Unit - 5

Unit - 5
Explain the various powers of Commissioner to search and arrest of suspected persons
under the Customs Act, 1962.

POWER TO SEARCH SUSPECTED PERSONS ENTERING OR LEAVING INDIA, ETC. (Sec. 100)
1. If the proper officer has reason to believe that any person has secreted about his person, any
goods liable to confiscation or any related documents, he may search that person.
2. This section applies to the following persons, namely:
a. any person who has landed from or is about to board, or is on board any vessel within the
Indian customs waters;
b. any person who has landed from or is about to board, or is on board a foreign-going
aircraft;
c. any person who has got out of, or is about to get into, or is in, a vehicle, which has arrived
from, or is to proceed to any place outside India;
d. any person not included in the above categories, who has entered or is about to leave
India;
e. any person in a customs area.

POWER TO SEARCH SUSPECTED PERSONS IN CERTAIN OTHER CASES (Sec. 101):

If an officer of customs empowered by the Commissioner of Customs, has reason to believe that
any person has secreted about his person, any goods which are liable to confiscation, or related
documents, he may search
that person.
2. The goods referred to above are the following:
a. gold;
b. diamonds;
c. manufactures of gold or diamonds;
d. watches;
e. any other class of goods which the Central Government may specify.

PERSONS TO BE SEARCHED MAY REQUIRE TO BE TAKEN BEFORE GAZETTED OFFICER OF

CUSTOMS OR MAGISTRATE.(Sec. 102):
1. When any officer of customs is about to search any person, the officer
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person so requires, takes him without unnecessary delay to the nearest gazetted officer of
customs or magistrate.
2. If such requisition is made, the officer of customs may detain the person making it until he
can bring him before the gazetted officer of customs or the magistrate.
3. The gazetted officer of customs or the magistrate before whom any such person is brought,
if he sees no reasonable ground for search, forthwith discharges the Person, but otherwise
directs that search be made.
4. Before making a search, the officer of customs calls upon two or more persons to attend
and witness the Search and may issue an order in writing to them so to do. The search is
made in the presence of such persons and a list of all things seized in the course of such
search is prepared by such officer and signed by such witness.
5. No female can be searched by any one excepting a female.
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 POWER TO ARREST(Sec. 104):
If an officer of customs empowered by the Commissioner of Customs has reason to believe that
any person in India or within the Indian customs waters has committed an offence punishable
under section 132 or section 133 or section 135 or section 135A or section 136, he may arrest
such person and as soon as may be, informs him of the grounds for such arrest.
2. Every person so arrested, without unnecessary delay, is taken to a magistrate.
3. If an officer of customs has arrested any person, for releasing such person on bail or
otherwise, he has the same powers as of the officer-in-charge of a police-station.
4. An offence under this Act is not cognizable.

What is baggage? Explain the provisions of the customs act, 1962 relating to baggage.
The term “baggage” means luggage of the passengers and it refers to all dutiable goods
imported by a passenger or a member of a crew in his baggage. As per section 2(3) of Customs
Act, 1962, Baggage includes unaccompanied baggage but does not include motor Vehicle.

DECLARATION OF BAGGAGE:

1) The owner of any baggage, for the purpose of clearing it, makes a declaration of its contents
to the proper officer.

2) The rate of duty and tariff valuation, if any, applicable to baggage is the rate and valuation in
force on the date on which a declaration is made in respect of such baggage under section 77.

3) Section 77. (Declaration by owner of baggage) reads- The owner of any baggage shall, for the
purpose of clearing it, make a declaration of its contents to the proper officer.

4) Section 78 (Determination of rate of duty and tarif valuation in respect of baggage) reads -
The rate of duty and tariff valuation, if any, applicable to baggage is the rate and valuation in
force on the date on which a declaration is made in respect of such baggage under section 77.

5) Section 79(Bonafide baggage exempted from duty) reads

i)The proper officer may pass free of duty -
(a) any article in the baggage of a passenger or a member of the crew in respect of which
the said officer is satisfied that it has been in his use for such minimum specified period.
(b) any article in the baggage of a passenger in respect of which the said officer is satisfied
that it is for the use of the passenger or his family or is a bona fide gift or souvenir; provided that
the value of each such article and the total value of all such articles does
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limits.
ii) the Central Government may make rules for the purpose of carrying out the provisions of this
section and, in particular, such rules may specify -
(a) the minimum period for which any article has been used by a passenger or a member of
the crew.
(b) the maximum value of any individual article and the maximum total value of all the articles
which may be passed free of duty.
(c) the conditions subject to which any baggage may be passed free of duty.
iii) Different rules may be made for different classes ofpersons.
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 6) Section 80 (Temporary detention of baggage)reads-
If the baggage of a passenger contains any article which is dutiable or the import of which is
prohibited and in respect of which a true declaration has been made, the proper officer may, at
the request of the passenger, detain such article for the purpose of being returned to him on his
leaving India and if for any reason, the passenger is not able to collect the article at the time of
his leaving India, the article may be returned to him through any other passenger authorised by
him and leaving India or as cargo consigned in his name.

