Multiple Choice Questions on Customs

1. In India, customs duties are levied on the goods at the rates specified in which of
the following Act –
a. Customs Act, 1962
b. Customs Tariff Act, 1975
c. Central Excise Act, 1944
d. None of the above

2. The duty which is levied on the imported goods, assuming that had it been
manufactured in India, it would have suffered central excise duty is –
a. Special additional duty
b. Countervailing duty
c. Safeguard duty
d. None of the above.
3. The duty which is levied now in replacement of Additional duty or CVD and Special
additional duty on the imported goods along with Basic Customs duty is -
a. Anti dumping duty
b. Value added tax
c. IGST (Integrated tax)
d. None of the above
4. IGST on imported goods came into effect from –
a. 1 January 2017
b. 31 December 2017
c. 1st July 2017
d. None of the above
5. IGST which is levied on the imported goods has a special rate fixed by Government
of India.
a. True
b. False
6. In General, the rates of duty finally applicable on the imported goods has to be
determined with reference to –
a. Merit Rate of duty
b. Effective rate of duty (if applicable)
7. The Exchange rate to be adopted for calculation of Assessable Value of the
imported goods is determined by which of the following factor –
a. Date of filing of the Bill of Entry
b. Date of Assessment of the Bill of entry
c. Date of granting Out of Charge
d. None of the above.
8. The goods are allowed to be cleared for removal by the importer after which of the
following event –
a. Date on which duty is paid
b. Date of Assessment of the Bill of entry
 c. Date on which Out of Charge is given
d. None of the above
9. The document which is filed by the exporter for exporting goods from India to
abroad is
a. Bill of Entry
b. Shipping Bill
c. Import General Manifest
d. Export General Manifest
e. None of the above
10. In terms of Section 110 of the Finance Act, 2018, a duty of customs has been
introduced in replacement of Education cess (2%) and Secondary education cess
(1%) on the goods specified in the first schedule of Customs Tariff Act 1975 to fulfil
the commitment of government to provide finance to education, health and social
security. What is the name of such duty
a. Counter veiling duty
b. Safeguard duty
c. Social welfare surcharge
d. None
11. The percentage of levy of Social welfare surcharge on the goods specified in the
first schedule of Customs Tariff Act 1975 when imported to India is –
a. 5%
b. 7%
c. 1%
d. 10%
e. None
12. The duty which is imposed by Government of India on foreign imports that it
believes are priced below fair market value. Dumping is a process where
a company exports a product at a price lower than the price it normally
charges in its own home market.
a.Safeguard duty
b.Anti dumping duty
c.Counter veiling duty
d.Special additional duty
e.None
13. The duty which is imposed by Government of India due to unexpectedly
increasing imports pose a severe threat to indigenous industry on a
particular good is –
a. Anti dumping duty
b. Basic customs duty
c. Safe guard duty
d. IGST
 e. None
14. Before the introduction of GST/IGST, a duty under Section 3(5) of
Customs Tariff Act,1975 was imposed on such of those goods which
were imported and meant for resale and for which VAT/Central Sales Tax
was paid by the importer. This duty was subsequently refunded by
Customs to the Importer, subject to certain conditions. Name the duty.
a. Counter veiling duty
b. Special Additional duty
c. Safeguard duty
d. None

15. Every Bill of Entry which is filed in Customs goes through the
following process in ICES 1.5 system.
a. Post clearance audit (PCA)
b. Risk Management system (RMS)
c. Ice gate
d. None

16. The basic objective of introducing Risk Management System (RMS)

in Customs is due to the following reasons –
a. To check each and every bill filed with its content
b. To arrest the importer if goods were mis-declared
c. To improve trade facilitatation and to reduce the dwell time so as to
compete in the International arena.
d. None of the above.

17. Under RMS –

a. All the bills are subject to assessment and examination
b. All the bills are subject to only assessment
c. All the bills are subject to only examination.
d. None of the above.
18. What is the expansion of PCA –
a. Post Clearance Audit
b. Previous Clearance Audit
c. Premature Clearance Audit
d. None

19. After the introduction of GST/IGST, the exported goods are also
subject to payment of IGST.
a. True
b. False

20. The Board (CBIC) has the power to fix…………..values for any class
of imported or exported goods and in that event the notified tariff value
shall be the value for the purpose of assessment of duty.
a. Tariff value
b. Ad vela rum
c. Standard rate
d. None

21. The Bill filed for clearance of goods immediately by the importer
after getting OOC from Customs is termed as –
a. Home consumption bill
b. Ex-Bond bill
c. Warehouse bill
d. None

22. The goods which are not immediately required by the importer or
who is unable to pay duty immediately may resort to file which of the
following type of bill –
a. Home consumption bill
b. Ex-Bond bill
c. Warehouse bill
d. None

23. When goods are cleared either fully or partially from the
Warehouse, then the importer is required to file which of the following
type of bill –
a. Home consumption bill
b. Ex-Bond bill
c. Warehouse bill
d. None

24. The incentive which is paid by GOI to exporters to compensate the

cost incurred by them towards customs duty, excise duty for
manufacturing the exported good is
a. Duty credit scrip
b. Duty drawback
c. Refund of duty
d. None

25. The type of drawback granted to the exporters who import and re-
export the goods as it is, is governing by –
a. Section 74 of Duty Drawback Rules.
b. Section 75 of Duty Drawback Rules.

