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Unit 8: Custom Duties

Any Importer or Exporter for being knowingly concerned in any fraudulent evasion or attempted Notes
evasion of any prohibition under the Customs Act or any other law for the time being in force
in respect to any import or export of goods, shall be liable to punishment with imprisonment
for a maximum term of three years (seven years in respect of notified goods) under section 135
of the Customs Act. Any person who is reasonably believed to be guilty of an offence, punishable
under section 135, may be arrested under the provisions of section 104 of the Customs Act.
Keeping in view the above penal provisions in the Customs Act to deal with any deliberate
evasion of prohibition/restriction of import of export of specified goods, it is advisable for the
Trade to be well conversant with the provisions of EXIM Policy, the Customs Act, as also other
allied Acts. They must make sure that before any imports are effected or export planned, they
are aware of any prohibition/restrictions and requirements subject to which alone goods can be
imported/exported, so that they do not get penalised and goods do not get involved in
confiscation etc. proceedings at the hands of Customs Authorities.

Principles of Restriction

DGFT may, through a notification, adopt and enforce any measure necessary for:

 Protection of public morals.
 Protection of human, animal or plant life or health.

 Protection of patents, trademarks and copyrights and the prevention of deceptive practices.
 Prevention of prison labour.
 Protection of national treasures of artistic, historic or archaeological value.

 Conservation of exhaustible natural resources.
 Protection of trade of fissionable material or material from which they are derived, and

 Prevention of traffic in arms, ammunition and implements of war.
Terms and Conditions of a Licence/Certificate/Permission

Every licence/certificate/permission shall be valid for the period of validity specified in the
licence/certificate/permission and shall contain such terms and conditions as may be specified
by the licensing authority which may include:

 The quantity, description and value of the goods;
 Actual user condition;
 Export obligation;

 The value addition to be achieved; and
 The minimum export price.

Licence/Certificate/Permission not a Right

No person may claim a licence/certificate/permission as a right and the Director General of
Foreign Trade or the licensing authority shall have the power to refuse to grant or renew a
licence/certificate/permission in accordance with the provisions of the Act and the Rules made
thereunder.

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