Levy of additional duty equal to excise duty, sales tax, local taxes and other charges
Section 3 of the Customs Tariff Act, 1975 deals with levy of additional duty equal to excise duty, sales tax, local taxes and other charges. Any article which is imported into India shall, in addition, be liable to a duty (hereafter in this section referred to as the additional duty) equal to the excise duty for the time being leviable on a like article if produced or manufactured in India and if such excise duty on a like article is lev The Act came into force on 02 Aug 1976.
1[3. Levy of additional duty equal to excise duty, sales tax, local taxes and other charges--(1) Any article which is imported into India shall, in addition, be liable to a duty (hereafter in this section referred to as the additional duty) equal to the excise duty for the time being leviable on a like article if produced or manufactured in India and if such excise duty on a like article is leviable at any percentage of its value, the additional duty to which the imported article shall be so liable shall be calculated at that percentage of the value of the imported article:
Provided that in case of any alcoholic liquor for human consumption imported into India, the Central Government may, by notification in the Official Gazette, specify the rate of additional duty having regard to the excise duty for the time being leviable on a like alcoholic liquor produced or manufactured in different States or, if a like alcoholic liquor is not produced or manufactured in any State, then, having regard to the excise duty which would be leviable for the time being in different States on the class or description of alcoholic liquor to which such imported alcoholic liquor belongs.
Explanation--In this sub-section, the expression the excise duty for the time being leviable on a like article if produced or manufactured in India means the excise duty for the time being in force which would be leviable on a like article if produced or manufactured in India or, if a like article is not so produced or manufactured, which would be leviable on the class or description of articles to which the imported article belongs, and where such duty is leviable at different rates, the highest duty.
(2) For the purpose of calculating under sub-sections (1) and (3), the additional duty on any imported article, where such duty is leviable at any percentage of its value, the value of the imported article shall, notwithstanding anything contained in section 14 of the Customs Act, 1962 (52 of 1962), be the aggregate of --
(i) the value of the imported article determined under sub-section (1) of section 14 of the Customs Act, 1962 (52 of 1962) or the tariff value of such article fixed under sub-section (2) of that section, as the case may be; and of 1962), and any sum chargeable on that article under any law for the time being in force as an addition to, and in the same manner as, a duty of customs, but does not include--
(ii) any duty of customs chargeable on that article under section 12 of the Customs Act, 1962 (52 of 1962), and any sum chargeable on that article under any law for the time being in force as an addition to, and in the same manner as, a duty of customs, but does not include--
2[(a) the duty referred to in sub-sections (1), (3), (5), (7) and (9)];
(b) the safeguard duty referred to in sections 8B and 8C;
(c) the countervailing duty referred to in section 9; and
(d) the anti-dumping duty referred to in section 9A:
3 [Provided that in case of an article imported into India,--
(a) in relation to which it is required, under the provisions of the 4[Legal Metrology Act, 2009 (1 of 2010)] or the rules made thereunder or under any other law for the time being in force, to declare on the package thereof the retail sale price of such article; and
(b) where the like article produced or manufactured in India, or in case where such like article is not so produced or manufactured, then, the class or description of articles to which the imported article belongs, is--
(i) the goods specified by notification in the Official Gazette under subsection (1) of section 4A of the Central Excise Act, 1944 (1 of 1944), the value of the imported article shall be deemed to be the retail sale price declared on the imported article less such amount of abatement, if any, from such retail sale price as the Central Government may, by notification in the Official Gazette, allow in respect of such like article under sub-section (2) of section 4A of that Act; or
5 * * * * *
Explanation--Where on any imported article more than one retail sale price is declared, the maximum of such retail sale price shall be deemed to be the retail sale price for the purposes of this section.]
6 [Provided further that in the case of an article imported into India, where the Central Government has fixed a tariff value for the like article produced or manufactured in India under sub-section (2) of section 3 of the Central Excise Act, 1944 (1 of 1944), the value of the imported article shall be deemed to be such tariff value.]
