CBIC eases paperwork to claim concessional duty on imports from UK | Economy & Policy News

In a trade-facilitation step for companies using the India-UK pact, the Central Board of Indirect Taxes and Customs (CBIC) has said Form-I need not be filed with every bill of entry — the main customs form submitted when goods arrive in India — to claim lower duty on UK consignments.

A customs circular, dated September 24, says a valid Origin Declaration, a self-certification by the UK exporter or producer that the goods meet the pact’s origin rules, is enough proof for the concessional rate under the India-UK Comprehensive Economic and Trade Agreement (CETA). Form-I, a separate origin-check sheet under the Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020, or CAROTAR, will not be treated as a precondition for the benefit.

CAROTAR comprises India’s domestic rules for checking whether imported goods truly originate in a free-trade partner country and can get the cheaper duty. The Board said it had received certain concerns from trade and clarified that Form-I is not required with the bill of entry and is not a precondition for the CETA duty cut.

Customs authorities may still seek Form-I particulars, but only if the National Risk Management System (NRMS), the computerised filter that picks consignments for extra checks, flags the shipment for origin scrutiny and the officer has reason to believe the origin rules have not been met. Importers need not extract confidential production data from the UK supplier; non-furnishing of such information cannot, by itself, be used to deny the concession. If what the exporter has shared is still not enough, verification is to go through the UK authorities under the treaty.

The Board also said later consignments must not be treated as identical to an earlier rejected shipment merely because the description, tariff classification — the customs code of the goods — exporter or producer looks similar. The importer must get a chance to place fresh facts on record; if the goods differ in any material way relevant to origin, the new claim has to be examined on its own. Where CAROTAR clashes with the treaty’s origin rules, the treaty prevails.

Gautam Khattar, Principal at Price Waterhouse & Co LLP, said the circular shifts the regime from routine, importer-led collection of origin data to targeted, risk-based checks aligned with CETA’s self-certification design. Before the clarification, he said, importers often had to chase overseas suppliers for production, value-addition and originating-status details they could not see, while exporters resisted sharing commercially sensitive information. The Board has now said officers should ordinarily rely on the Origin Declaration and that importers need furnish only what the exporter has made available, without diluting Customs’ power to verify origin when a bill of entry is flagged and doubt remains.

Amit Maheshwari, Managing Partner, AKM Global, said the circular “puts the CETA’s Origin Declaration back in the driver’s seat instead of Form-I”. By limiting Form-I to consignments flagged by the risk system and making clear that importers cannot be penalised for information exporters will not share, CBIC had lowered the friction around claiming the concessional rate, he said. Authentication of the Origin Declaration only establishes its provenance; checking whether the goods actually meet origin rules remains a separate exercise.

Importers had long feared that one adverse finding would become a blanket denial for every future shipment. Customs, Maheshwari said, must now see whether later goods are truly identical from an origin standpoint and give the importer a chance to bring the facts on record. “It is a trade-friendly signal, but its success will depend entirely on how consistently ports actually apply it.”