Clarification needed in clarificatory circular

Importers will now be required to pay service tax on inward ocean freight. They can take Cenvat credit on the basis of a challan evidencing payment of the tax. On import through shipping lines located outside India, they also have an option to pay tax at 1.4 per cent of the goods’ CIF value. The point of taxation will be the date of the bill of lading.

These changes to various rules through three notifications dated April 13 clear many earlier doubts. However, the Central Board of Excise and Customs’ circular of the same date, explaining these changes, has raised new