7) Section 81 (Regulations in respect of baggage) reads-

The Board may make regulations, -
(a) providing for the manner of declaring the contents of any baggage;
(b) providing for the custody, examination, assessment to duty and clearance of baggage;
(c) providing for the transit or transhipment of baggage from one customs station to another or
to a place outside India.

Explain the provisions relating to duty drawback on imports as against exports under
customs act 1962.
DRAWBACK ALLOWABLE ON RE-EXPORT OF DUTY.
PAID GOODS: (Sec. 74)
When any goods have been imported into India and upon which any duty has been paid on
importation,-
1. are entered for export and the proper officer makes an order permitting clearance and loading
of the goods for exportation or
2. are to be exported as baggage and the owner of such baggage, for the purpose of clearing it,
makes a declaration of its contents (deemed to be an entry for export) to the proper officer and
such officer makes an order permitting clearance of the goods for exportation; or
3. are entered for export by post and the proper officer makes an order permitting clearance of
the goods for exportation,

Then ninety-eight per cent, of such duty is re-paid as drawback, if

a. the goods are identified as the goods which were imported; and
b. the goods are entered for export within two years (period may be extended by the Board on
sufficient cause) from the date of payment of duty on the importation.
2. The rate of drawback for goods which have been used after the importation is fixed as per the
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3. The Central Government may make rules and regulations-
a. to provide for the manner for identity of goods imported in different consignments and stored
in bulk.
b. to specify the goods which can not be easily identified; and
c. to provide for the manner and the time to claim for payment of drawback.

DRAWBACK ON IMPORTED MATERIALS USED IN THE MANUFACTURE OF EXPORT GOODS:

(Sec. 75)
Drawback is allowed in customs duty for any of the following imported materials used in the
manufacture Of processing or carrying out any operation on such goods -
1. Goods entered for export and for such goods, an order permitting the clearance and loading
for exportation has been made by the proper officer.
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 2) Goods entered for export by post for which an order permitting clearance for exportation has
been made by the proper office.
However, no drawback is allowed, if the export value or such soods is less than the value or is
not more value specified percentage of the value of imported materials used in the manufaçture
/ processing/ carrying out any operation on such goods.

Further, if any drawback has been allowed on any goods and if the sale proceeds for such goods
are not received by the exporter in India within the time allowed under the Foreign Exchange
Regulation Act, 1973, then such drawback is not allowed and the Central Government specifies
the procedure for the recovery or adjustment of the amount of such drawback.

If the quantity of a particular material imported into India is more than the total quantity of like
material that has been used in the goods and exported outside India, then so much of the
material as is contained in the goods exported alone is deemed to be imported material for
claiming drawback.

2. The Central Government may make rules -

a for the payment of drawback equal to the amount of duty actually paid on the imported
materials.
b. for specifying the goods for which no drawback is allowed.
c. for specifying the procedure for recovery or adjustment of the amount of any drawback.
d. for the production of necessary certificates, documents and other evidence in support of
each claim of drawback.
e. for requiring the manufacturer / the person carrying out any process or operation to give
access to his manufactory to any authorised officer of customs to enable him to inspect the
processes and to verify his statements regarding drawback.
f. for the manner and the time for filing the claim for payment of drawback.

Explain the provisions relating to assessment of duty under the Customs Act 1962.+
ASSESSMENT OF DUTY: (Sec. 17 TO 23)
1. After an importer has entered any imported goods, or an exporter has entered any export
goods, the imported goods or the export goods are, without undue delay, examined and
tested by the proper officer
2. After such examination and testing, the duty leviable on such goods is assessed.
3. For the purpose of assessing duty, the proper officer may require the importer, exporter or
any other person to produce any contract, broker's note, policy insurance, catalogue or
other document whereby the duty leviable on the imported goods
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ascertained, and to furnish any information required for such ascertainment which it is in his
power to produce or furnish. Thereupon the importer, exporter or such other person must
produce such document and furnish such information.
4. Prior to the examination or testing, the imported goods or export goods may be permitted by
the proper officer to be assessed to duty on the basis of the statements made in the entry
and the documents produced and the information furnished. But if it is found subsequently
on examination or testing of the goods that any
statement in such entry or document or any information
so furnished is not true in respect of the assessment,
the goods may be re-assessed to duty.

