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FOB vs CIF (Custom)

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This query is : Resolved

Author : Anonymous

( Author )
06 January 2011

Dear Experts

Can anyone explain the difference between FOB / CIF. How they assessable value.


Nitin

( Expert )
06 January 2011

FOB(Free 0n B0ard) value in simple terms you can say is the product price whereas CIF (Cost ,Insurance & Freight)value includes in addition to Cost price ,the insurance part & freight part also to the destination ,if you are talking about Customs valuations rules it is always CIF value ,in fact to the CIF value 1% landing charges also to be added for custom duty calculation purpose.


Manmohan ACA, CS

( Expert )
06 January 2011

Completely agree
for custom valuation
for import take CIF + 1% landing charges
For export take i.e. Charge duty on FOB value


RAMESH KUMAR VERMA

( Expert )
07 January 2011

thanks experts,

FOB and CIF are the most two popular price terms of INCO TERMS, defined by ICC to harmonize the possible dispute of arising form the international trade practice.
FOB (Free On Board): Term of sale under which the price invoiced or quoted by a seller includes all charges up to placing the goods on board a ship at the port of departure specified by the buyer. Also called collect freight, freight collect, or freight forward.

CIF (Cost, Insurance & Freight): Term of sale signifying that the price invoiced or quoted by a seller includes insurance and all other charges up to the named port of destination. In comparison, carriage and insurance paid to (CIP) terms include insurance and all charges up to a named place in the country of destination (usually the buyer's warehouse). See also cost and freight (C&F, or CFR). The difference between CIF and CFR is the insurance during the transportation.

for more info:- read foreign trade policy 2010-2011


RAMESH KUMAR VERMA

( Expert )
10 January 2011

thanks pyne ji ,

dear anonymous,

u can also put up your any queries in this forum eminent experts will assist you.

thanks



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