In the International trade it has been considered necessary that samples of goods manufactured in one country are sent to another country for being shown or demonstrated for customer appreciation and familiarisation for soliciting orders for goods to be supplied . Accordingly, in November 1952 a convention to facilitate the Importation of Commercial Samples and Advertising Materials was concluded in Geneva. India was party to it and has accepted its recommendation and implemented its provisions through Notifications. 

WHAT ARE SAMPLES 

The Commercial samples are basically the specimens of the goods which are imported by the traders in India to know its characteristics and usage and assess its marketability in India. These samples are also brought by the representatives of Manufacturers abroad to show if to prospective customers in India, to persuade & convince them of the need, efficacy and suitability of these goods for the Indian market. 

WHO CAN SEND/IMPORT 

Samples can be imported by the trade, industry, individuals, Companies, Associations, Research Institutes or Laboratories. These can also be brought by the representatives of manufacturers abroad either as a part of their personal baggage or through post or courier. They can also be sent by manufacturers/ traders abroad to above parties in India. 

WHAT CAN BE SENT 

Samples of all types of goods namely consumer goods, consumer durables or prototypes of engineering goods or goods used in connection with securing export orders can be imported. Similarly, high equipment, machineries, including agricultural machinery and their accessories can also be imported. 

ANY LIMIT? 

The Commercial samples can be imported by bonafide commercial travellers or bonafide trade samples can be imported by Indian Trade and Industry provided the said goods have been supplied free of charge. For charge. For duty free clearance, the value of individual sample should not exceed Rs. 5,000/- and aggregate value should not exceed Rs. 60,000/- per year or 15 units in a year. The prototypes of engineering goods can also be imported even if the value is more than Rs. 5,000/-. Such goods upto Rs. 10,000/- can be imported without payment of duty if the said goods are rendered useless as merchandise by a suitable process. Where the value exceeds Rs. 10,000/-, the said goods are to be re-exported within a period of 9 months or such extended period as Asstt. Commissioner of Customs may allow. High value goods are to be imported by depositing duty with the Customs and giving an undertaking for their re-export within 9 months. The deposited duty is refunded when the machinery is exported back. The following clarification may be necessary on the above guidelines: 

Q.1 What is meant by bonafide sample or bonafide Commercial traveller? How it is determined that the traveller is a bonafide Commercial Traveller? 

A. The purpose of these beneficial notifications is to allow duty free import of genuine Commercial samples into the country. It is not to be used as a means to avoid paying Customs Duty through repeated imports in smaller lost. The bonafide commercial travellers of India or abroad are advised to travel with authorisation from their companies and carry normal trade literature as evidence of the genuineness of their baggage. The said goods, should also be clearly marked as samples. Normally, their passport shows the nature of their repeated travel. The invoices of samples sent from abroad should indicate that these goods are samples. The goods may bear inscription, markings or tags showing them as samples. 

Q.2 Which type of goods can be imported as samples? 

A. All types of goods including Industrial and Agricultural machineries, consumer goods and Consumer durables, white goods are eligible to be imported as samples. However, goods which are prohibited under Foreign Trade (Development and Regulations) Act, 1992 are not allowed to be imported even as samples. The examples of such goods are wild animals, wild animals, wild birds and parts of wild animals and birds, ivory, arms like revolvers and pistols and hand guns and ammunitions and Narcotic drugs. 

Q.3 How is the limit Rs. 60,000/- calculated? 

A. The value of any item imported during a year should not exceed 15 units of the said item or Rs. 60,000/-. However, if more than one product is being imported into the India the value limit is increased proportionately. Similarly, in case samples are consigned to many consignees by one foreign company, but they are being sent at the same time through some Port/ Airport, it shall not be changed to duty if the limit of Rs. 5,000/- per unit each adhered to. The consignments meant for distribution to different parties in India can also be imported together for convenience of transport, if the packets are clearly marked and addressed to different persons in India. The value of Rs. 5,000/- is the export value of the goods excluding locally refundable taxes like VAT in the country of despatch. In case of free samples of Rs. 5000/-, it does not include freight or courier charges. If it is above Rs. 5000/- freight and insurance charges would be added to calculate the duty payable in India. 

Q.4 With reference to which place the value of the goods will be calculated i.e. whether the value is its value in India or abroad? 

A. The value is reckoned to be the value at the place of despatch even in case of third Country goods, the value would be that of the country of despatch. For example, if the goods are manufactured in Tiwan and is being sent from UK as a sample to India, the value in UK is to be taken. However, the cost of freight, postal charges, courier charges are not to be added. 

Q.5 What records are to be maintained by Customs or Importer to show that the person does not exceed the limit of import Rs. 60,000/- 15 units in the year? 

