Directorate General Customs Valuation (DGCV) on Thursday revised the customs duty on imported tetra pack milk under section 25(9) of the Customs Act, 1969.
According to the revised valuation, the Directorate earlier conducted an audit of clearance values of imported tetra pack milk including Lacnor, Almarai, Soyafresh milk etc and during the course of perusal of import clearance data, it was observed that the said goods were being assessed at lower values compared to the international selling prices and local market prices.
As a stop-gap arrangement and to sensitise the clearance collectorates, the DGCV earlier issued database values in December 2016 for the said goods. Thereafter, as per policy in vogue, the valuation database reference values are required to be converted into valuation ruling for uniform applicability across the country.
Meanwhile, number of importers filed representations to revisit the VDB values in accordance with their declarations. In this context, the Directorate initiated an exercise for determination of customs values of imported branded milk under section 25 A of Customs Act. 1969.
For the purpose, all stakeholders were invited for the meetings held on February 28, 2017 and March 21, 2017. The importers strongly contended during meetings and requested that the values determined in the valuation database 118 may be reviewed downwards.
The importers were of the view that actual value of imported tetra pack milk was lower than the values determined in the said valuation database and the costs of selling were incorrectly accounted for. They also insisted that a fresh market surveys should be conducted from local market for determination of customs values of the imported tetra pack milk.
Furthermore, they said that these perishable items were sold on sale and discounted prices due to its limited shelf life and added that since the said goods were mainly being sold on super and retail markets, therefore, a lot more expenses (shelf rent, marketing expenses etc.) were contributed at retail level which could not be managed without taking extra profit margins.
The importers contended that all these factors may also be considered in fixing value of said goods and the prices were also verified on the basis of location of market in the city and date of expiry of the product in question.
Later, PRAL database, market information and international prices through Web were examined thoroughly. All the information was analysed for determination of customs value of the said good.
Consequently, the Fall-Back method as provided under section 25(9) of the Customs Act, 1969 was applied to arrive at assessable customs values of various brands of imported tetra pack milk.