The government has exempted the Customs duty on import of personal protection equipment (PPE), ventilators, Covid-19 testing kits, and inputs required for making them. It has also allowed export of certain active pharmaceutical ingredients (API) and formulations made from them that were restricted earlier. Useful procedural relaxations have been made and some helpful clarifications issued.
On March 3, the government restricted export of 13 API and formulations made from them. On April 6, it removed that restriction on all of them except paracetamol and its formulations, which can, however, be exported by Export Oriented Units (EOUs), units in Special Economic Zones (SEZs) and by other units only in discharge of export obligation against advance authorisations. Export of ventilators, sanitizers, and masks remain prohibited.
Export of hydroxychloroquine and its formulations were prohibited on March 25. Their exports by EOU, SEZ
units and by others in discharge of export obligation were allowed but that relaxation was withdrawn on April 4. Later, there have been reports that the government has decided to allow exports of hydroxychloroquine and its formulations but till Friday morning, the Commerce Ministry had not issued any notification lifting the ban.
The Central Board of Indirect Taxes and Customs (CBIC) has allowed clearance of goods without furnishing bond under provisional assessment, for deposit in bonded warehouses, for availing exemptions under notifications issued under Section 25 of the Customs Act, 1962 or for any other purpose under Section 143 of the said Act and for bond-to-bond transfer of warehoused goods. Considering the difficulty in getting stamp paper, the importers may furnish only a letter of undertaking on their letterhead in lieu of the bond. This facility is available till the end of April for importers mentioned in the April 3 CBIC
circular. Request from others will be considered on merits. The CBIC
has also deferred implementation of its instructions on electronic sealing for deposit and removal of goods from bonded warehouses.
The goods and services tax (GST) wing of the CBIC
has also issued useful clarifications in respect of time period for filing appeals, issues relating to companies under Insolvency and Bankruptcy Code, some refund related issues and various measures announced by the government for providing relief to the taxpayers in view of spread of Covid-19.
The Director General of Foreign Trade (DGFT) has deferred the implementation of the trace and track system for export of drug formulations along with maintaining parent-child relationship in packaging and their movement in supply chain. The DGFT has also extended the date for seeking one-time condonation of delay under EPCG scheme for certain purposes. Trade notices have been issued for electronic filing and issuance of certificates of origin under various trade agreements, retrospective issue of certificates of origin, acceptance of scan copies of documents for such purposes and so on.
Thus, the government is trying to identify areas where relief by way of simplifying procedures or extending the deadlines can be provided. Yet, there are some issues. For example, expiry dates for goods stored in bonded warehouses need to be extended. The dates when they start attracting interest need to be revised. Input tax credit must be permitted even if the recipient does not pay within six months, and so on. The trade must highlight such issues to help the government grant necessary relief.