India Customs Manual 2023, unclaimed/uncleared goods
We have filed Bill of entry for our import clearance. But later faced financial problem and could not customs clear the cargo. How does Indian Customs handle such un cleared goods?
We could not customs clear our imported goods after arriving at Indian port due to lack of demand for goods. What is the process undertaken by Customs in India against such uncleared cargo?
Do customs calculated import duty on unclaimded or uncleared goods in India?
Does Indian Customs recover import duty and other dues against uncleared cargo or unclaimed cargo in India?
What are the Legal provisions involved in India to customs clearance under unclaimed cargo and uncleared cargo?
What are the Procedure for sale of unclaimed/uncleared goods as per Indian Customs Manual 2023?
How does India customs handle Disposal of hazardous waste against unclaimed goods or uncleared goods?
What are the Compliance with restrictions/prohibitions under various laws under handling uncleared goods and unclaimed goods in India?
What are the process by Indian customs on Mechanism for interaction between custodians and Customs.
Chapter 20 of Indian customs manual 2023 details about the Disposal of Unclaimed goods and Uncleared Cargo in India.
Indian customs manual 2023 elaborates the guidelines about the procedures and formalities to handle unclaimed goods and uncleared goods. The details include Legal provisions in handling unlceared cargo and unclaimed cargo, Procedure for sale of unclaimed/uncleared goods, Disposal of hazardous waste in unclaimed or uncleared goods, Compliance with restrictions/prohibitions under various laws under unclaimed goods and uncleared cargo and Mechanism for interaction between custodians and Customs on uncleared/unclaimed cargo.
Legal provisions
Procedure for sale of unclaimed/uncleared goods
Disposal of hazardous waste
Compliance with restrictions/prohibitions under various laws
Mechanism for interaction between custodians and Customs
The extract of Chapter 20 of Indian Customs Manual 2023 updated till 31st December, 2022 is stated under:
Chapter 20: Disposal of Unclaimed/Uncleared Cargo, Indian Customs Manual 2023
1. Introduction:
1.1 Imported goods are allowed to be cleared for home consumption by the Customs, if there are no
restrictions or prohibitions, assessment formalities have been completed, and duty leviable has
been paid. However, it is often the case that the importer files the Bill of Entry but does not clear
the goods due to various reasons such as financial problems, lack of demand for the goods, etc.
Such goods are called ‘uncleared goods’. In some cases, the importer does not even come forward
to file the Bill of Entry for clearance of goods. Such goods are known as ‘unclaimed goods’.
1.2 In terms of the provisions of the Customs Act, 1962, the duty is leviable on imported goods,
regardless of whether they are cleared by the importers or not. Similarly, dues of other agencies,
such as, carriers and custodians for carriage and storage of goods respectively, may also arise.
Where the importers do not come forward to make payment of such dues, the Customs duty and
other dues can be recovered by selling the unclaimed/uncleared goods.
2. Legal provisions:
2.1 As per Section 48 of the Customs Act, 1962, if any goods brought into India from a place outside
India are not cleared for home consumption or warehoused or transhipped within 30 days from
the date of unloading thereof at a port, such goods can be disposed off by the custodian. The Act,
however, stipulates that the goods can be sold only after a notice is issued to the importer and the
permission from Customs is obtained. The provisions relating to manner of disposal of
unclaimed/uncleared goods and apportionment of sale proceeds thereof are contained in Sections
48 and 150 of the Customs Act, 1962.
3. Procedure for sale of unclaimed/uncleared goods:
3.1 The Board has laid down a comprehensive procedure for disposal of unclaimed/ uncleared goods.
The procedure for disposal of cargo which are unloaded at a Customs Station after being brought
from outside India on or after 01.04.2018 and which fall in the category of ‘unclaimed/ un cleared’
in terms of section 48 of the Customs Act, 1962 is as follows:-
(i) The concerned custodian of the Customs Station shall prepare a list of cargo lying
unclaimed/ un-cleared in the bonded area of the Customs Station for more than 30 days
from the date of arrival of such cargo in the Customs Station. This list shall be sent to the
jurisdictional Commissioner of Customs to intimate as to whether listed goods/cargo can be
taken up for disposal through public auction. The list will contain the following details:
(a) Bill of Lading No. and date
(b) Container number
(c) Description of goods
(d) Weight
(e) Name of the consignor (exporter) and consignee (importer).