A. Importers are trusted to declare correctly and adhere to the undertaking. However, if any person in suspected to contravene the limit or undertaking deliberately he is liable to be investigated, penalised and/ or prosecuted. 

Q.6 How will a salesman from a foreign country bring in the samples to India? 

A. A commercial traveller of foreign country is eligible for import of bonafide samples if each of the item is not more than Rs. 5,000/- per unit. However, he would not be required to produce his Import Exporter code at the time of clearance of these goods from the Customs. 

Q.7 What other precaution the Indian Commercial Traveller has to take at the time of import of these samples? 

A. The importing executive is to declare that these goods are menat for securing export order or guidance of exporters, and the total value of those goods does not exceed Rs. 60,000/- during 12 months. He also undertakes that he would not sell these goods and if he sells he will pay the duty leviable on those goods. 

Q.8 How the machineries which are costing more than Rs. 5,000/- but below Rs. 10,000/- are defaced to enable them to be brought without payment of duty? 

A. Machinery, which are prototypes of engineering goods, imported either for further manufacturing of the said goods or to be used as capital goods for export production or in connection of securing further export orders can also be imported duty free if the value does not exceed Rs. 10,000/-. The said goods are normally defaced or made unsealable by punching, cracking, marking with indelible ink etc. 

Q.9 How the machineries costing more than Rs. 10,000/- are imported? 

A. Such the goods are always chargeable to duty. The goods are allowed Duty Free Clearance by taking a deposit and an undertaking from the importer that the said goods shall be re-exported within 9 months of import. If the importer does not want to deposit duty he can also give a Bank Guarantee from a reputed bank. The amount of deposit or Bank Guarantee would be 110% of the duties leviable on the goods. 

Q.10 For importation of high value machineries or other high value goods, how much duty is to be deposited and who can deposit the said duty or gives security? 

A. The amount of duty to be deposited would a maximum of 110% of the whole of duties of Customs leviable on the said goods if it is imported by any importer. However, the importer has the option of giving a Bank Guarantee from a reputed bank. Form of the Bank Guarantee is available with the Customs Custom House Agents and with all major banks. The bank guarantee can be given or the deposit can be made by the consignee of the consignor. 

Q.11 What other precaution is taken in case of high Value machinery? 

A. The importer undertakes that the said goods are utilised only for the purpose of demonstration at the place(s) which is declared. The Customs authority may seal the machinery during its journey from the port of importation of the place of demonstration and it is unsealed only at the place of operation or place of demonstration. It is advisable to declare all the likely places of demonstration and contact persons at those places. 

Q.12 What happens if it is not possible to re-export the machinery within 9 months? 

A. The Asstt. Commissioner, Customs is authorised to extend the said period of 9 months for further reasonable period. The importer can also pay the Customs duties leviable at the time of importation and produce import license, if any necessary, to the Asstt. Commissioner Customs at the port of importation to be absolved of his responsibility to re-export the said goods. 

If re-export is likely to be delayed it is advisable to apply to the Asstt. Commissioner for extension of the period in advance. 

Q.13 Whether samples can be imported under any other scheme? 

A. Following Specific provision/ schemes are available or duty free Import which includes samples:

a) 100% Export Oriented Units, Export Processing Zone, Electrical Hardware Technology Park,Software Technology Parks Schemes. With general prior permission samples of all types of goods manufactured by the Units can be imported duty free. 

b) In addition, the Government of India sponsored events for display of Machinery in trade and Industry fairs of the machineries are also allowed Duty Free for the purpose of their exhibition/display/demonstration in India. These machineries are to be imported under Carnet (Notification No. 57/90) dated....... 

c) Similarly, Private Commercial exhibitions are covered under Notification No. 3/89-Cus. where, with certain permissions from the Ministry of Commerce and Indian Trade Promotion Organisation, goods can be imported for display or demonstration. 

d) For promotion of tourism equipment and ancillary goods are allowed Duty Free import under Notification No. 113/57 dated....... 

e) The food stuff imported by foreigners are eligible for Duty Free import. 

f) Import by privileged persons namely diplomats among other, are allowed duty free 

Further reference:
1.  
   Notification No. 154/94-Cus. dt. 13.7.94 
   Notification No. 157/90-Cus. dt. 28.3.90 
   Notification No. 3/89-Cus dt. 9.1.89 
   Notification No.33/57-Cus dt. 22,6.1935 as amended by N.F. 113-Cus dt. 16.5.1952 
   Notification No. 207/89 
   Foreign Trade (Development and Regulation) Act, 1992 issued vide SO No. 1056(E) dt. 31.12.1993 from F. No. 21/11/92-LS of Ministry of Commerce.

For Further enquiry Contact: Nearest Customs Office (hyperlink to Telephone Directory)