Trade Notice No.14/2010-CE

Dated Shillong, the 24th May,  2010


Attention of Trade, Industry and all concerned are invited that the  Finance Minister has introduced a few amendments to the Finance Bill 2010 in Lok Sabha on 29th April, 2010. A few changes in Excise and  Customs duties have been proposed through Notification Nos. 54/2010-Customs to 56/2010-Customs, 19/2010- Central  Excise (NT), 20/2010-Central Excise to 24/2010-Central Excise, and 23-2010 S.Tax, all dated 29th April, 2010. Changes in rates of duty (unless otherwise stated) have taken effect from the midnight of 28th April/29th April of 2010.

2.         The important changes in respect of Customs & Central Excise Duty  and Service Tax are discussed below:- 


I.                   TOBACCO PRODUCTS:

i.i Excise Duty on hand-rolled cheroots priced upto Rs.3 per stick has been 
      reduced to 10% ad valorem. (Notification No.21-2010 Central Excise refers)

i.ii Additional Excise duty on hand-rolled cheroots priced upto Rs.3 per stick shall
      now be 1.6% ad valorem. (Notification No.23-2010 C.Excise refers)

i.iii Scented supari has been fully exempted from payment of Central Excise Duty.
     (Notification No.21-2010 C.Excise refers) 

II.             PAPER PRODUCTS: 

ii.i Conecessional Rate of 4% Central Excise Duty was applicable on units manufacturing corrugated boxes and cartons from Kraft Paper. Now, this Concessional Rate of Central Excise Duty has been extended to units that manufacture corrugated boxes and cartons from corrugated paper or paperboard. (Notification No.20-2010 C.Excise refers)

ii.ii Excise Duty on waste paper and paper scrap has been reduced to 4% (Notification No.20-2010 C.Excise refers) 

III.             AUTOMOBILES: 

iii.i The ambit of assessment of Automobile components on the basis of their retail sale price, has been expanded to include parts, components and assemblies of earthmoving machinery like loaders, excavators etc. (Notification No.19-2010 C. Excise (NT) refers) 

IV.             SMALL SCALE SECTOR: 

iv.i Excise Duty exemption for small scale units has been extended to all types of materials which are meant for use as packing material by or on behalf of the person whose brand name they bear. (Notification No.24-2010 C.Excise refers)

B.              CUSTOMS

I.                MACHINERY:

i.i Parts and components of tunnel boring machines for use in the assembly of Tunnel boring machines have been fully exempted from Basic Customs Duty (S.No.598 of Notification No.54-2010 Customs refers) 

II.              HEALTH:

ii.i Basic Customs Duty on Ostomy products (Appliances), their Accessories and parts has been reduced to 5%. (S.No.363A of Notification No.54-2010 Customs refers)

ii.ii Basic Customs Duty on 11 specified drugs including two anti-cancer and one for the treatment of AIDS has been reduced to 5% (List 3 of annexure to Notification No.54-2010 Customs refers)

III.             METAL & ORES:

iii.i Basic Customs duty on stainless steel melting scrap has been reduced to 2.5% (S.No.202 of Notification No.54-2010 Customs refers)

iii.ii Export duty on Iron Ore (Lumps) has been increased to 15% Ad valorem. (Notification No.56-2010 Customs refers)


iv.i Specified parts or components required for the manufacture of Optical Disc Drives (ODD) have been exempted from basic customs duty (S.No.604 of Notification No.54-2010 Customs refers) 

V.              MISCELLANEOUS

v.i Acetate rayon tow required for the manufacture of cigarette filter rods has been fully exempted from payment of special CVD of 4% (Notification No.55-2010 Customs refers)

v.ii Flax Fibre has been fully exempted from payment of Basic Customs Duty. (S.No. 436 of Notification No.54-2010 Customs refers)

v.iii Statutory rate of export duty for raw cotton is being enhanced to Rs.10,000    PMT. However, the effective rate of export duty is being maintained at current levels of Rs.2,500/- PMT. For this purpose; an official amendment to the Finance Bill, 2010 has been moved by the Finance Minister and the new statutory rate will be applicable when Finance Act, 2010 is signed by the President of India. 

C.              SERVICE TAX 

I.                   Modular Employable Skill course, approved by the National Council of Vocational Training, by a Vocational Training Provider registered under the Skill Development initiative Scheme with the Directorate General of Employment and Training, Ministry of Labour and Employment, Government of India, have been exempted from the whole of the service tax. (Service as per Section 65 (105) (zzc)  of Finance Act, 1994) (Notificatin No.23/2010-Service Tax refers). However, other course conducted by such vocational training providers would continue to attract Service Tax.

3.         The relevant Notifications can be downloaded directly from in case of any doubt or difficulty, I would request you to bring it immediately either to my notice or to the notice of Shri Yogendra Garg, Director TRU, (Tel No.011-23092236; e-mail or Ms Limatula Yaden, Deputy Secretary, TRU (Tel No. 011-23092753;


 (Hemant A Bhat)



Authority: Letter dated 29th April 2010

                 Issued by Govt. of India Ministry of Finance

                 Department of Revenue, Tax Research Unit                    

                 New Delhi, under D.O.F.No. B-1/22/2010-TRU