PROVISIONAL ASSESSMENT OF DUTY: (Sec. 18)

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 1. a) If the proper officer is satisfied that an importer or exporter is unable to produce any
document or furnish any information necessary for the assessment of duty on the imported
goods or the export goods, or
b) if the proper officer deems it necessary to subject any imported goods or export goods to
any chemical or other test for the purpose of assessment of duty thereon; or
c) If the importer or the exporter has produced all the necessary documents and furnished
full information for the assessment of duty, but the proper officer deems it necessary to
make further enquiry for assessing the duty, the proper officer may direct that the duty
leviable on such goods may, pending the production of such documents or furnishing of
such information or completion of such test or enquiry, be assessed provisionally if the
importer or the exporter furnishes fit security for the payment of the deficiency between the
duty finally assessed and the duty provisionally assessed.

2. When the duty leviable on such goods is assessed finally, then-

a. in the case of goods cleared for home consumption Of exportation, the amount paid is
adjusted against the duty finally assessed and if the amount so paid falls short of, or is in
excess of the duty finally assessed, the importer or the exporter of the goods must pay the
deficiency or be entitled to a refund.
b. in the case of warehoused goods, if the duty finally assessed is in excess of the duty
provisionally assessed, execute a bond, binding himself equal to twice the then the proper
officer may require the importer to amount of the excess duty.

DUTY FOR ARTICLES LIABLE TO DIFFERENT RATES OF DUTY: (Sec. 19)

If the goods consist of a set of articles, duty is calculated as follows: -
a. articles to duty with reference to quantity is chargeable to that duty;
b. articles liable to duty with reference to value, if they are liable to duty at the same rate, are
chargeable to duty at that rate, and if they are liable to duty at different rates, be chargeable to
duty at the highest of such rates;
However-
a. the accessories and spare parts or maintenance and repairing implements for any article are
chargeable at the same rate of duty as that article;
b. if the importer produces evidence regarding the value of any of the articles liable to different
rates of duty, then such article are chargeable to duty separately at the rate applicable to it.
Duty for re-importation of goods (Sec. 20)
If goods are imported into India after exportation from India, such goods are liable to duty and all
the conditions and restrictions of the like kind goods and their value on importation.

DUTY FOR GOODS DERELICT, WRECK, ETC: (Sec. 21)

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imported into India, unless entitled to be admitted duty-free.

ABATEMENT OF DUTY: (Sec. 22)

1. a) If any imported goods had been damaged/ deteriorated before or during the unloading of
the goods in India; or
b) If any imported goods, other than warehoused goods, had been damaged after the
unloading in India but before their examination, on account of any accident not due to any
wilful act, negligence or default of the importer, his employee or agent, or
c) If any warehoused goods had been damaged before clearance for home consumption on
account of any accident not due to any wilful act, negligence or default of the owner, his
employee or agent, then such goods value after damage/ deterioration bear the proportion
to the duty chargeable on the goods before the damage or deterioration.
2. The value of damaged or deteriorated goods may be ascertained by either of the following
methods at the option of the owner:-
a. The value of such goods may be ascertained by the proper officer or
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 b. Such goods may be sold by the proper officer by public auction or by tender, or with the
consent of the owner in any other manner, and the gross sale proceeds are deemed to be the
value of such goods.

Remission of duty (Sec. 23)

1. If anybody have been lost or destroyed, at any time before clearance for home consumption,
assistant commissioner, or deputy commissioner of customs, remit the duty on such goods.
2. The owner of any important good me at any time before an order for clearance of the goods
for home consumption, or an order for permitting the deposit of goods in a warehouse,
relinquishment his title to the goods and thereupon he is not liable to pay the duties thereon.

Define the term warehouse. Explain the provisions for clearance of goods under Customs
Act, 1962.

Warehousing is the process of storing physical goods before they are sold further or distributed.
Warehouses safely and securely store products in an organized way to track where items are
located, when they arrived, how long they have been there, and the quantity on hand. The
provisions for warehousing have been mentioned under Chapter IX of the Customs Act, 1962
and other subsequent rules and regulations. The legal provisions relating to Warehousing are
contained under Sections 57 to 73 of Customs Act, 1962 & Rule 2(18). The law also lays down
the time period up to which the goods may remain in a warehouse without incurring any interest
liability and with interest liability.

