IMPORT CLEARANCE

PROCEDUREwww.StudsPlanet.com

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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.

• Import is not allowed if the importer doesn’t have the IEC number issued by the DGFT.

• There is no requirement of IEC number if the goods are imported for the personal use.

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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. 

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• 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.

• The Bill of entry, where filed, is to be submitted in a set, different copies meant for different purposes and also given different color scheme, and on the body of the bill of entry the purpose for which it will be used is generally mentioned in the non-EDI declaration. 

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TYPES OF IMPORT

ACTUAL USER

NON- ACTUAL USER

• INDUSTRIAL

• NON-INDUSTRIAL

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IMPORT PROCESS

• What to IMPORT?• From where to IMPORT(Location)• From whom to IMPORT(specified supplier)?• Import contract• IEC no.• Import License• Import finance and clearance

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• WHITE BILL OF ENTRY

HOME CONSUMPTION

• GREEN BILL OF ENTRY

EX-BOND CLEARANCE

• YELLOW BILL OF ENTRY

WAREHOUSING

Types of Bill of Entry

Bills of Entry should be of one of three types.

Out of these, two types are for clearance from customs while third is for clearance from warehouse.

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• This form, called ‘Bill of Entry for Home Consumption’, issued when the imported goods are to be cleared on payment of full duty.

• Home consumption means use within India. It is white colored and hence often called ‘white bill of entry’.

BILL OF ENTRY FOR HOME CONSUMPTION

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• This is used for clearance from the warehouse on payment of duty and is printed on green paper.

• The goods are classified and value is assessed at the time of clearance from customs port.

• Thus, value and classification is not required to be determined in this bill of entry.

• The columns in this bill of entry are similar to other bills of entry. However, declaration by importer is not required as the goods are already assessed

BILL OF ENTRY FOR EX-BOND CLEARANCE

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• If the imported goods are not required immediately, importer may like to store the goods in a warehouse without payment of duty under a bond and then clear from warehouse when required on payment of duty.

• This will enable him to defer payment of customs duty till goods are actually required by him.

• This Bill of Entry is printed on yellow paper and often called ‘Yellow Bill of Entry’. It is also called ‘Into Bond Bill of Entry’ as bond is executed for transfer of goods in warehouse without payment of duty.

BILL OF ENTRY FOR WAREHOUSING

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Please ask if you are not cleared with anything!!!

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• There are two system mainly used for submission of Import Documents.

EDI system– Mainly used in large ports where the system is

upgraded with the help of technology and it makes the things easier.

Non- EDI system– It is used for not so big ports, may be for the less

traffic ports. Thoka Number (Serial Number) is given while noting the Bill of Entry.

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EDI SYSTEM (used in Large ports)

• 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.

• Importer should submit declaration in electronic format to ‘Service Centre’. A signed paper copy of declaration for non-repudiability should be submitted.

• Bill of Entry number is generated by system which is endorsed on printed check list.

• Original documents are to be submitted only at the stage of examination.

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System then generates a B/E Number, which is endorsed on the printed checklist and returned to the importer

SYSTEMAfter verification, the data is submitted to the system by the Service Centre Operator

Checklist is generated For verification of data by the importer

Declaration in electronic formatContaining all the relevant information to the Service Centre

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NON-EDI SYSTEM

• In the non-EDI system the importer has to get the bill of entry noted in the concerned unit which checks the consignment sought to be cleared having been manifested in the particular vessel and a bill of entry number is generated and indicated on all copies.

• After noting the bill of entry gets sent to the appraising section of the Custom House for assessment functions, payment of duty etc.

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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` • Catalogue, Technical write up, Literature in case of

machineries, spares or chemicals as may be applicable

• Packing list • DEEC Book/DEPB in original

• Letter of Credit/Bank Draft/wherever necessary

• Adhoc exemption order

• GATT declaration form duly filled in • Test report in case of chemicals

• Importers/ CHA’s declaration • Industrial License, if required

• License wherever necessary • Import license

• Bill of Lading or Delivery Order/Airway Bill • Insurance document

• No Commission declaration • Separately split up value of spares, components machineries

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Don’t break your head.. Ask me

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After noting/registration of the Bill of entry, it is forwarded manually or electronically to the concerned Appraising Group in the Custom House dealing with the commodity sought to be cleared.