Explanation--Where on any imported article more than one retail sale price is declared, the maximum of such retail sale price shall be deemed to be the retail sale price for the purposes of this section.
(3) If the Central Government is satisfied that it is necessary in the public interest to levy on any imported article [whether on such article duty is leviable under sub-section (1) or not] such additional duty as would counter-balance the excise duty leviable on any raw materials, components and ingredients of the same nature as, or similar to those, used in the production or manufacture of such article, it may, by notification in the Official Gazette, direct that such imported article shall, in addition, be liable to an additional duty representing such portion of the excise duty leviable on such raw materials, components and ingredients as, in either case, may be determined by rules made by the Central Government in this behalf.
(4) In making any rules for the purposes of sub-section (3), the Central Government shall have regard to the average quantum of the excise duty payable on the raw materials, components or ingredients used in the production or manufacture of such like article.
(5) If the Central Government is satisfied that it is necessary in the public interest to levy on any imported article [whether on such article duty is leviable under sub-section (1) or, as the case may be, sub-section (3) or not] such additional duty as would counter-balance the sales tax, value added tax, local tax or any other charges for the time being leviable on a like article on its sale, purchase or transportation in India, it may, by notification in the Official Gazette, direct that such imported article shall, in addition, be liable to an additional duty at a rate not exceeding four per cent. of the value of the imported article as specified in that notification.
Explanation--In this sub-section, the expression sales tax, value added tax, local tax or any other charges for the time being leviable on a like article on its sale, purchase or transportation in India means the sales tax, value added tax, local tax or other charges for the time being in force, which would be leviable on a like article if sold, purchased or transported in India or, if a like article is not so sold, purchased or transported, which would be leviable on the class or description of articles to which the imported article belongs, and where such taxes, or, as the case may be, such charges are leviable at different rates, the highest such tax or, as the case may be, such charge.
(6) For the purpose of calculating under sub-section (5), the additional duty on any imported article, the value of the imported article shall, notwithstanding anything contained in sub-section (2), or section 14 of the Customs Act, 1962 (52 of 1962), be the aggregate of--
(i) the value of the imported article determined under sub-section (1) of section 14 of the Customs Act, 1962 (52 of 1962) or the tariff value of such article fixed under sub-section (2) of that section, as the case may be; and
(ii) any duty of customs chargeable on that article under section 12 of the Customs Act, 1962, (52 of 1962), and any sum chargeable on that article under any law for the time being in force as an addition to, and in the same manner as, a duty of customs, but does not include--
7 [(a) the duty referred to in sub-sections (5), (7) and (9);]
(b) the safeguard duty referred to in sections 8B and 8C;
(c) the countervailing duty referred to in section 9; and
(d) the anti-dumping duty referred to in section 9A.
8 [(7) Any article which is imported into India shall, in addition, be liable to integrated tax at such rate, not exceeding forty per cent. as is leviable under section 5 of the Integrated Goods and Services Tax Act, 2017 on a like article on its supply in India, on the value of the imported article as determined under sub-section (8) 9[or sub-section (8A), as the case may be].
(8) For the purposes of calculating the integrated tax under sub-section (7) on any imported article where such tax is leviable at any percentage of its value, the value of the imported article shall, notwithstanding anything contained in section 14 of the Customs Act, 1962 (52 of 1962), be the aggregate of--
(a) the value of the imported article determined under sub-section (1) of section 14 of the Customs Act, 1962 (52 of 1962) or the tariff value of such article fixed under sub-section (2) of that section, as the case may be; and
(b) any duty of customs chargeable on that article under section 12 of the Customs Act, 1962 (52 of 1962), and any sum chargeable on that article under any law for the time being in force as an addition to, and in the same manner as, a duty of customs, but does not include the tax referred to in sub-section (7) or the cess referred to in sub-section (9).
