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Other Provisions in Customs Law

September 22nd, 2016

Other Procedures in Customs Including Warehousing


Exemption from customs duty and Project Imports Exemption can be granted by Government by issuing a notification. Capital goods and spares can be imported under ‘project imports’ at concessional/Nil rate of customs duty.
Remission of customs duty Remission can be obtained on goods lost (other than pilferage) in port. No remission after goods are cleared from customs.
Pilferage in port In case of pilferage, no duty is payable. Pilferage should be before order for clearance is made. Duty on pilfered goods is payable by customs authorities.
Relinquishment of title of imported goods Title of imported goods can be relinquished and then no customs duty will be payable. This is ‘remission on relinquished goods’. Title can be relinquished even after imported goods are warehoused.
Abatement if imported goods are in damaged condition If imported goods are in damaged condition, abatement can be obtained in customs duty.
Re-import of exported goods Goods exported can be re-imported. Concessional customs duty is payable on such re-imports, but there are some exemptions.
Demand of customs duty Demand for recovery of customs duty can be made within 6 months. In case of imports by individuals, Government or charitable institutions, show cause notice for demand can be issued within one year. Interest is payable for delayed payment of customs duty.
Recovery of customs duty Recovery procedures are prescribed in section 142 of Customs Act, which has been made applicable to Central Excise also.
Refund of customs duty Refund claim for customs duty can be made within 6 months. In case of imports by individuals, Government or charitable institutions, refund claim can be filed within one year.  Refund would be subject to unjust enrichment provisions.
Prohibition of imports and exports Central Government can prohibit or restrict imports and exports of goods u/s 11 of Customs Act. Besides, there are restrictions under other Acts like FTDR, Ancient Monument Preservation, Environment Control Legislation, Hazardous substances, Arms Act  etc.
Customs House Agent An importer or exporter can transact business of imports and exports either himself or through his employees. However, generally, it is not possible as it requires expertise in procedures. Hence, Customs House Agent (CHA) is usually appointed by importer/exporter. Section 146 of Customs Act provide for licence to persons to carry on business as an agent relating to import or export of goods or entry/departure of conveyance.
Stores Section 2(38) define ‘Stores’ as goods for use in a vessel or aircraft and includes diesel and spare parts and other articles of equipment, whether or not they are required for immediate fitting. The ships/aircrafts coming from abroad require spares and consumables for their ships and hence special provisions have been made. Some stores are exempt from customs duty.


Warehousing in customs


Warehouse to keep imported goods without payment of customs duty Imported goods can be kept in customs warehouse without payment of customs duty. Bond has to be executed while clearing goods from port to warehouse. Warehouse can be public or private.
Warehousing pending receipt of authorisation Goods can be kept in warehouse awaiting receipt of import authorisation or when imported goods are not immediately required for consumption.
Time limit for keeping goods in warehouse Goods can be kept in warehouse upto one year, Extension can be obtained. Interest is payable for warehousing beyond 90 days, @ 15%.
EOU as warehouse EOU is also a ‘warehouse’. Normal warehousing period for them is three years for inputs and five years for capital goods. In case of EOU, interest is payable if warehousing is beyond three years in case of inputs/consumables/spares and five years in case of capital goods.
Manufacture in warehouse Goods can be manufactured in warehouse and exported without payment of customs duty. This facility is useful to EOU.
Clearance from warehouse Warehoused goods cane be (a) Cleared on payment of duty (b) Cleared for export without payment of duty or (c) transferred to another warehouse without payment of duty.


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