These details will be furnished as per the information available from the IGM message of
ICEGATE.
(ii) The custodian shall simultaneously update the list with importer’s name and address. In
those cases, where the address of the importer is not mentioned in the IGM message from
ICEGATE, a notice shall be sent to the respective Shipping Line requesting them to give
address of the importer/consignee within one week of receipt of the notice.
The Shipping Line will be obliged to respond with the relevant details within 7 days of receipt
of letter from the custodian. The Shipping line will also be requested by the custodian to
contact the importer and ask him to clear the cargo from the concerned Customs Station.
(iii) Jurisdictional Commissioner of each customs station shall issue instructions to the officers
and staff posted at the station to ensure that details of all goods/shipments which are put on
hold for investigation or otherwise by DRI/Preventive/SIIB or any other agency are furnished
to the Disposal branch of the customs station and the concerned custodian immediately,
under proper receipt and acknowledgement. This will ensure that the Disposal branch and
custodian are at all times aware of the goods/shipments/containers for which ‘No Objection
Certificate’ from the concerned agency would be required before initiating disposal process.
(iv) From the said list, Customs will segregate shipments which are disputed/stayed shipments
required to be retained for investigation/adjudication/court procedure etc. Customs shall also
segregate shipments containing motor vehicles or other goods requiring Licence/
Permission/ Certification from DGFT or any other Department. Customs will furnish to the
custodian within 10 days of the receipt of the said list, the details of shipments not to be
included in the auction process. Customs shall also choose 10% shipments from the list of
shipments segregated for inclusion for the auction process for which detailed inventory shall
be made in their presence for sample check. This will be conveyed to the concerned
custodian along with the list of shipments/containers which are required to be retained.
(v) (a) Based on the intimation received from Customs, the concerned custodian will issue a
notice to importer under Section 48 of the Customs Act 1962 advising him to clear the goods
within 10 days from the date of issue of the notice failing which the goods will be placed in
public auction. Notice will be sent to the importer on the address as given in IGM message
available with the custodians, or the address ascertained from the shipping lines in terms of
the para 3 (ii) above.
(b) A copy of the notice issued to the importer under section 48 of the Customs Act, 1962
shall also be affixed on the notice board of the Customs Station.
(vi) The concerned custodian, in the next 20 days shall prepare a detailed inventory of the
shipments which are not required to be retained by Customs for any purpose. In doing so,
they will associate the Customs in 10% of the consignments for which Customs has already
intimated that inventory has to be drawn in their presence for sample check.
(vii) Within 7 days of drawing up of inventory, the concerned custodian shall approach the
jurisdictional Customs authorities along with the said inventory seeking No Objection
Certificate (NOC) in respect of all containers which are to be taken up for auction through
the e-auction/tender. The inventory should have a detailed description of the items, to
enable Customs to easily identify the regulatory requirements in respect of the
consignments mentioned in the inventory and it shall clearly indicate variation in description
of goods with respect to description of goods mentioned in the list already forwarded as per
para 3 (i), above.
(viii) Customs shall examine the list and within 15 days of receipt of such request, intimate to the
custodian, details of the listed shipments which can straightway be taken up for auction as
they do not require any regulatory clearances (NOC from FSSAI, Drug Controller, BIS etc.),
or do not need any chemical analysis to identify the contents and fitness for
consumption/usage. The consignments for which such unconditional NOCs are issued by
Customs, shall be taken up for auction by e-auction through MSTC to ensure maximum
outreach and participation. In order to ensure quick and regular turnover, the concerned
custodian shall attempt to hold at least one auction each month. In case the list is incomplete
and does not have the complete details for Customs to clearly pinpoint the regulatory
requirements, Customs shall indicate the deficiencies in the list, within this period of 15 days.