10[(8A) Where the goods deposited in a warehouse under the provisions of the Customs Act, 1962 (52 of 1962) are sold to any person before clearance for home consumption or export under the said Act, the value of such goods for the purpose of calculating the integrated tax under sub-section (7) shall be,--
(a) where the whole of the goods are sold, the value determined under sub-section (8) or the transaction value of such goods, whichever is higher; or
(b) where any part of the goods is sold, the proportionate value of such goods as determined under sub-section (8) or the transaction value of such goods, whichever is higher:
Provided that where the whole of the warehoused goods or any part thereof are sold more than once before such clearance for home consumption or export, the transaction value of the last such transaction shall be the transaction value for the purposes of clause (a) or clause (b):
Provided further that in respect of warehoused goods which remain unsold, the value or the proportionate value, as the case may be, of such goods shall be determined in accordance with the provisions of sub-section (8).
Explanation-- For the purposes of this sub-section, the expression "transaction value", in relation to warehoused goods, means the amount paid or payable as consideration for the sale of such goods.]
(9) Any article which is imported into India shall, in addition, be liable to the goods and services tax compensation cess at such rate, as is leviable under section 8 of the Goods and Services Tax (Compensation to States) Cess Act, 2017 on a like article on its supply in India, on the value of the imported article as determined under sub-section (10) 11c9560or sub-section (10A), as the case may be].
(10) For the purposes of calculating the goods and services tax compensation cess under sub-section (9) on any imported article where such cess is leviable at any percentage of its value, the value of the imported article shall, notwithstanding anything contained in section 14 of the Customs Act, 1962 (52 of 1962), be the aggregate of--
(a) the value of the imported article determined under sub-section (1) of section 14 of the Customs Act, 1962 or the tariff value of such article fixed under sub-section (2) of that section, as the case may be; and
(b) any duty of customs chargeable on that article under section 12 of the Customs Act, 1962, and any sum chargeable on that article under any law for the time being in force as an addition to, and in the same manner as, a duty of customs, but does not include the tax referred to in sub-section (7) or the cess referred to in sub-section (9).
11 [(10A) Where the goods deposited in a warehouse under the provisions of the Customs Act, 1962 (52 of 1962) are sold to any person before clearance for home consumption or export under the said Act, the value of such goods for the purpose of calculating the goods and services tax compensation cess under sub-section (9) shall be,--
(a) where the whole of the goods are sold, the value determined under sub-section (10) or the transaction value of such goods, whichever is higher; or
(b) where any part of the goods is sold, the proportionate value of such goods as determined under sub-section (10) or the transaction value of such goods, whichever is higher:
Provided that where the whole of the warehoused goods or any part thereof are sold more than once before such clearance for home consumption or export, the transaction value of the last of such transaction shall be the transaction value for the purposes of clause (a) or clause (b):
Provided further that in respect of warehoused goods which remain unsold, the value or the proportionate value, as the case may be, of such goods shall be determined in accordance with the provisions of sub-section (10).
Explanation--For the purposes of this sub-section, the expression transaction value, in relation to warehoused goods, means the amount paid or payable as consideration for the sale of such goods.]
(11) The duty or tax or cess, as the case may be, chargeable under this section shall be in addition to any other duty or tax or cess, as the case may be, imposed under this Act or under any other law for the time being in force.
(12) The provisions of the Customs Act, 1962 (52 of 1962) and the rules and regulations made thereunder, including those relating to drawbacks, refunds and exemption from duties shall, so far as may be, apply to the duty or tax or cess, as the case may be, chargeable under this section as they apply in relation to the duties leviable under that Act.]
Section 3, The Customs Tariff Act, 1975 (Act 51 of 1975).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
- Central Excise Act s. 3 Duty specified in the Fourth Schedule to be levied
- Central Excise Act s. 4A Valuation of excisable goods with reference to retail sale price
- s. 8B Power of Central Government to apply safefuard measures
- s. 8C [Omitted.]
