipes as amounting to “ manufacture”
(clause 73 of Finance Bill, 2010 refers).
No change.
84.1 Nil duty of excise on specified
plantation machinery, which was valid up to 1.5.09, is being reintroduced from
27.2.10 up to 31.3.11. (Proviso in the preamble of the notification No.
06/2006-CE as substituted by notification No. 12/2010-CE dated 27.02.2010
refers.)
84.2 Excise duty exemption on
specified items intended to be used for the installation of a cold storage,
cold room or refrigerated vehicle, for the preservation, storage, transport of
agricultural produce is being extended to other sectors like apiary,
horticulture, dairy, poultry, aquatic and marine produce and meat and their
processing. (S. No. 5 of notification No. 6/2006-CE amended vide notification
No. 5/2010-CE dated 27.02.2010 refers).
84.3 Excise duty on replaceable kits
of all domestic water filters except those operating on reverse osmosis
technology is being reduced from 8% to 4% (S. No. 8C of notification No.
6/2006-CE substituted vide notification No. 12/2010-CE dated 27.02.2010
refers).
85.1 An excise duty @ 4% is being
imposed on specified IT products like microprocessor other than motherboards,
floppy disc drives, CD-Rom drive etc when these items are meant for external
use with a computer or laptop as a plug-in device. However, these items meant
primarily for use inside the CPU housing/laptop body would continue to be
exempt from excise duty. (S. No. 17 of notification No. 6/2006-CE substituted
vide notification No. 12/2010-CE dated 27.02.2010 refers).
85.2 Excise duty exemption on parts,
components and accessories of mobile handsets including cellular phones is being
extended to parts of two accessories namely, battery chargers and hands-free
headphones of these devices. (S. No. 31 of notification No. 6/2006-CE amended
vide notification No. 12/2010-CE dated 27.02.2010 refers).
85.3 Packaged software or canned software,
is at present exempted from so much of the excise duty, as is equivalent to the
duty payable on the portion of the value of Packaged software determined under
section 4 of the Central Excise Act, or the rules made thereunder,
which represents the consideration paid or payable for transfer of the right to
use such goods provided that the transfer of the right to use shall be for
commercial exploitation. The condition of commercial exploitation is being
removed. Consequently, the exemption would be available on packaged software in
all cases. (Notification 17/2010-Central Excise dated 27.02.2010 refers).
85.4 Excise duty exemption is being
provided on goods supplied to mega power projects from which supply of power
has been tied up through tariff based competitive bidding or a mega power
project awarded to a developer on the basis of such bidding subject to
specified conditions. (S. No. 91B of notification No. 6/2006-CE inserted vide
notification No. 12/2010-CE dated 27.02.2010 refers).
85.5 Excise duty exemption on
specified list of goods used for the manufacture of rotor blades for wind
operated electricity generators is being extended to some items. (List 6 of
notification No. 6/2006-CE amended vide notification No. 12/2010-CE dated
27.02.2010 refers).
85.6 Excise duty exemption is being
provided on specified goods required for initial setting up of solar power
generation project or facility. (Notification No. 15/2010-CE dated 27.02.2010
refers).
No change.
87.1. Excise duty at the rate of 4%
is being imposed on all electrically operated vehicles, including two and three
wheeled electric motor vehicles and battery operated cars. The concessional
rate of 4% would apply to all electric vehicles including electric motor-assisted
cycle rickshaw even if the batteries for such vehicles are recharged using
solar power (S. No.35 of notification No. 6/2006- Central Excise, dated
01.03.2006 as substituted vide S. No. (xiv) of
notification No. 12/2010-Central Excise, dated 27.02.2010 dated 27.02.2010
refers).
87.2. The following parts,
irrespective of their classification in the Excise Tariff, for use in
manufacture of an electrically operated vehicle shall attract a excise duty of
4% on end-use basis, namely:- (i) Battery Pack (ii)
Battery Charger (iii) AC or DC Motor (iv) AC or DC Motor Controller. The
concessional duty rate of 4% shall remain in force till 31st March, 2013.
Consequent to this, the full excise duty exemption available to specified parts
of battery operated cars is being withdrawn (S. No.35A of notification No.
