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Provisions of Customs Valuation System in Customs Act. 1962. The following procedures and system shall be adopted for the purpose of the assessment of customs duty on the basis of transaction value as per provisions made in Article 13 of Customs Act, 2019 (1962). a. Customs duty of any importing goods shall be determined on the basis of transaction value of the goods concerned. b. The owner of the goods has to submit to the customs office the invoice or bill indicating the value of the goods and other documents demanded by customs officer to prove the transaction value of the goods c. The responsibility to verify the authenticity of the invoice, bill or other documents presented by the owner shall rest with the owner himself d. In determining customs duty of any imported goods on the basis of transaction value, if the transaction value presented by the owner of the goods does not correspond with the process of determining actual transaction value then the principal authority of customs or any customs officer specified by him shall determine the customs duty of such goods on the basis of recorded value, price list (or valuation list) or the value of similar goods. f. For the purpose of determining customs duty the principal authority of customs or any customs officer specified by him may have recourse to recorded value, price-list presented by the producer or the distributor or available data or information or the suggestion of expert, related organization or body as basis in determining the value of goods. g. For the purpose of customs duty His Majesty's Government is determining the value of any goods may take as base generally the invoice and bill produced by the owner of the goods or the authentic price-list of the producer or distributor of the goods or international market value or the suggestion of specialist related to the goods or institution or person related to industry, commerce and trade. h. If the Transaction value of any goods bought and brought from outside the kingdom, gift or sample received could not be determined, the owner should submit an application clarifying all things to the customs concerned. i. If it is confirmed after examination of the application submitted according to sub-section (8) that transaction value could not be determined, the principal authority of customs or other officer specified by him may determine the value of such goods as per sub-section (5). j. No demurrage shall be charged on imported goods until the valuation of the goods for the purpose of assessing customs duty is fixed. Provisions of Valuation System in Financial Ordinance (has force as law) 2003 [ TOP ] As per the ordinance, the following procedures and system shall be adopted for the purpose of the assessment of customs duty on the basis of transaction value in addition to the provisions made in Article 13 of Customs Act, 2019 (1962) (1) The "Transaction Value" mentioned in Article 13 of Customs Act, 1962, shall mean the total declared amount by the importer which is actually paid or payable by the buyer to the seller to import goods. It also includes the amount incurred or likely to be incurred for freight, insurance and all other expenses up to the border of the Kingdom of Nepal. If the documents of the freight, insurance and all other expenses are not submitted, the Customs Officer shall determine the transaction value on the basis of the presumptive expenses. The Director General of the Department of Customs may fix the norms for expenses incurred or likely to be incurred for the purpose of determining the transaction value. (2) Customs officer shall have to follow the fundamental principles of the World Trade Organization (WTO) in regard to the determination of value, whether or not the buyer and seller are related. (3) The customs officer shall ask for appropriate reason and enough evidence if the transaction value declared under Sub-article (1) is less than the declared value of the pre-imported identical or similar goods. (4) In case such transaction value is verified on the basis of the documents and reasons presented by the importer as per subsection (3) the customs officer shall accept the value with due justification in circumstances the transaction value could not be determined even in accordance with the above, the customs officer shall accept with justification on the basis of documents and reasons presented by the importer if such transaction value is verified. The customs officer shall forward such acceptance to the Department of Customs for review of the assessed value. (5) If the transaction value provided by the importer under Sub-articles (1) and (4) is not proven valid, customs officer shall access the transaction value based on the principles specified in Sub-article (2) and shall notify the same with reasons to the importer. (6) In case the importer is not satisfied with the transaction value determined by customs officer as per sub-section (5), he (the importer) may within 15 days appeal to the Director General of Customs directly or through the customs office concerned for review of the assessed value. The application submitted to the customs office has to be forwarded to the Director General within 7 days. The Director General shall normally give his decision within 21 days on such application. The Director General may consult Expert Committee while making decision upon such appeal. (7) If the transaction value determined under Sub-article (5) is less than the transaction value under Sub-article (1), a hundred percent chargeable duty is levied on such difference value in addition to the normal duty. Or with the prior approval of the Director General such goods could be purchased or get it purchased on the declared value plus freight, insurance and five percent profit on it. [ TOP ] (8) In case the transaction value of the goods could not be ascertained by the customs officer there and then and the importer wishes to clear his goods from the customs, the customs officer may determine a provisional value of the goods. The importer is permitted to clear his goods by placing upon deposit the amount of customs duty chargeable on the value. The goods cleared, the transaction value has to be determined within thirty days on the basis of subsection (4) & (5). (9) After the clearance of goods from the customs office, post clearance audit of selected firms or commodities will be carried out by an official designated by the Director General. Criteria for selecting firms or commodities will be as specified by the Director General. If the value is found to be under-stated in course of Post Audit, duty shall be recovered on such under-stated value and additional duty is charged on such duty under Sub-article (7) and other penalties shall be imposed under prevalent laws. (10) The value of goods imported under Baggage Rules will be as determined by the customs officer. (11) Determination of value of goods imported under DRP shall be as follows : (a) Value shall be determined by adding the expenses of insurance, freight and other, if any, in whichever value is greater between the value determined by government of India for the purpose of assessing excise duty and ex-factory or ex-depot price. (b) No other rebate shall be accepted except the rebate allowed in maximum retail price (MRP) of the imported goods clearly mentioned. (c) Clearly and separately mentioned freight in invoice and the receipt of payment of premium of insurance shall be accepted. In circumstances, no separate mention of freight in invoice is made and no receipt of payment of premium is presented the value shall be determined by adding minimum 5% of the invoice value for the freight and insurance. [ TOP ] (d) The amount of excise duty paid in India of goods imported under DRP shall be deducted from the customs duty chargeable as per tariff. Nevertheless no amount of Indian excise duty shall be deducted from the chargeable customs duty on the difference found in freight, insurance and value plus other expenses. (12) Vehicles, machines, equipment and goods imported under customs privilege (diplomatic privilege) or full or partial duty privilege or imported with the imposition of only one percent customs duty or imported temporarily by placing on record or on bank guarantee on condition to take them back later shall be charged customs duty in accordance with rules on the amount of value that remains after reducing as depreciation at the rate of ten percent per annum up to five years on residual basis from the value fixed at the time of importation in case goods are presented as gift or donation or sold to any person of the importer keeps them for his own use in the Kingdom of Nepal. In determining the value in this way the duty shall normally be assessed on the basis of (value) in foreign currency fixed at the time of importation except in circumstances when the value differs substantially from the value of similar goods of regular import. In case the goods in question has been imported second hand the facility of depreciation on such item shall be accorded after deduction the period of use (utilization) of the item not exceeding five years (of such utilization). (13) While determining the transaction value of goods which are imported in the Kingdom of Nepal, the value is generally calculated in foreign currency. In case the valuation of dutiable goods is in foreign currency, the selling rate of foreign exchange fixed by the Nepal Rastra Bank (NRB) on the date of customs clearance of the concerned commodity shall be applied to convert the same into the Nepalese Currency. In case the exchange rate of a foreign currency is not published by NRB, the foreign currency shall be converted into US$ and US$ shall be converted into the Nepalese Currency by applying the selling rate of US$. (14) The freight of import by air route be determined as the cost of surface route transportation up to the customs point in Nepal boarder and customs duty shall be realized on it. [ TOP ] |