Relevant Provisions for Warehousing under Indian Customs Law

Appointment of Public Warehouses (Section 57)[5]: The section prescribes that the Principal
Commissioner of Customs or the Commissioner of Customs may subject to certain conditions
prescribe; appoint a public warehouse wherein dutiable goods may be deposited. These
warehouses are managed by the warehousing corporations. The goods can be deposited by any
person and there can be no cancellation of license.

Licensing of Private Warehouses (Section 58)[7]:This section provides that a license may be
provided to any private warehouse under fulfillment of certain conditions by the Principal
Commissioner of Customs or the Commissioner of Customs wherein dutiable goods may be
imported on behalf of the licensee. The goods of the owners can only be deposited and the
license can be cancelled for violation of the warehousing provisions.
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Warehousing Bond (Section 59)[10]: The importer or his representative is required to present
to the Customs a Bill of Entry for warehousing under Section 46 and assessed under Section 17
or Section 18 of the Customs Act shall execute a bond for sum equal to thrice the amount of the
duty assessed for such goods and to pay all duties and interest payable under sub-section (2)
of Section 61 and to pay all fines and penalties incurred for the contravention of any provisions
under this Act.
Permission of deposit of goods in a Warehouse (Section 60)[11]: This is applicable when the
provisions of Section 59 have been complied with respect of any goods whereby the proper
officer may make an order permitting the deposit of the goods in a warehouse.
Period for which goods may remain warehoused (Section 61)[12]: The goods deposited in a
bonded warehouse may be stored for a period of one year. However, in case of capital goods
intended for any 100% export-oriented undertaking, then such goods can be stored for a period
of 5 years. The period of warehousing can be extended by the Commissioner of Customs for a
period of 6 months and by the Chief Commissioner of Customs for such further period.
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 Control over warehoused goods (Section 62)[13]: The goods deposited in the warehouse shall
be subject to control of the proper officer. No person can enter the warehouse without the
permission of the proper officer or remove any goods there from. The proper officer may cause
the warehouse to be locked with the lock of the Customs Department and no person shall
remove or break such lock and the officer shall have access to every part of the warehouse and
have the power to examine the goods.
Payment of rent and warehouse charges (Section 63)[14]: The rent has to be paid by the
owner of the warehoused goods to the warehouse-keeper at the rates fixed under any law for
the time being in force or where no rates are so fixed, at such rates as may be fixed by the
Commissioner of Customs. If the rent is unpaid within ten days from the date the warehouse-
keeper may after notice to the owner of the warehoused goods and with permission of the
proper officer sell a sufficient portion of the goods as the warehouse-keeper may select.
Owner’s right to deal with warehoused goods (Section 64)[15]: The owner of goods may with
the sanction of the proper officer and after the payment of prescribed fees inspect the goods,
separate damaged or deteriorated goods from the rest, sort the goods and change their
containers for the purpose of preservation, sale, export or disposal of goods, deal with goods
and their containers in such a manner as may be necessary to prevent loss or deterioration or
damage to the goods, show the goods for sale, or take samples of goods without entry for home
consumption, and if the proper officer so permits, without payment of duty on such samples.
Cancellation and return of warehousing bonds (Section 73)[24]: The proper officer shall
cancel the bond as discharged in full and shall on demand deliver it so cancelled to the person
who has executed as per Section 59 and has been cleared for home consumption or export is
entitled to receive it.
General power to make regulations : Section 157 of the customs Act, 1962[25] empowered the
Central Government of Board to make regulations consistent with this Act and rules to carry out
the purpose of this Act. Accordingly, the Central Government / Board made the following
regulations for the smooth operation of warehouse to facilitate imported goods and goods
meant for export:

Explain the prevention or detection of illegally imported goods under the customs act 1962.

