payments in case of import

Since Mr.X has purchased from Indian Importer on 'High Sea Sales Basis', he will be required to pay the Customs Duty when the goods arrive on Indian Territory and he will receive the Exchange Control Copy of  Bill of Entry. This will remain same in both the cases whether he makes payment to the the foreign seller in foreign exchange or to the Indian Importer in Indian Rupees.  The CIF Value of Imports of Goods needs to be shown in the Notes to Accounts in both the cases.

Others :
Q 1.  is not clear ? Please elaborate.
Q 2.  Expenditure incurred on money transfer incurred by Mr. X can be debited to Bank Charges / Finance Charges. The same shall be an allowable expenditure for Income Tax purpose also.

The One Says:

If I understand correctly, foreign seller sells goods to importer from whom goods have been purchased by Mr. X. Now, purchased on High Seas Basis means that the goods have not yet arrived in Indian Customs Waters.

Now the question arises who is the importer as per Sec. 2(26) of Customs Act, Importer, in relation to any goods at any time between their importation and the time when they are cleared for home consumption, includes any owner or any person holding himself out to be the importer.

Additional Information required to be given pursuant to Part II of Schedule VI of the Companies Act, 1956 requires disclosure of expenditures in foreign currency and CIF Value of Capital Goods, Raw Materials and Others.

Case 1: Mr. X  is paying in INR to impoter (Only CIF Disclosure & obviously foreign exchange disclosure would not be there)

Case 2: Mr. X is paying directly to foreign seller in USD or other currency (CIF & foreign exchange disclosures)

Whatever expense you incur for business purposes should be allowed in the books provided you have proper documentary evidence to back up your claims.