26. The levy of Central Excise duty on imported goods still continues in
respect of which of the following products –
a. Petroleum product/High Speed Diesel
b. Edible oil/vegetables
c. Machinery and Equipments
d. None
27. An importer can import prohibited goods by getting the permission
of customs –
a. True
b. False
28. An importer can import Restricted goods only after getting a licence
from Directorate General of foreign Trade –
a. True
b. False
29. What is the expansion of IEC
a. Import Export Code
b. Indian Europe code
c. None

30. If an Exporter feels that the product which exported by him contains
inputs used for manufacture which are very superior and which deserve
special rates of duty drawback, then he can claim –
a. Duty drawback
b. Incentive from Customs
c. Brand Rate of Duty
d. None

31. A Bill of Entry can be filed within …….. days before arrival of the
vessel.
a. 10 days
b. 20 days
c. 30 days
d. 50 days

32. For classification of goods in Customs, a Global system is followed.

It is –
a. Harmonised System of Nomenclature (HSN)
b. Customs Tariff Act,1975
c. Cross Ruling mechanism
d. None

33. Is the importer required to have a licence for importation of goods?

a. He has to obtain licence for importing any goods from abroad
b. He need not have any licence at all
c. Most of the goods are freely importable except certain restricted goods for
which licence is required.
d. None

34. Who calculates the duty payable in Customs.

a. The Appraising officer
b. The Assistant Commissioner/Dy.Commissioner
c. The EDI System
d. None

35. What is CIF?

a. Carriage inward freight
b. Corporate Indian in Foreign
c. Cost Insurance and Freight
d. None

36. What is FOB value?

a. First on Board value
b. Foreign or Brand value
c. Free on Board value
d. None

37. Goods are provisionally assessed when –

a. Its value declared under self-assessment cannot be determined
immediately.
b. The imported goods has to undergo chemical test or laboratory test
c. when the importer had not submitted necessary documents /information
d. All the above.

38. When goods are imported by an SEZ Unit or Export Oriented Unit,
customs duty is payable at -
a. Fixed 5%
b. As per Customs Tariff Act,1975
c. Fixed 2%
d.No duty is payable.

39. Unscrupulous elements do attempt to evade the duties leviable and

bypass various prohibitions/ restrictions in relation to imports by
attempting to bring the goods into the country from places other than
the notified ports/airports/Land Customs Stations without reporting or
presenting the goods to customs. This activity is called as -
a. Counterfeit goods
b. Smuggling
c. Authorised import
d. None
40. In accordance with section 30 of the Customs Act, 1962 the person
in charge (Master /Agent) of a vessel or an aircraft or a vehicle carrying
imported goods has to deliver a report in electronic form to Customs
through EDI, prior to arrival in the case of a vessel and an aircraft or
within 12 hours of arrival in case of a vehicle in the prescribed form.
This document is called –
a. Bill of Entry
b. Shipping Bill
c. Import General Manifest
d. None
41. According to the amendment brought for Sec.46, an importer has to
file a Bill of entry with customs within …….working day to avoid any
penal charges.
a. 5 days
b. 4 days
c. 3 days
d. 1 day
e. No such condition. He can file as and when he wants.

42. From 1st July, 2017, after the implementation of GST, all import of
goods into India would be treated as inter-state supply. Hence, IGST
would be applicable. Whether input tax credit can be availed for the
IGST and compensation cess paid on the imported goods –
a. Yes
b. No
43. Which one of the following is correct –
a. All the imported consignments are meticulously opened and examined by
customs authorities.
b. 50 per cent are opened and checked by customs authorities.
c. Customs authorities open consignments as per their wish
d. Such of those consignments are opened and examination of goods is
conducted only if such Bill of Entry is marked for Examination by ICES 1.5
system.

44. Which one of the following is correct –

a. All the Bills of Entry which passes through RMS is assessed.
b. 50 per cent are assessed
c. Customs authorities assess bills as per their choice
d. Such of those Bill of Entry which are marked by ICES 1.5 system for
Assessment is only assessed by Appraising officers.

45. All the shipping lines/agents need to furnish an important document

called ………………….. to the Customs electronically before departure of
the Ship or Air craft.
a. Shipping bill
b. Export General Manifest.
c. C Form
None of the above
46. Under Project Imports being an Indian innovation to facilitate setting
up of and expansion of industrial projects, the goods are classified
under which of the following Chapter under Customs Tariff Act 1975
a. Chapter 1
b. Chapter 84 and 85
c. Chapter 98
d. Any of the Chapter.
47. Which of the following statement is incorrect –
a. Prohibited goods cannot be imported into India
b. Restricted goods can be imported with a licence
c. All the goods are not freely importable into India.
d. Prohibited goods can be imported only after getting a licence from DGFT.
48. The power to grant exemption from duty is governed by which of the
following Section of the Customs Act, 1962
a. Section 12
b. Section 46
c. Section 50
d. Section 25
e. None
49. The valuation of imported goods is done under –
a. Section 14
b. Section 18
c. Section 74
d. Section 75
e. None
50. Which of the following statement is correct –
a. After the introduction of GST w.e.f. 1.7.2017, Central Excise duty is
payable on all the imported goods
b. After the introduction of GST w.e.f. 1.7.2017, IGST is payable on all the
imported goods and refund of the same can be obtained.
c. No IGST is payable on the imported goods
d. None
 Answers

1 b 27 B
2 b 28 A
3 c 29 A
4 c 30 C
5 b 31 C
6 b 32 A
7 a 33 C
8 c 34 C
9 b 35 C
10 c 36 C
11 D 37 D
12 D 38 D
13 C 39 B
14 B 40 C
15 B 41 D
16 C 42 A
17 D 43 D
18 A 44 D
19 A 45 B
20 A 46 C
21 A 47 D
22 C 48 D
23 B 49 A
24 B 50 B
25 A
26 A