PROHIBITIONS ON IMPORTATION AND EXPORTATION OF GOODS: (Sec. 11)

POWERS OF CENTRAL GOVERNMENT TO PROHIBIT IMPORTATION OR EXPORTATION OF
GOODS:

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conditions, the import or export of goods of any specified description for the following purposes
:-
a. the maintenance of the security of India;
b. the maintenance of public order and standards of decency or morality;
c. the prevention of smuggling;
d. the prevention of shortage of goods of any description (in case of exports);
e. the conservation of foreign exchange and the safeguarding of balance of payments;
f. the prevention of injury to the economy of the country by the uncontrolled import or export of
gold or silver;
g. the prevention of surplus of any agricultural product or the product of fisheries;
h. the maintenance of standards for the classification, grading or marketing of goods in
international trade.
i. the establishment of any industry;
j. the prevention of serious injury to domestic production of goods of any description;
k. the protection of human, animal or plant life or health;
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 l. the protection of national treasures of artistic, historic or archaeological value;
m. the conservation of exhaustible natural resources;
n. the protection of patents, trademarks and copyrights;
o. the prevention of deceptive practices;
p. the carrying on of foreign trade in any goods by the State/ State corporation to the
exclusionof citizens of India.
q. the fulfilment of obligations under the Charter of the United Nations for the maintenance of
international peace and security;
r. the implementation of any treaty, agreement of convention with any country;
s. the compliance of imported goods with any laws which are applicable to similar goods
produced or manufactured in India;
t. the prevention of dissemination of documents likely to prejudicially affect friendly relations
with any foreign State or is derogatory to national prestige;
u. the prevention of the contravention of any law
v. any other purpose conducive to the interests of the general public.

Write the various provision for clearance of imported and exported goods under customs
act 1962.

CLEARANCE OF IMPORTED GOODS:

RESTRICTIONS ON CUSTODY AND REMOVAL OF IMPORTED GOODS: (Sec. 45)
1. All imported goods unloaded in a customs area should remain in the custody of approved
person till they are cleared (for home consumption) or warehoused or transshipped.
2. The person having custody of any imported goods in a customs area,
a. must keep a record of such goods and send its copy to the proper officer;
b. must not permit such goods to be removed from the customs area with out the
permission of the proper officer.
3. If any imported goods are pilfered after their unloading in a customs area while in the
custody of a person, then that person is liable to pay duty on such goods at the prevailing
rate.

CLEARANCE OF EXPORT GOODS:

1. ENTRY OF GOODS FOR EXPORTATION: (Sec. 50)
i) The exporter of any goods should make entry by
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presenting to the proper officer-
a. in the case of goods to be exported in a vessel or aircraft - a shipping bill.
b. in the case of goods to be exported by land - a bill of export.
ii) The exporter of any goods should also declare as to the truth of its contents.

2) BILL OF LADING:
1. A bill of lading is a document acknowledging the shipment of goods, signed by the carrier.
2. It contains the terms and conditions on which the goods are agreed to be carried by the
carrier.
3. It is a quasi-negotiable instrument. It is a document of title and can be transferred by
endorsement and delivery.
4. It is used for the carriage of goods on a general ship, and not in a charter party.
5. A bill of lading may rarely be issued even when the ship is chartered Here, the bill of lading
operates as a mere acknowledgement for receipt of goods.
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 3) SHIPPINg BiLL:
a. Meaning:
Shipping bill is the main document required by customs authority for clearance of goods for
shipment. An exporter, while sending goods from one country to another has to go through
various formalities. It includes submitting various applications, acquiring licenses, paying duties,
etc.,

Importance of Shipping Bill:

1. To get a clearance for export from the Customs, an exporter will have to submit an application
called the 'shipping bill'.
2. Goods cannot be loaded unless the exporter files the shipping bill.
3. In other words, the goods can be taken on board, only if the goods are accompanied by
certain documents as described below:
a) At seaport/ airport- Shipping bill
b) At land customs station- Bill of export
c) For goods transhipment- Bill of tranship"

CLEARANCE OF GOODS FOR EXPORTATION: (SEc. 51)

If any goods entered for export are not prohibited goods and the exporter has paid the duty, the
proper officer may make an order permitting clearance and loading of the goods for exportation.