- s. 9 Countervailing duty on subsidized articles
- s. 9A Anti-dumping duty on dumped articles
Referred to by 60
- Andhra Pradesh Goods and Services Tax Act s. 38 Furnishing details of inward supplies
- Andhra Pradesh Goods and Services Tax Act s. 42 Matching, reversal and reclaim of input tax
- Arunachal Pradesh Goods and Services Tax Act s. 38
- Arunachal Pradesh Goods and Services Tax Act s. 42
- Arunachal Pradesh Goods and Services Tax Act s. 38 Furnishing details of inward supplies
- Arunachal Pradesh Goods and Services Tax Act s. 42 Matching, reversal and reclaim of input tax credit
- Assam Goods and Services Tax Act s. 38
- Assam Goods and Services Tax Act s. 42
- Bihar Goods and Services Tax Act s. 125
- Bihar Goods and Services Tax Act s. 140
- Central Excise Act s. 3A Power of Central Government to charge excise duty on the basis of capacity of production in respect of notified goods
- Central Goods and Services Tax (Amendment) Act s. 28
and 48 more
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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C. C. E. Nagpur vs Empress Mills (mstc) Nagpur
Court's Decision & Legal Precedent
Where a statutory notification creates a legal fiction deeming certain goods as duty-paid even without documentary evidence of actual payment, such fiction must be given its due play and taken to its logical conclusion. The Explanation II to Notification Nos. 14/2002-CE and 15/2002-CE creates such a legal fiction for textile yarns and fabrics, implementing the Government's policy choice in Budget 2002 to provide complete exemption to manufacturers not availing CENVAT credit. Therefore, manufacturers of knitted garments are entitled to exemption when manufacturing from knitted fabrics (deemed duty-paid under Explanation II) without producing documentary proof of duty payment, provided they satisfy the condition of non-availment of CENVAT credit.
On this section: Additional duty of Customs leviable for imported goods used in manufacturing
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C. C. E. , Ahmedabad vs Aravind Mills LTD
Court's Decision & Legal Precedent
CENVAT credit on inputs used for generation of electricity is admissible only to the extent that the electricity generated is used within the factory of production for manufacture of final products or any other purpose within the factory. To the extent excess electricity is cleared outside the factory to joint ventures, vendors, or grid at contractual rates (i.e., sold for a price), the integral connection between the process of electricity generation and the manufacture of final products ceases, and proportionate CENVAT credit attributable to such wheeled-out electricity must be reversed. The definition of 'input' under Rule 2(g) of CENVAT Credit Rules 2002 has three essential parts - specific part, inclusive part, and place of use - all of which must be satisfied for an input to qualify for credit, and the fundamental requirement that inputs must be 'used in or in relation to the manufacture of final products' cannot be set aside regardless of how the definition is structured.
On this section: Additional duty equivalent to excise duty under customs law
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Union of India vs Mohit Minerals Pvt. LTD
Court's Decision & Legal Precedent
While the impugned notifications are validly issued under Sections 5(3) and 5(4) of the IGST Act and the importer can be deemed the recipient of shipping services under Section 13(9) read with Section 2(93)(c) of the CGST Act, the separate levy of IGST on the service component of CIF contracts violates the principle of composite supply enshrined in Section 2(30) read with Section 8 of the CGST Act. Since the Indian importer is liable to pay IGST on the composite supply comprising goods and services of transportation and insurance, a separate levy on the service component would be in violation of the scheme of GST legislation.
On this section: Valuation of imported goods including freight component for customs duty purposes
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Hillman Woolen CO vs Union of India
Court's Decision & Legal Precedent
An exemption notification under the Customs Act that enlarges the scope of an earlier exemption notification by including a new duty introduced after the original notification cannot be treated as retrospective merely because the underlying international treaty predates the new duty. A notification is clarificatory only if the earlier notification remotely suggested the exemption. When a new duty is introduced by statute after a treaty is signed, a subsequent notification granting exemption from that new duty is prospective in operation and does not retroactively apply to periods before the notifying act, unless the notification explicitly provides for retrospectivity or there is clear evidence of rectification of a proven mistake or omission. The Customs Act, 1962 and the Customs Tariff Act, 1975 are independent statutes with independent duty regimes; basic customs duty, additional duty equal to excise duty, and special additional duty are three distinct levies under Sections 2, 3 and 3A respectively.
