12th April, 2002

Notification No. 40 /2002- Customs

            In exercise of the powers conferred by section 3A of the Customs Tariff Act, 1975 (51 of 1975), (hereinafter referred to as the said Act) read with sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), and ­­­­­­­­­  in supersession of the notification of the Government of India in the Ministry of Finance( Department of Revenue) No. 37/96-Customs,  dated the 23rd July 1996 , [  G.S. R.  289  (E) dated the  23rd July, 1996] , except as respects things done or omitted to be done before such supersession , the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods specified in column(2) of the Table below   and falling within the   First Schedule to the said Act, when imported into India from Nepal, -

(a)

from the whole of the duty of customs leviable thereon under the said First Schedule to the said Act, and
(b) from the whole of the special additional duty leviable thereon under section 3A of the said  Act ,

subject to the conditions, if any, specified in the Annexure to this notification, the Condition No. of which is mentioned in the corresponding entry in column( 3 ) of the said Table.                

        Provided   that the exemption from special additional duty shall not be applicable in case of imports of vanaspati, acrylic yarn and winding/insulated wires of copper.  

TABLE

S.No

Description of goods

Condition No.

(1)

(2)

(3)

 1.

 (i) Agricultural, horticultural and forest produce and minerals which have not undergone any processing;
(ii) Rice, pulses and flour;
(iii) Timber;
(iv) Jaggery (gur and shakkar);
(v) Animals, birds and fish;
(vi) Bees, bees-wax and honey;
(vii) Raw wool, goat hair and bones as are used in the manufacture of bone-meal;
(viii) Milk, home-made products of milk and eggs;
(ix) Ghani-produced oil and oil-cakes;
(x) Ayurvedic and herbal medicines;
(xi) Articles produced by village artisans as are mainly used in villages;
(xii) Yak tail;
(xiii) Akra.

1

    2.

All manufactured goods other than the following: -
(i) Alcoholic Liquors or beverages and their concentrates, other than beer and Industrial spirits;
(ii) Perfumes and cosmetics with non-Nepalese or non-Indian brand names; 
(iii) Cigarettes and Tobacco;
(iv) Vegetable fats (Vanaspati);

(v) Acrylic Yarn;
(vi)  Copper products falling under Chapter 74 and heading 85.44 of the   First Schedule to the said Act , and
(vii)  Zinc Oxide .

2

3.

 (i) Vegetable fats (Vanaspati);
(ii) Acrylic Yarn;
(iii)  Copper products falling under Chapter 74 and heading 85.44 of the First Schedule to the said Act, and
(iv)  Zinc Oxide.  

2 and 3

 ANNEXURE

Condition No

Condition

1.

If the goods are wholly produced in Nepal .

2.

A (1)The  goods   are manufactured in Nepal wholly from Nepalese materials or Indian materials or Nepalese and Indian materials; or  

    (2) The  goods   involve a manufacturing process in Nepal that brings about a change in classification at four digit level of the Harmonised Commodities Description and Coding System, different from those, in which all the third country origin materials used in the manufacture of such goods are classified and the manufacturing process is not limited to insufficient working or processing as indicated in the illustrative list below:        

(i)        Operations to ensure the preservation of articles in good condition during transport and storage (e.g., ventilation, spreading out, drawing, chilling, placing in salt, sulphur-dioxide or other aqueous solutions, removal of damaged parts and like operations);

(ii)      Operations consisting or removal of dust, sifting or screening, sorting, classifying, matching (including the making up of sets), washing, painting, cutting up;

(iii)    Changes of packing and breaking up and assembly of consignments;

(iv)    Slicing, cutting, slitting, re-packing, placing in bottles or flasks or bags or boxes or other containers, fixing on cards or boards, etc., and all other packing or re-packing operations;

(v)      The affixing of marks, labels or other like distinguishing signs on articles or their packaging; (vi)     Mixing of articles, whether or not of different kinds, where one or more components of the mixture do not meet the conditions laid down in para 1 (b) of Protocol to the Article V of the Treaty of Trade between His Majesty's Government of Nepal and the Government of India to enable them to be considered as manufactured or produced or made in Nepal;

(vii)     Assembly of parts of an articles to constitute a complete article;

(viii)     A combination of two or more operations specified in (i) to (vii) above.  

B.  The importer produces a  certificate of origin in the Form indicated below,    duly certified by an agency designated by His Majesty's Government of Nepal, in respect of the consignment, to the satisfaction of the Assistant Commissioner of Customs or Deputy Commissioner of Customs , as the case may be, that such goods have in fact been manufactured in Nepal .