(ix) In case regulatory clearances from agencies other than Customs are required such as NOC
from FSSAI, Drug Controller, BIS etc., or samples of the consignment are required to be
chemically analysed to identify the contents and fitness for consumption/ usage, Customs
shall identify such requirement and intimate to the concerned custodian within 15 days of
the receipt of complete list. The concerned custodian will then approach the jurisdictional
Customs officer for assistance in obtaining the said regulatory clearance. If in this process,
chemical analysis is required, Customs shall draw the samples and forward the same to the
respective agency for testing. The required testing fees or such other charges required to
be paid to the concerned agency, shall be paid directly by the concerned custodian to the
said agency. The concerned agency will be required to submit the test reports within 15
days of receipt of the samples.
(x) NOC for such consignments shall be issued by Customs only after receipt of the required
clearance/result of chemical analysis from the concerned agency, without which the
concerned custodian shall not put the said consignment for auction.
(xi) In case the result of chemical analysis, or report from FSSAI, Drug Controller, Plant
Quarantine etc. indicate that the sample is not fit for consumption/usage, Customs shall
inform the concerned custodian about the need for destruction of the same and the
concerned custodian shall arrange to destroy the same at their expense, after obtaining the
requisite environmental and other clearances as per law. Date of the proposed destruction
shall be intimated to Customs at least 15 days in advance, to enable the representative of
the Customs to witness the same, should the need for the same be felt.
(xii) The value of the shipment/lot included in the auction list shall be fixed in next 7 days by a
panel of Govt. approved valuers appointed by the concerned custodian which shall include
an expert on the product line without involvement of the local Customs authorities. The
values assessed by the approved valuers appointed by the custodians shall form the
“reserve price”.
(xiii) The concerned custodian shall fix a date immediately after assessment of value of such
shipment/lot, for holding the auction/tender and communicate such date to the jurisdictional
Commissioner of Customs and the Assistant/Deputy Commissioner, Disposal branch of the
Customs Station. The Assistant/ Deputy Commissioner shall nominate, if necessary, an
officer not below the rank of Superintendent/Appraiser to witness the auction/tender.
Customs shall not withdraw any consignment at the last moment from the auction/tender
except with the written approval of the jurisdictional Commissioner of Customs.
(xiv) The shipment/ lot in respect of which NOC has been given by Customs, shall be taken up
for auction. All bids of value equal to or more than the reserve price, or those up to 5% less
than the reserve price, shall be treated as successful bids for sale of goods. Remaining
shipments/ lots of the list shall again be taken up for second auction against the same
reserve price. In case, shipments or lots, where bids are not received up to the reserve price,
shall again be taken up for third auction against the same reserve price. Unsuccessful
shipments/ lots of third auction, in respect of which three auctions have already taken place,
shall be considered for fourth auction against the reserve price fixed before the first auction
of such shipments/lots, however, in the fourth auction such shipments/lots are to be
necessarily sold for the highest bid regardless of the reserve price fixed. In the event of the
shipments/ lots not being disposed of in the first auction, subsequent auction/ tender should
be conducted in a time bound manner and such shipments/lots should be taken up in the
next auction. Custodian shall furnish shipment/ lot wise bids received in respect of each
auction to the jurisdictional Commissioner of Customs for approval. Further, if these goods
remain unsold and pass into the category of landed-more than one-year prior, the concerned
custodian can sell the same following the independent procedure as detailed in para 3 of
CBIC Circular No. 50/2005-Cus. dated 01.12.2005 without any reference to Customs, and
adjusting the number of auctions/ tenders to which the lot was already subjected to against
the prescribed number of four such auctions/ tender. However, even for such goods the
requisite NOC from Customs will be obtained by the concerned custodian following the
procedure laid down in paras above.
(xv) After the successful bidder has been informed about the result of the auction, a consolidated
bill of entry, buyer-wise will be filed with the Customs in the prescribed format by the
concerned custodian for clearance of the goods as per Section 46 of the Customs Act 1962
read with Un-Cleared Goods (Bill of Entry) Regulations, 1972 (Regulation 2 & 3).
(xvi) (a) The proper officer of Customs shall assess the goods to duty in accordance with the
extant law within 15 days of filing of the Bill of Entry and after assessment inform the amount
of duty payable to the concerned custodian.