MANUALLY/ ELECTRONICALLY

BILL OF ENTRY

THE CONCERNED GROUP FOR THE

DOCUMENTS

CUSTOM HOUSE

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Thereafter the bill of entry goes to Assistant Commissioner/Deputy Commissioner for confirmation depending upon certain value limits and sent to comptist who calculates the duty amount taking into account the rate of exchange at the relevant date

THE CONCERNED HOUSE SEND THE “BILL OF

ENTRY”

CUSTOM HOUSE

FOR CONFIRMATIONCOMMISSIONER

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After the assessment and calculation of the duty liability the importer’s representative has to deposit the duty calculated with the treasury or the nominated banks, where after he can go and seek delivery of the goods from the custodians

ASSESSMENT OF DUTY

IMPORTER REPRESENTATIVE

BANK(NOMINATED

BANK FOR COLLECTION OF

DUTY)

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The last step is the delivery of goods from the warehouse, Where the goods have already been examined for finalization of classification or valuation no further examination/checking by the dock appraising staff is required at the time of giving delivery and the goods can be taken delivery after taking appropriate orders and payment of dues to the custodians

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You can shoot me with your questions

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Basic document is ‘Entry’

Entry’ in relation to goods means entry made in Bill of Entry, Shipping Bill or Bill of Export

Loading and unloading at specified places only

Imported goods can be unloaded only at specified places. Goods can be exported only from specified places.

Computerisation of customs procedures

Customs procedures are largely computerised. Most of documents have to be e-filed.

Amendment to documents

Documents submitted to customs can be amended with permission In case of bill of entry, shipping bill or bill of export, it can be amended after clearance only on the basis of documentary evidence which was in existence at the time the goods were cleared, warehoused or exported, and not on basis of any subsequent document. [proviso to section 149].

ICD and CFS Imported and export goods are usually handled in containers. These can be stored in Inland Container Depot (ICD) or Container Freight Station (CFS). They function like dry port for handling and temporary storage of imported/export goods and empty containers.

GENERAL PROVISION ABOUT CUSTOM PROCEDURE

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Summary of IMPORT

PROCEDURE

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e-filing of documents Goods should arrive at customs port/airport only. Most of customs procedures are computerised. E-filing of documents is required

Import manifest or Import Report

Person in charge of conveyance’ is required to submit Import Manifest or Import Report.

Bill of Entry for home consumption on payment of customs duty

Importer has to submit Bill of Entry giving details of goods being imported, along with required documents. Electronic submission of documents is done in major ports.White Bill of Entry is for home consumption. Imported goods are cleared on payment of customs duty.

Bill of Entry for warehousing

Yellow Bill of Entry is for warehousing. Duty is not paid and imported goods are transferred to warehouse where these are stored.

Green Bill of Entry is for clearance from warehouse on payment of customs duty. It is for ex-bond clearance.

Noting, examination and assessment

Bill of Entry is noted, Goods are assessed to duty, examined and pre-audit is carried out. Customs duty is paid after assessment.

Out of customs charge order

Goods can be cleared outside port after ‘Out of Customs Charge’ order is issued by customs officer. After that, port dues, demurrage and other charges are paid and goods are cleared.

Demurrage if clearance from port delayed

Demurrage is payable if goods are not cleared from port/airport within three days. Goods can be disposed of if not cleared from port within 30 days.

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INCOTERM

INTERNATIONAL COMMERCIAL TERM

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INCOTERMS serve as a good guide in this regard as they spell out the "critical point" which determines the passing of risk (of loss or damage to the goods) from the Seller to the Buyer.

Commercial Terms are a series of international trade terms that are used are used worldwide to divide the transaction costs and responsibilities between the seller and the buyer and reflect state-of-the-art transportation practices.

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INCOTERMS INCOTERM deal with passing of RISK

and not TITLE over goods or similar issues.

INCOTERM are not a substitute to a full Contract of Sale

INCOTERM do not have force of law unless the Contract of Sale mentions INCOTERMS 2000. For example: FOB (INCOTERM 2000)

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INCOTERM ARE NOT….

the part of the contract for carriage

used to transfer property rights or title

used to name a carrier

used to determine the effect of breach of contract cases

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THANKS… Hope you had a Nice sleep..!!!!