Import goods free of cost

This query is : Resolved

PIYUSH JAIN (Querist)
Follow

17 July 2012 my company purchase 1 item from china & seller charge price of 2 item after all settlements with custom and foreign transfer we realize our mistake and seller provide those 1 item free of cost
what is remedy and accounting treatment of those transaction.

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
Follow

18 July 2012 GENERALLY import of any goods, whether imported free of cost or on payment, would attract normal applicable customs duties. The same principle would hold good for import of goods received as replacement where duty would have to be paid irrespective of the fact as to whether the goods are imported for a price or whether the goods are imported free of cost as warranty replacement. This legal position has been upheld by the Tribunal in the case of New Vedio Limited Vs Commissioner of Customs, New Delhi, 1996 (87) ELT 509. It is well settled position in Central Excise also that goods removed from factory as replacement, whether free of cost or for a price, would attract excise duty.

PIYUSH JAIN

PIYUSH JAIN (Querist)
Follow

19 July 2012 thanks for the above
sir i want to know about the accounting treatment of purchase and govt query about payment of goods

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now