Short notes
Write a short notes on power to grant exemption from duty under Customs Act, 1962.+
Sec. 25
Power to Grant Exemption from Duty. –
(1) 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.
(2) If the Central Government is satisfied that it is necessary in the public
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may, by special order in each case, exempt from payment of duty, for reasons to be stated in
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such order, any goods, of strategic or secret nature, or for charitable purpose, on which duty is
leviable .
(3) An exemption under sub-section (1) or sub-section (2) in respect of any goods from any part
of the duty of customs leviable thereon (the duty of customs leviable thereon being hereinafter
referred to as the statutory duty) may be granted by providing for the levy of a duty on such
goods at a rate expressed in a form or method different from the form or method in which the
statutory duty is leviable and any exemption granted in relation to any goods in the manner
provided in this sub-section shall have effect subject to the condition that the duty of customs
chargeable on such goods shall in no case exceed the statutory duty.
Explanation : "Form or method", in relation to a rate of duty of customs, means the basis,
namely, valuation, weight, number, length, area, volume or other measure with reference to
which the duty is leviable .
(4) Every notification issued under sub-section (1) shall
(a) unless otherwise provided, come into force on the date of its issue by the Central
Government for publication in the Official Gazette;
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 (b) also be published and offered for sale on the date of its issue by the Directorate of Publicity
and Public Relations of the Board, New Delhi.
(5) Notwithstanding anything contained in sub-section (4), where a notification comes into force
on a date later than the date of its issue, the same shall be published and offered for sale by the
said Directorate of Publicity and Public Relations on a date on or before the date on which the
said notification comes into force.

Write a note on restrictions on Exports and Imports.+

Prohibition on importation and exportation of goods (Sec.11)
Powers of central government to prohibit importation or exportation of goods.
The central government has powers to prohibit, either absolutely or subject to specified
conditions, the import or export of goods of any specified description for the following
purposes:-
1. The main of the security of india
2. The mainte of public order and standards of decencey or morality
3. The prevention of sumggling
4. The prevention of shortage of goods of any description
5. The converation of foreign exchange and safeguarding of balance of payments
6. The prevention of injury to the exonomy of the country by the uncorntrolled import or export
of gold and silver
7. The prevention of surplus of any agriculture product or the product of fisheries
8. The establishment of industry
9. The protection of human, animal or plant life or health
10. The prevention of deceptive practices
11. The implementation of any treaty, agreement or convention with any country
12. The conversation of exhaustible natural resources
13. The protection of patents, trademarks and copyrights
14. Any other purpose conducive to the interest of the general public

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Powers and functions of Customs Authorities under Customs Act, 1962.+

Classes of officers of customs (Sec.3)

There are the following classes of officers of customs namely
a. Chief commissioners of Customs
b. Commission of Customs
c. Commissioners of Customs (Appeal)
d. Joint Commissioners of Customs
e. Deputy Commissioners of Customs
f. Assistant Commissioners of Customs
g. Such other class of appointed officers of customs

Appointment of officers of customs (Sec.4)

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 1. The central government appoint suitable persons as officers of customs
2. The central government may authorise the board, any class of officers mentioned in Sec.3
Powers of officers of customs (Sec.5)
An officer of customs may exercise the conferred powers and discharge the imposed duties.
An officer of customs may also exercise the powers and discharge the duties on any other
officer of customs who is subordinate to him.
A commissioner should not exercise the powers and discharge the duties of an officer of
customs other than the specified powers.

Entrustment of functions (Sec.6)

The central government entrusts to any officer of the central or the state government or a local
authority any functions of the board or any officer of customs.

SEZ Unit under Customs Act, 1962.

The Special Economic Zones Act, 2005 provides for the establishment, development and
management of the Special Economic Zones for the promotion of exports
and connected matters.
1. A Special Economic Zone may be established under this Act, either jointly or individually by
the Central Government/ State Government/any person for manufacture of goods or/and
rendering services or as a Free Trade and Warehousing Zone.
2. Any person, who intends to set up a Special Economic Zone, may, after identifying the area,
make a proposal to the State Government concerned for the purpose of setting up the
Special Economic Zone.
3. In case, a State Government intends to set up a Special Economic Zone, it may after
identifying the area, forward the proposal directly to the Board for the purpose of setting up
the Special Economic Zone.

Concessions and exemptions granted for industries in the Special Economic Zones (Customs
Act, 1962):
a. Exemptions from any duty of customs, under the Customs Act, 1962 or the Customs Tariff
Act, 1975, 5 of 1986.
b. Exemptions from any duty of excise, under the Central Excise Act, 1944 or the Central Excise
Tariff Act, 1985
c. Exemptions from service tax under Chapter-V of the Finance Act, 31/03/23,
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d. Exemptions from the securities transaction tax leviable under section 98 of the Finance Act,
2004.
e. Exemptions from the levy of taxes on the sale or purchase of goods other than newspapers
under the Central Sales Tax Act.
f. Exemptions from the provisions of the Income Tax Act, 1961, to, the Developer or entrepreneur
for carrying on the authorised operations in a Special Economic Zone or Unit.
A Fund called the Special Economic Zone Authority Fund is established to meet the expenses
regarding establishment and administration of the special economic zone.

Write a note on baggage.

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