Exemption from Custom duty

We know that rates of duty are mentioned in Customs Tariff Act.

However, Central Government has the power to grant exemption by passing notification in official gazette.

Such notification passed in official gazette granting exemption is called exemption notification.

Types of exemptions

General Exemption

If the Central Government is satisfied

that it is necessary in the public interest so to do,

it may, by notification in the Official Gazette,

exempt generally either absolutely or subject to such conditions (to be fulfilled before or after clearance)

as may be specified in the notification,

goods of any specified description from the whole or any part of duty of customs leviable thereon

Special Exemption

If the Central Government is satisfied

that it is necessary in the public interest so to do,

it may, by special order in each case,

exempt from payment of duty, any goods on which duty is leviable only under circumstances of an exceptional nature to be stated in such order.

Further, no duty shall be collected if the amount of duty leviable is equal to, or less than, ` 100.

Difference between General Exemption and Special Exemption?

Why are Exemptions Granted?

To control economy and promoting industrial growth of company

Sometimes exemption is granted on moral grounds like

• When goods get damaged
• Goods reach the Indian soil but not suitable for consumption