In exercise of the powers conferred by sub section (1) of section 25 of the Customs Act, 1962 (52 of 1962) and section 124 of the Finance Act, 2021 (13 of 2021) (hereinafter referred to as the said section), the Central Government, on being satisfied that it is necessary in the public interest so to do

## Report on Customs Duty Exemption Notification No. 21/2022 **1. Executive Summary:** This report analyzes Notification No. 21/2022-Customs, issued by the Ministry of Finance, Department of Revenue, on April 13, 2022. This notification exempts specific goods imported into India from a portion of the customs duty and Agriculture Infrastructure and Development Cess (AIDC). The notification outlines the description of goods eligible for the exemption and the applicable standard and AIDC rates. This report summarizes the key provisions of the notification, its potential impact, and its limited timeframe of applicability. **2. Introduction:** The purpose of this report is to provide an informative overview of Notification No. 21/2022-Customs, dated April 13, 2022. This analysis is based solely on the information contained within the provided notification text. **3. Policy Overview:** * This is a new policy notification granting exemptions. * **Core Objective(s):** Based on the text, the core objective is to exempt certain imported goods from a portion of the customs duty and the Agriculture Infrastructure and Development Cess (AIDC). The notification explicitly states this action is taken "in the public interest." **4. Background and Rationale:** * The notification aims to reduce the financial burden of customs duty and AIDC on the import of specific goods into India. The text states that the Central Government deems this exemption "necessary in the public interest," suggesting a broader goal of supporting industry or managing the cost of goods impacted by the exemption. Without further context, the specific problem or issue being addressed can only be inferred as a general desire to ease the financial burden of importing specific goods. **5. Key Provisions / Changes:** * This is a **New Policy**. The notification establishes the following: * An exemption from a portion of the customs duty leviable under the First Schedule to the Customs Tariff Act, 1975, for goods specified in column 3 of the Table provided. * An exemption from a portion of the Agriculture Infrastructure and Development Cess (AIDC) leviable under Section 124 of the Finance Act, 2021, for the same goods. * The "Table" within the notification identifies specific goods (described in column 3) falling under specified Chapters, Headings, subheadings, or tariff items (column 2) of the Customs Tariff Act, 1975. * For each eligible item, the "Standard Rate" (column 4) and "AIDC Rate" (column 5) specify the portion of the original customs duty and AIDC, respectively, that *still* applies *after* the exemption. In this specific case the rates are set to Nil for both. * The notification is effective from April 14, 2022, and remains in force until September 30, 2022, inclusive. **6. Target Audience and Stakeholders:** Based on the provided text, the primary target audience and stakeholders include: * **Importers of goods classified under Chapter 5201:** This specifically refers to "All goods". * Businesses and individuals involved in the import of goods are subject to customs duty and AIDC. * Customs officials responsible for implementing and enforcing the Customs Act, 1962 and the Finance Act, 2021. **7. Implementation Aspects (Inferred):** * **Responsible agency:** The Central Board of Indirect Taxes and Customs (CBIC), operating under the Ministry of Finance, Department of Revenue, is the responsible agency. This is inferred from the F. No. CBIC number and the Ministry of Finance's issuance of the notification. * **Timelines:** The notification is effective from April 14, 2022, to September 30, 2022. Customs officials must apply the exemption within this timeframe. The industry will need to ensure imports occur within this period to benefit from the exemption. * **Procedures:** Importers must correctly classify their goods under the appropriate Chapter, Heading, Subheading, or Tariff Item of the Customs Tariff Act, 1975, to claim the exemption. Customs officials will verify the classification and apply the corresponding Standard Rate and AIDC Rate as specified in the notification's table. **8. Expected Outcomes / Impact of Changes:** * The likely intended outcome is to reduce the cost of importing goods classifiable under heading 5201 (All goods). * This could lead to increased import volumes of these goods during the effective period of the notification. * The temporary nature of the exemption may encourage businesses to expedite imports to take advantage of the reduced duty and cess. **9. Conclusion:** Notification No. 21/2022-Customs provides a temporary exemption from a portion of customs duty and AIDC on specified imported goods. This exemption, effective from April 14, 2022, to September 30, 2022, has the potential to significantly reduce import costs for goods falling under the specified tariff item and to impact trade flows. Importers and customs officials must be aware of the notification's provisions and timelines to ensure proper implementation and compliance. The limited scope of the document means further analysis would be needed to fully assess the broader economic impact of this notification.

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