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Difference between shut out cargo and short shipment cargo
How to differentiate short shipment between shut out?
Shut out and short shipment are the two terms used in Export customs clearance formalities and procedures in India.
What is shut out Cargo? How does short shipment cargo work? How to differentiate between Shut out cargo and Short Shipment Cargo?
Shut out in Exports means, bringing back the goods to shipper’s premises after completion of customs export clearance procedures. If the export quantity of goods are lesser than the quantity mentioned in the export shipping documents filed with customs it is called short shipment.
Shut out procedures in export customs clearance happens once exporter decides to cancel the export movement of goods after completion of export customs clearance procedures.
‘Shut out’ can happen due to cancellation of export order, non fulfillment of quality specifications or change of goods shipped or any other reasons. Once exporter realizes and decides, not to ship the goods to the overseas buyer after completion of export procedures, he seeks permission from customs to take back the goods to his premises. In some cases of ‘shut out shipment’, the cargo would have already moved to load port. However, the cargo can be brought back to the supplier’s premises by completing necessary formalities with customs.
What is short shipment? How does Short shipment work in Exports?
If any shortfall on quantity of goods filed for export customs clearance procedures, such amount of shortage is called Short shipment. For example, an exporter arranges export customs clearance procedures against an export order of 500 pieces in a shipment. However, after filing of necessary documents for export customs clearance, the exporter realizes that the number of quantity is only 475 pieces ready for shipment with a shortage of 25 pieces. Here, he obtains permission to ship 475 pieces from overseas buyer and arranges to correct in export shipping bill accordingly. A short shipment notice for a quantity of 25 pieces is filed with necessary permission from customs and mention on shipping bill about the quantity short shipped. This short shipment notice is attached along with each copy of original shipping bill. This procedure is taken place where in no facility for electronic filing of shipping documents available. This procedure is easier and save dwell time at customs location where in electronic facility available.
I hope, I could differentiate Short shipment and Shut out procedures and formalities in Export customs clearance.
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