(b) The auctioned goods shall be handed over to the successful bidder after assessment
and out-of-charge orders given by the proper officer, on payment of dues. 4. The above
procedure shall be applicable to cargo, which are unloaded at a Customs Station after being
brought from outside India on or after 01.04.2018 and which fall in the category of
‘unclaimed/ uncleared in terms of section 48 of the Customs Act, 1962. It would also be
applicable to all unclaimed/un-cleared goods brought from outside India before 01.04.2018
(unclaimed/ uncleared for a period not exceeding one year) in respect of which: (a) auction
process has not started yet; or (b) list of cargo proposed for auction has been sent to
Customs by the custodian but Customs has not yet provided the necessary information as
referred in the para 3 (i) and 3 (iv) above.
3.2 The above procedure is also applicable to all unclaimed/un-cleared goods brought from outside
India before 01.04.2018 (unclaimed/ uncleared for a period not exceeding one year) in respect of
which:
(a) auction process has not started yet; or
(b) list of cargo proposed for auction has been sent to Customs by the custodian but Customs
has not yet provided the necessary information as referred in the para 3 (i) and 3 (iv) above
3.3 The sale proceeds of the auction shall be disbursed as per Section 150 of the Customs Act 1962.
3.4 In case the entire process of auction is not concluded within 180 days of the commencement of
auction, the custodian shall inform the bidder about further extended time which may be required
to conclude the auction process. Where ever, the bidder indicates his unwillingness to wait further,
his successful bid will be cancelled and the earnest money, if any deposited with the custodian by
the bidder will be returned to the bidder under intimation to Customs. Otherwise, the auction
process shall be concluded within the extended time conveyed to the bidder.
3.5 Wherever, any amount of earnest money is deposited by the bidder with the custodian, the same
shall be refunded to the bidder within one week of announcement of auction results where the bid
fails to succeed in the auction.
[Refer Circular No.50/2005-Cus, dated 1-12-2005, Circular No. 52/2005-Cus,
dated 09.12.2005 & Circular No. 49/2018- Customs dated 03.12.2018]
4. Disposal of hazardous waste:
4.1 The disposal of hazardous waste is to be carried out in accordance with the directions dated 14-
10-2003 of the Hon'ble Supreme Court in WP No. 657/95. Basically, the Apex Court has directed
that such waste is to be categorized as either those that are banned or those that are regulated.
The waste in the banned category should be either re-exported, if permissible, or destroyed at the
risk, cost and the consequence of the importer. The waste in the regulated category is permitted
for recycling and reprocessing within the permissible parameters by specified authorized persons
having the requisite facilities under the rules. Disposal of hazardous and other waste regulated by
the provisions of Hazardous and Other Wastes (Management and Transboundary Movement)
Rules, 2016, shall be in accordance with the provisions of the said rules. In case of illegal import
of the hazardous or other waste, the importer shall re-export the waste in question at his cost
within a period of ninety days from the date of its arrival into India and its implementation will be
ensured by the concerned Port and the Custom authority. In case of disposal of such waste by the
Port and Custom authorities, they shall do so in accordance with these rules with the permission
of the Pollution Control Board of the State where the Port exists. In case of illegal import of
hazardous or other waste, where the importer is not traceable then the waste either can be sold
by the Customs authority to any user having authorisation under rules from the concerned State
Pollution Control Board or can be sent to authorised treatment, storage and disposal facility.
[Refer Circular No.31/2004-Cus, dated 26-4-2004]
5. Compliance with restrictions/prohibitions under various laws:
5.1 The disposal of goods, which are subject to restrictions/prohibitions under any law for the time
being in force, can only be made in terms of the relevant statutes.
6. Mechanism for interaction between custodians and Customs:
6.1 There would be a formal mechanism for interaction and a quarterly meeting between the
custodians and Customs to review the pendency of uncleared cargo and to reconcile/update the
status of pending consignments by matching the pendency with the custodian with the figures of
uncleared consignments as per Customs records.
Refer Circulars No.31/2004-Cus, dated 26-4-2004, No.50/2005-Cus, dated 1-12-2005, No.52/2005-
Cus, dated 9-12-2005, No.11/2006-Cus, dated 16-2-2006 and Instruction F.No.450/97/2010-
Cus.IV, dated 22-7-2010.
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