Section 3 of The International Finance Corporation (Status, Immunities and Privileges) Act, 1958
- (1)Notwithstanding anything to the contrary contained in any other law, the provisions of the Agreement set out in the Schedule shall have the force of law in India: Provided that nothing in Section 9 of Article VI of the Agreement shall be construed as--
- (a)entitling the Corporation to import into India goods free of any duty of customs without any restriction on their subsequent sale therein; or
- (b)conferring on the Corporation any exemption from duties or taxes which form part of the price of goods sold; or
- (c)conferring on the Corporation any exemption from duties or taxes which are in fact no more than charges for services rendered.
- (2)The Central Government may, from time to time, by notification in the Official Gazette, amend the Schedule in conformity with any amendments, duly made and adopted, of the provisions of the Agreement set out therein: Provided that any notification issued under this sub-section shall be laid for not less than thirty days before each House of Parliament as soon as may be after it is issued and shall be subject to such modifications as Parliament may make during the session in which it is so laid or the session immediately following.
Summary
- The provisions of the Agreement set out in the Schedule have the force of law in India, even if other laws say otherwise.
- The Corporation is not allowed to import goods into India free of customs duty if there are no restrictions on selling those goods later.
- The Corporation does not get tax exemptions on duties or taxes that are built into the price of goods sold.
- The Corporation is not exempt from paying taxes or duties that are actually just fees for services rendered.
- The Central Government can update the Schedule through a notification in the Official Gazette to match any adopted amendments of the Agreement.
- Any update to the Schedule must be presented to each House of Parliament for at least thirty days, and Parliament can modify or change it during that session or the next one.
Practical examples
FAQ
1. Do the provisions in the Schedule have the force of law even if they conflict with other Indian laws?
Yes, they have the force of law notwithstanding anything to the contrary contained in any other law.
2. Does the Corporation have to pay for services rendered, or is it exempt from those charges?
The Corporation is not exempt from duties or taxes which are in fact no more than charges for services rendered.
3. How can the Central Government amend the Schedule of the Act?
The Central Government can amend the Schedule by notification in the Official Gazette to match amendments made to the Agreement.
4. What is the parliamentary procedure when the Central Government amends the Schedule?
The notification must be laid before each House of Parliament for at least thirty days, and it is subject to modifications that Parliament may make during that session or the next session.
Test yourself
Q1.Under Section 3, what is the status of the Agreement provisions set out in the Schedule?
Q2.Which tax exemption is the Corporation explicitly denied under Section 3?
Q3.What restriction applies to the Corporation importing goods free of customs duty?
Q4.Is the Corporation exempt from charges that are simply fees for services rendered?
Q5.For how many days must a notification amending the Schedule be laid before each House of Parliament?
Q6.During which sessions of Parliament can modifications be made to an issued amendment notification?