On this section: Provides for levy of additional duty equal to excise duty on imported articles; distinguished from basic customs duty under Schedule I and from SAD under Section 3A
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… The issue is whether the transaction is an import of goods under customs law, but a supply of service under GST law; - (b) Section 5(1) of the IGST Act is the charging section. The proviso to Section 5(1) states that integrated tax on goods imported into India shall be levied and collected in accordance with Section 3 of the Customs Tariff Act on the value as determined under the Customs Tariff Act and at the point when duties of customs are levied under Section 12 of the Customs Act; - (c) Section 3(7) of the Customs Tariff Act provides that any article imported into India shall, in addition, be liable to integrated tax; - …
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… The issue is whether the transaction is an import of goods under customs law, but a supply of service under GST law; - (b) Section 5(1) of the IGST Act is the charging section. The proviso to Section 5(1) states that integrated tax on goods imported into India shall be levied and collected in accordance with Section 3 of the Customs Tariff Act on the value as determined under the Customs Tariff Act and at the point when duties of customs are levied under Section 12 of the Customs Act; - (c) Section 3(7) of the Customs Tariff Act provides that any article imported into India shall, in addition, be liable to integrated tax; - …
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… The issue is whether the transaction is an import of goods under customs law, but a supply of service under GST law; - (b) Section 5(1) of the IGST Act is the charging section. The proviso to Section 5(1) states that integrated tax on goods imported into India shall be levied and collected in accordance with Section 3 of the Customs Tariff Act on the value as determined under the Customs Tariff Act and at the point when duties of customs are levied under Section 12 of the Customs Act; - (c) Section 3(7) of the Customs Tariff Act provides that any article imported into India shall, in addition, be liable to integrated tax; - (d) …
Questions about Section 3
What have the courts held on Section 3 of the Customs Tariff Act?
C. C. E. Nagpur vs Empress Mills (mstc) Nagpur (04 Mar 2016) is the leading judgment on this section among those set out below: Additional duty of Customs leviable for imported goods used in manufacturing. Another 3 judgments on this section are set out below, all of them from the Supreme Court. They run from 2009 to 2022.
How do I find court cases under Section 3 of the Customs Tariff Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Customs Tariff Act 1975 3, section 3 Customs Tariff Act 1975, section 3 of the Customs Tariff Act. People searching for it also type customs tariff act schedule 3. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 4 reported judgments on this section are set out on this page, beginning with C. C. E. Nagpur vs Empress Mills (mstc) Nagpur (04 Mar 2016).
What should I read with Section 3 of the Customs Tariff Act, and has it changed?
Its own text turns on Central Excise Act 3 (Duty specified in the Fourth Schedule to be levied), Central Excise Act 4A (Valuation of excisable goods with reference to retail sale price), section 8B (Power of Central Government to apply safefuard measures), section 8C ([Omitted.]), and on 2 further provisions, so none of them can safely be read on its own. 60 other provisions in this corpus refer back to it.
When did Section 3 of the Customs Tariff Act come into force?
Section 3 of the Customs Tariff Act, cited as Customs Tariff Act 1975 3, came into force on 02 Aug 1976, having been enacted on 18 Aug 1975. It is in force as at the date shown on this page.
Other sections of this Act
- 9A. Anti-dumping duty on dumped articles1721 words
- 9. Countervailing duty on subsidized articles1425 words
- 8B. Power of Central Government to apply safefuard measures1186 words
- 9B. NO levy under section 9 or section 9A in certain cases512 words
- 9C. Appeal361 words
- 6. Power of Central Government to levy protective duties in certain cases323 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 14 Oct 2026. This page is not a substitute for legal advice.