Custom clerarance

Customs Departments are the government designated authority to implement the policies related to import and export, collect customs duties and facilitate movement of people, goods and cargo into and out of the country.
Area of Operations and Authority

Customs departments have offices at all sea ports, air ports and border gateways which are essentially the exit and entry points for people and cargo movements into and out of the country. Customs agencies are empowered to make arrests, confiscate goods and enjoy powers similar to that of police departments.
Customs and Trade Logistics

Every country annually publishes its policy for Foreign Trade which stipulates the conditions under which goods and services are eligible to be exported or imported. Customs departments implement the provisions of the policy under customs rules, regulations and tariffs. Imports in many countries may be allowed freely or some categories may be permitted with due licenses. Many items are also published as banned for import and not allowed entry into the country. All of the items imported into the country have to be custom cleared. This is applicable to the items brought in as personal effects and also imported by trade and business establishments including governmental and defense agencies. Necessary stipulated duties would have to be paid before the goods are released by Customs. Cargo imported into the country through any point of entry is warehoused at Customs bonded area under customs jurisdiction until it is released after clearance.
Imports and Customs Clearance

Freight Forwarders who co ordinate the international transportation also provide customs clearance services to the clients. The activity is called customs brokerage. Customs clearance work involves preparation and submission of documentations required to facilitate export or imports into the country, representing client during customs examination, assessment, payment of duty and co taking delivery of cargo from customs after clearance along with documents. Some of the documents involved in customs clearance are :

1. Exports Documentation: Purchase order from Buyer, Sales Invoice, Packing List, Shipping bill, Bill of Lading or air way bill, Certificate of Origin and any other specific documentation as specified by the buyer, or as required by financial institutions or LC terms or as per importing country regulations. 2. Imports Documentation: Purchase Order from Buyer, Sales Invoice of supplier, Bill of Entry, Bill of Lading or Air way bill, Packing List, Certificate of Origin, and any other specific documentation required by the buyer, or financial institution or the importing country regulation. Customs Agents prepare the document of Shipping Bills in house for submission while rests of the documents are obtained from the client. Preparing shipping bill involves Classification of cargo under specific classification which is a critical activity in the entire process. Customs clearance agents are also called Carrying and Forwarding agents. They are registered and licensed by Customs to operate. Their role is limited to acting on behalf of and representing clients as third party agencies engaged in customs clearance. Customs Agents are linked through EDI with customs in most of the countries and use documentation software to facilitate entire process.

Custom Clearance of Imported Goods.

Introduction All goods imported into India have to pass through the procedure of customs for proper examination, appraisal, assessment and evaluation. This helps the custom authorities to charge the proper tax and also check the goods against the illegal import. Also it is important to note that no import is allowed in India if the importer doesnt have the IEC number issued by the DFGT. There is no requirement of IEC number if the goods are imported for the personal use. Bill of Entry A Bill of Entry also known as Shipment Bill is a statement of the nature and value of goods to be imported or exported, prepared by the shipper and presented to a customhouse. The importer clearing the goods for domestic consumption has to file bill of entry in four copies; original and duplicate are meant for customs, third copy for the importer and the fourth copy is meant for the bank for making remittances. If the goods are cleared through the EDI system, no formal Bill of Entry is filed as it is generated in the computer system, but the importer is required to file a cargo declaration having prescribed particulars required for processing of the entry for customs clearance. In the non-EDI system along with the bill of entry filed by the importer or his representative the following documents are also generally required:

Signed invoice

Packing list Bill of Lading or Delivery Order/Airway Bill GATT declaration form duly filled in Importers/ CHAs declaration License wherever necessary Letter of Credit/Bank Draft/wherever necessary Insurance document Import license Industrial License, if required Test report in case of chemicals Adhoc exemption order DEEC Book/DEPB in original Catalogue, Technical write up, Literature in case of machineries, spares or chemicals as may be applicable Separately split up value of spares, components machineries Certificate of Origin, if preferential rate of duty is claimed No Commission declaration

Amendment of Bill of Entry Whenever mistakes are noticed after submission of documents, amendments to the bill of entry is carried out with the approval of Deputy/Assistant Commissioner. Green Channel facility Some major importers have been given the green channel clearance facility. It means clearance of goods is done without routine examination of the goods. They have to make a declaration in the declaration form at the time of filing of bill of entry. The appraisement is done as per normal procedure except that there would be no physical examination of the goods. Payment of Duty Import duty may be paid in the designated banks or through TR-6 challans. Different Custom Houses have authorised different banks for payment of duty and is necessary to check the name of the bank and the branch before depositing the duty. Prior Entry for Shipping Bill or Bill of Entry For faster clearance of the goods, provision has been made in section 46 of the Act, to allow filing of bill of entry prior to arrival of goods. This bill of entry is valid if vessel/aircraft carrying the goods arrive within 30 days from the date of presentation of bill of entry. Specialized Schemes Import of goods under specialized scheme such as DEEC and EOU etc is required to execute bonds with the custom authorities. In case failure of bond, importer is required to pay the duty livable on those goods. The amount of bond would be equal to the amount of duty livable on the imported goods. The bank guarantee is also required along with the bond. However, the amount of bank guarantee depends upon the status of the importer like Super Star Trading House/Trading House etc.

Bill of Entry for Bond/Warehousing A separate form of bill of entry is used for clearance of goods for warehousing. Assessment of this bill of entry is done in the same manner as the normal bill of entry and then the duty payable is determined.