MM TAX CLUB

Instruction No. 02/2024-Customs dated February 15, 2024

The undersigned is directed to draw your attention to Board's Instruction No. 19/2018-Customs dated November 22, 2018 from F.No. 394/107/2018 Commr (Inv.-Cus.) which prescribed formats for informing arrest (Annexure I) or other incident (Annexure II). Subsequent instruction dated October 05, 2021 had reminded for timely reporting, while communication dated August 03, 2022 had directed sharing of reports with the DG, ARM.

A review of databases and email communications received thus far indicates that Annexure II incidents are not being shared by numerous Zones. The sharing by certain Zones is sporadic. The reported Annexure-I or II, many times contain description/detail that is insufficient as input for enhanced risk profiling. It is noted that the collection and integration of a proper database is very much required for the purpose of prevention of smuggling through early detection of entities involved and by understanding their adjusting modus operandi. The expeditious up-dating of database is imperative for achieving the optimum risk based targeting across Zones (i.e. nationally). This agility nullifies tactics that syndicates adopt across Zones or modes of carriage or routes.

Keeping the above in view, revised Annexure-1 (intimation of arrest) and revised Annexure- II (incident report where arrest is not made) formats are enclosed. A guide on how to fill the format is being provided to bring uniformity in nature of data. The reporting is to be made only by email and simultaneously to the addresses which are shown on these formats.

The intimation of arrest (revised Annexure-I) shall continue to be sent by the Chief Commissioner/Director General through email within 24 hours of the arrest of an individual.

The Board notes that incidents are cases (under the Customs Act 1962 that are related to outright smuggling and commercial frauds) with which every jurisdictional Commissioner is expected to be up to date. The incident report where arrest is not made (revised Annexure-II) has, from the beginning, sought to capture description/details that are usually routinely collected and reported to senior officers within a Commissionerate in near real-time basis.

For example, if there is a batch or shift or roster based schedule of working, incidents are being brought to notice within the Commissionerate in line with such schedule. In other instances, the incidents are being brought to notice of senior officers normally on the same or next day. Therefore, for timely reporting, the Board prescribes that whenever such incidents arise, the Commissioner/ADG shall immediately email the Annexure-II to the Board and other addressees. Each Commissioner must ensure that his/her internal proformae for bringing to notice such incidents are aligned to suit the reporting to be made to the Board. The Chief Commissioners are requested to ensure strict compliance of this instruction in their respective Zone.

THE FINANCE ACT, 2024 enacted by Parliament in the Seventy-fifth Year of the Republic of India, said act received assent of the President on the 15th February, 2024 and is hereby published for general information.

An Act to continue the existing rates of income-tax for the financial year 2024-2025 and to provide for certain relief to taxpayers and to make amendments in certain enactments

Save as otherwise provided in this Act,––

(a) sections 2 to 10 shall come into force on the 1st day of April, 2024;

(b) sections 11 to 13 shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

It has come to the notice of Reserve Bank of India that a Card Network had an arrangement that enables businesses to make card payments through certain intermediaries, to entities that do not accept card payments.

2. Under this arrangement, the intermediary accepts card payments from corporates for their commercial payments and then remits the funds via IMPS/RTGS/NEFT to non-card accepting recipients.

3. On closer scrutiny, it was observed that this arrangement qualified as a payment system. Under the provisions of Payment and Settlement Systems (PSS) Act, 2007, such payment system requires authorization under Section 4 of PSS Act, which has not been obtained in the instant case. The activity was, therefore, without legal sanction.

4. The arrangement has also raised following concerns:

1. The intermediary in the above arrangement pooled large amount of funds into an account which is not a designated account under PSS Act.
2. Transactions processed under this arrangement did not comply with the originator and beneficiary information requirements, as stipulated under Master Direction on KYC issued by the Reserve Bank.

5. As per information available, only one card network has operationalized this arrangement in the country so far.

6. As the matter is under detailed examination, the Card Network has been advised to keep all such arrangements under abeyance, till further orders. It is clarified that the Reserve Bank has not placed any restriction with respect to normal usage of business credit cards.

 Reserve Bank of India and Nepal Rastra Bank today signed and exchanged Terms of Reference for integration of fast payment systems of India and Nepal, viz., Unified Payments Interface (UPI) of India and National Payments Interface (NPI) of Nepal, respectively. The integration is aimed at facilitating cross-border remittances between India and Nepal by enabling users of the two systems to make instant, low-cost fund transfers.

2. The collaboration between India and Nepal in linking their fast payment systems through the UPI-NPI linkage will further deepen financial connectivity and reinforce the enduring historical, cultural, and economic ties between the two countries.

3. Based on the Terms of Reference exchanged between RBI and NRB, the necessary systems will be put in place for interlinking of UPI and NPI. The formal launch of the linkage i.e., commencement of operations will be done at a later date.