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FORM OF CERTIFICATE OF ORIGIN  

Certificate of origin for exports free of customs duties under the Treaty of Trade between His Majesty's Government of Nepal and the Government of India

Reference No. ________________  

1.  Articles consigned from (Exporter's business name, address):

2.  Articles consigned to (Consignee's name, address):

3.  Means of transport and route:

4.  Item number (HS Tariff Line):

5.  Marks and number of package:

6.  Description of Articles :

7.  Gross weight or other quantity :

8.  Number and date of Invoice together with value:

9.  Ex-Factory price* of the articles manufactured in Nepal :  

* ‘Ex-factory price’ means the price of the product at the time of the clearance from the factory gate.

10. (i) Whether articles are manufactured in Nepal under Para 1(a) of the Protocol to Article V of the Treaty of Trade

(Yes/No):

(ii) If articles are manufactured in Nepal under Para 1 (b) (i) and (ii) of the Protocol to Article V of the Treaty of Trade:

 (A) CIF value of materials, parts or produce originating
from Non-Contracting Parties (i.e. other than Nepal and India ) at the point of entry in Nepal :-

(B) Value of materials, parts or produce of undetermined origin:-

11. Percentage of the sum of the value of col. 10(ii) (A) and (B) to the value of col. 9:

12. Declaration by the exporter:

The undersigned hereby declares that the details furnished above are correct, that the articles are produced in Nepal and that they comply with the Rules of Origin specified in the Treaty of Trade between His Majesty's Government of Nepal and Government of India.

_____________________

(Place and Date, Signature of authorised signatory)

13. Certification:

It is certified that the articles herein referred to are eligible for preferential treatment as per provisions of the Treaty of Trade between His Majesty's Government of Nepal and the Government of India. It is further certified that:

1. The articles have been manufactured in Nepal at a factory situated at _____ (name of place/district) by M/s. ___ (name of the company).

2. The articles involve manufacturing activity in Nepal and that the manufacturing activity satisfies the criteria given in the Protocol to Article V of the Treaty of Trade.

3. The articles in question are not products of third country origin.**  

For His Majesty's Government of Nepal
(Place and date,  Signature and Stamp of Certifying Authority)

**For the purpose of the above Item No. 3,  the articles which have undergone a manufacturing process in Nepal as defined in the Protocol to Article V of the Treaty will not be treated as product of third country origin.  

14. For official use of Indian Customs:
The consignment has been examined and allowed to be imported into India as it complies with the provisions as stipulated under Article V of the Treaty of Trade between His Majesty's Government of Nepal and Government of India.

________________________
Signature and Seal of the
 Certifying Authority.

Dated:
Place:
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C The products worked on or processed as a result of which the total value of materials, parts or produce originating from countries other than India or Nepal or of undetermined origin used -

i) does not exceed seventy five per cent. of the ex-factory price of the articles imported in the time period  beginning from the 6 th day of March,   2002,  and ending on the 5th day of  March, 2003; and
ii) does not exceed seventy per cent. in any subsequent time period , which commences on the 6th day of March in  a given calendar year and ends on the 5th day of March of the subsequent calendar year ;  and
iii) the final process of manufacture is performed in Nepal .

Explanation - For the purpose of this notification, the value of materials, parts or produce originating from countries other than India or Nepal shall be the CIF value at the time of importation of materials, parts or produce, at the point of entry in Nepal, where this can be proven to the satisfaction of the Assistant Commissioner of Customs or Deputy Commissioner of Customs, or the earliest ascertainable price paid for the materials, parts or produce of undetermined origin in  Nepal where the working or processing takes place.  

3.

A The exemption shall apply only to a specified quantity of imports ,   not exceeding    

 i) 100,000 MT in case of Vegetable fats (Vanaspati);
ii)10,000 MT in case of Acrylic Yarn;
iii)7,500 MT in case of Copper products falling under Chapter 74 and heading 85.44 of the First Schedule to the Customs  Tariff Act, 1975(51 of 1975) and
iv)2,500 MT in case of Zinc Oxide , in a time period ,   which shall commence from the 6th day of  March of  a given calendar year and end on the 5th day of March of the succeeding calendar year .

 Illustration: The first time period shall commence on the 6th day of March, 2002 and will end on  the 5th day of March,  2003.               

B. The imports shall be permitted only through the land customs stations at Kakarbhitta/Naxalbari, Biratnagar/Jogbani, Birganj/Raxaul, Bhairwaha/Nautanwa, Nepalgunj/Nepalgunj Road and Mahendranagar/Banbasa.  

C. The importer shall follow the procedure as may be specified by the Government of India from time to time.

2.             This notification shall come into force on the 16th day of April, 2002.  

Vivek Prasd
Under Secretary to the Government of India

F.No 552/25/2002-LC(Pt)