Customs Act, 1962 Section 20 — Re-importation of goods
Customs Act, 1962 · Re-importation of goods
Plain-English Explanation
Overview
Section 20 of the Customs Act, 1962, addresses the re-importation of goods into India. It essentially states that goods initially exported from India and later re-imported are generally treated as regular imports, subject to applicable duties and restrictions. This aims to prevent misuse and ensure a level playing field.
Who Does This Apply To?
This section applies to any person or business that exports goods from India and subsequently re-imports the same goods, or goods of a similar kind and value. This includes manufacturers, traders, exporters, and individuals. It also indirectly affects Customs officers tasked with assessing and collecting duties on such re-imports.
How It Works
Here's a step-by-step breakdown of how Section 20 functions:
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Export of Goods: Goods are initially exported from India following all relevant procedures and regulations.
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Re-importation: The same goods, or goods of a similar kind and value, are later imported back into India.
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Duty Liability: Upon re-importation, these goods become liable to customs duties. The duty rate will be the same as if identical or similar goods were being imported into India for the first time.
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Applicability of Conditions and Restrictions: Any conditions or restrictions that apply to the import of goods of that kind and value at the time of re-importation will also apply to the re-imported goods. This could include import licenses, specific standards, or quarantine requirements.
Important Conditions & Exceptions
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Condition 1: The goods must be the same goods that were previously exported, or goods of a similar kind and value. Significant alterations or processing abroad could potentially alter the duty liability.
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Condition 2: The section applies regardless of the reason for re-importation. It could be for repair, further processing, or simply because the goods could not be sold in the foreign market.
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Exception: Certain exemptions or concessions may be available depending on the specific circumstances of the re-importation. For example, goods re-imported after being sent abroad for repairs may be subject to reduced duty rates, subject to conditions notified by the government. Specific notifications need to be examined for applicability.
Practical Example
XYZ Garments exports a batch of shirts to the USA. Due to a change in market trends, a portion of the shirts (valued at INR 5,00,000) cannot be sold and is re-imported into India. Upon re-importation, XYZ Garments is liable to pay applicable customs duties on the shirts. If the Basic Customs Duty (BCD) rate for shirts is 10%, then XYZ Garments must pay INR 50,000 as BCD. IGST and other applicable taxes may also be levied. In addition, any import restrictions (e.g., textile regulations) applicable to shirt imports would also apply to this re-importation.
Key Amendments
No major amendments since enactment.
No case laws found for this provision yet.
Browse all case laws →Frequently Asked Questions
What does Section 20 of the Customs Act, 1962, cover concerning re-importation of goods?
Section 20 of the Customs Act, 1962 stipulates that goods re-imported into India after being exported are subject to import duties and all applicable conditions and restrictions. This means the goods will be treated as if they were being imported for the first time, regardless of their previous export status. The duties and restrictions will be equivalent to those applied to goods of similar kind and value at the time of re-importation.
Are there any specific conditions or restrictions that apply to goods re-imported under Section 20 of the Customs Act, 1962?
Yes, re-imported goods under Section 20 are subject to the same conditions and restrictions as newly imported goods of the same kind and value. These may include import licenses, compliance with specific standards, and other regulatory requirements in force at the time of re-importation. Exporters should check current regulations before re-importing to ensure full compliance.
Is there any time limit within which goods must be re-imported to be subject to Section 20 of the Customs Act, 1962?
Section 20 itself doesn't specify a time limit for re-importation. As long as the goods are imported back into India after having been exported, the section applies. However, specific notifications or regulations related to particular goods might prescribe time limits for claiming certain exemptions or benefits related to the initial export, which could indirectly affect the re-importation process.
Are there any exemptions from duty applicable on re-imported goods under Section 20 of the Customs Act, 1962?
While Section 20 generally subjects re-imported goods to import duties, specific exemptions may be available under other provisions of the Customs Act or related notifications. These exemptions often apply to goods re-imported for repair, further processing, or as part of specific government schemes like duty drawback or advance authorization. Check relevant notifications for applicable exemptions at the time of re-import.
What happens if I fail to comply with the conditions and restrictions applicable to re-imported goods under Section 20 of the Customs Act, 1962?
Failure to comply with the conditions and restrictions under Section 20 can result in penalties, including fines and seizure of the goods. Additionally, you may be required to pay the full import duty along with applicable interest and penalties. It is vital to ensure accurate documentation and compliance with all relevant regulations to avoid these consequences; consider seeking professional advice before re-importing.
How does Section 20 of the Customs Act, 1962 interact with the Duty Drawback scheme for exported goods?
Section 20 requires duties on re-imported goods. If you claimed Duty Drawback on the initial export, re-importing those goods generally requires you to repay the drawback amount received plus interest, as per the relevant Duty Drawback rules. The repayment ensures that you don't benefit from both the drawback on export and the absence of duty on re-import; refer to the Duty Drawback rules for specific repayment procedures and rates.
Does Section 20 of the Customs Act, 1962 apply to goods that were exported temporarily for exhibitions or trade fairs?
Yes, Section 20 applies to goods temporarily exported for exhibitions or trade fairs and then re-imported. However, customs regulations often provide for specific procedures and exemptions for such temporary exports and re-imports to simplify the process and avoid unnecessary duty burdens, provided all relevant conditions are met. Check for specific notifications and circulars related to temporary export/re-import for exhibitions to understand the detailed requirements.
Key Conditions & Requirements
| Condition | Details |
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| Liability to Duty | Re-imported goods are subject to import duties as if they were being imported for the first time. |
| Applicable Conditions and Restrictions | Re-imported goods are subject to all conditions and restrictions applicable to similar goods of the same kind and value upon importation. |
| No Specific Exemptions Mentioned | The section does not explicitly provide any specific exemptions from duty or restrictions for re-imported goods. |
| Similarity in Kind and Value | The applicable duties, conditions, and restrictions are determined based on goods of similar kind and value. |
| Implicit Requirement of Prior Exportation | The goods must have been exported from India before being re-imported to be subject to Section 20. |
| Broad Applicability | Section 20 applies broadly to all goods re-imported after exportation, without specific exclusions based on purpose or use. |
Amendment History
Substituted by Act 32 of 1994, section 60(i) for section 20(w.e.f. 13-5-1994). Earlier section 20 was amended by Act 14 of 1982, section 45(w.e.f. 11-5-1982). And by Act 80 of 1985, section 2(w.e.f. 27-12-1985).
Provisos and Explanations omitted by Act 22 of 1995, Section 53(w.e.f.26.05.1995)