6/2006- Central Excise, dated 01.03.2006 as inserted vide S. No. (xv) of notification No. 12/2010-Central Excise, dated 27.02.2010
refers; S. No.35B of notification No. 6/2006- Central Excise, dated 01.03.2006
omitted vide S. No.(xvi) of notification No. 12/2010-Central Excise, dated
27.02.2010 refers).
87.3. Ad-valorem component of excise
duty on large cars, SUVs, etc. and their chassis is being increased from 20% to
22%. There is no change in the specific component of Rs. 15000 and the same
will continue to be levied as applicable. (S. No.41 & 41A of notification
No. 6/2006- Central Excise, dated 01.03.2006 as substituted vide
S. No. (xix) & (xx) of notification No. 12/2010-Central Excise, dated
27.02.2010 refers).
87.4. Excise duty on self-loading or
self-unloading trailers and semi-trailers for agricultural purposes (Tariff
Item 8716 20 00) is being fully exempted (S. No.53A of notification No. 6/2006-
Central Excise, dated 01.03.2006 as inserted vide S. No. (xxxiii) of notification No. 12/2010-Central Excise, dated 27.02.2010
refers).
87.5. “Parts, components and
assemblies of automobiles”, falling under any chapter, are notified for
assessment of duty with reference to their retail sale price under Section 4A
of the Central Excise Act, 1944, vide S. No.108 of notification No.49/2008-CE
(N.T.), dated 24.12.08. The current entry against S. No. 108 is now being
substituted with “Parts, components and assemblies of vehicles (including
chassis fitted with engines) falling under Chapter 87 excluding vehicles
falling under headings 8712, 8713, 8715 and 8716”. (S. No.108 of
notification No. 49/2008-CE (N.T.), dated 24.12.08 as substituted vide S. No. (iii) of notification
No. 9/2010-Central Excise (N.T.), dated 27.02.2010 refers).
No change.
90.1 Excise duty of 10% is being
imposed on goggles other than those used for correcting vision. (S. No. 27 of
notification No. 10/2006-CE amended vide notification No. 13/2010-CE dated
27.02.2010 and S. No. 57 of 9
notification No. 6/2006-CE amended vide
notification No. 12/2010-CE dated 27.02.2010 refers). Sunglasses or Goggles
meant for correcting vision will continue to attract 4% concessional duty while
spectacles continue to be exempt.
90.2 Specified list of medical
equipment and other goods, and their parts and accessories attracting
concessional 4% / nil excise duty respectively is being omitted. (S. No. 26 of
notification No. 10/2006-CE omitted vide notification No. 13/2010-CE dated
27.02.2010 and S. No. 60 of notification No. 6/2006-CE omitted vide
notification No. 12/2010-CE dated 27.02.2010 refers).
90.3 Specified list of medical
equipment and other goods, and their parts and accessories attracting nil
excise duty is being omitted. (S. No. 61, S. No. 62 to S. No. 64 of
notification No. 6/2006-CE omitted vide notification No. 12/2010-CE dated
27.02.2010 refers).
90.4 An excise duty @ 4% is being
imposed on blood glucose monitoring system (Glucometer)
and test strips. (S. No. 65 of notification No. 6/2006-CE amended vide
notification No. 12/2010-CE dated 27.02.2010 refers).
90.5 An excise duty @ 4% is being
imposed on patent ductus arteriosus/
atrial septal defect
occlusion devices. (S. No. 68A of notification No. 6/2006-CE amended vide notification
No. 12/2010-CE dated 27.02.2010 refers).
No change.
94.1 Excise duty on products wholly
made of quilted textile materials falling under heading 9404 of the first
schedule of the Central Excise Tariff Act, 1985 is being exempted. (S. No. 71A
of notification No. 6/2006-CE inserted vide notification No. 12/2010-CE dated
27.02.2010 refers).
94.2 Excise duty on LED lights/
lighting fixtures falling under heading 9406 of the first schedule of the
Central Excise Tariff Act, 1985 is being reduced from 8% to 4%. (S. No. 71B of
notification No. 6/2006-CE inserted vide notification No. 12/2010-CE dated
27.02.2010 refers).