Indian Customs Law, Functions updated till 31st December, 2023
The following information is a part of Indian Customs manual for the year 2023 designed by Indian customs and published by Central Board of Indirect Taxes and Customs. The details below explains about the functions of Indian Customs updated till 31st December, 2022. We hope, the following information extracted from Indian customs Manual supports the readers of this website www.howtoexportimport.com . The numerical number mentioned at the left side of the content reads Chapter and paragraph of Indian Customs Manual updated till 31st December, 2022.
The functions of Indian Customs explained as below:
Overview of Customs Functions
1. Introduction
1.1 Central Board of Indirect Taxes and Customs (CBIC or the Board), Department of Revenue,
Ministry of Finance, Government of India deals with the formulation of policy concerning levy and
collection of Customs, Goods and Service Tax (GST) and Central Excise duties, prevention of
smuggling and administration of matters relating to Customs, Goods and Service Tax (GST),
Central Excise, and Narcotics to the extent under CBIC's purview. The Board is the administrative
authority for its subordinate organizations, including Custom Houses, Customs Preventive
Commissionerates, Central Goods and Service Tax (CGST) Commissionerates and the Central
Revenues Control Laboratory.
1.2 The important Customs related functions include the following:
(a) Collection of Customs duties on imports and exports as per the Customs Act, 1962 and the
Customs Tariff Act, 1975;
(b) Enforcement of various provisions of the Customs Act, 1962 governing imports and exports
of cargo, baggage, postal articles and arrival and departure of vessels, aircrafts etc.;
(c) Discharge of agency functions and enforcing prohibitions and restrictions on imports and
exports under various legal enactments;
(d) Prevention of smuggling including interdiction of narcotics drug trafficking; and
(e) International passenger clearance.
1.3 Customs functions cover substantial areas of activities involving international passengers, general
public, importers, exporters, traders, custodians, manufacturers, carriers, port and airport
authorities, postal authorities and various other government and semi-government agencies,
banks etc.
1.4 Customs is continuously rationalizing and modernizing its procedures through adoption of EDI and
global best practices. Also, as a member of the World Customs Organization, Indian Customs has
adopted various International Customs Conventions and procedures including the Revised Kyoto
Convention, Harmonized Classification System, GATT based valuation etc.
2. Statutory provisions for levy of Customs duty:
2.1 Entry No. 83 of List 1 to Schedule VII of the Constitution empowers the Union Government to
legislate and collect duties on imports and exports. Accordingly, the Customs Act, 1962, effective
from 1-2-1963 provides vide its Section 12 for the levy of duties on goods imported into or exported
from India. The items and the rates of duties leviable thereon are specified in two Schedules to
the Customs Tariff Act, 1975. The First Schedule specifies the various import items in systematic
and well considered categories, in accordance with an international scheme of classification of
internationally traded goods known as “Harmonized System of Commodity Classification” and
specifies the rates of import duties thereon, as prescribed by the legislature. The duties on
imported items are usually levied either on specific or ad- valorem basis, but in few cases specific
cum-ad-valorem duties are also levied. The Second Schedule incorporates items that are subject
to exports duties and the rates of duties thereof.
2.2 The predominant mode of levy of duties is on ad-valorem basis i.e., with reference to value. For
this purpose, the value of the imported goods is required to be determined as per Section 14 of
the Customs Act, 1962 read with the Customs Valuation (Determination of Value of Imported
Goods) Rules, 2007. These provisions are essentially the adoption of GATT based valuation
system (now termed WTO Valuation Agreement) which is being followed globally. Likewise, the
value of export goods is required to be determined as per provisions of Section 14 of the Customs
Act, 1962 read with the Customs Valuation (Determination of Value of Export Goods) Rules, 2007.
3 Ease of Doing Business
3.1 Board has initiated numerous measures to facilitate the Customs clearance process and reduce
transaction costs. The objective is to make the Customs clearance process in India a world class
experience by reducing dwell time of cargo, which in turn improves the competitiveness of
businesses. Some of these measures are presently work in progress and their present importance
is in the fact that these highlight the approach of the Board towards ensuring the ease of doing
business.
3.2 Paperless Initiatives
1. Single Window: An Indian Customs Single Window Project has begun with the establishment
of an appropriate administrative structure in the form of an inter-ministerial Steering Group
that is chaired by Member (Customs), CBIC, a Project Management Group in CBIC and
Project Management Units in the Ministries. With the introduction of Single Window, an
electronic online message exchange between the Food Safety and Standards Authority of
India (FSSAI) and the Department of Plant Protection, Quarantine and Storage (PQIS) with
the Customs has started, which enables reducing the dwell time considerably. Under this
online message exchange system for import goods there is seamless online exchange in real
time of the Customs Bill of Entry (Import declaration) with these agencies and Release Order
(RO) from both the agencies will be received by the Customs in electronic message format.
The salient features of this online message exchange system are as under:
(i) Indian Customs EDI System (ICES) would transmit “BE message” to the FSSAI and
PQIS on completion of assessment of the relevant Bills of Entry (Bs/E) by the Customs
ICES application after entry-inward of the consignment. The BE message would be
provided to FSSAI/PQIS for all Bs/E falling under the identified Custom Tariff Heads
(CTHs), as per list made available by the respective agencies.
(ii) The Customs officers would be able to access the details of the Bs/E referred by the
ICES to FSSAI/PQIS.
(iii) The importers would track the status of the Bs/E on ICEGATE
(https://www.icegate.gov.in).
(iv) The receipt of the Bs/E message shall be acknowledged by the FSSAI/PQIS through a
receipt message to the ICES.
(v) On processing of the Bs/E message by the FSSAI/PQIS, these agencies would
electronically transmit an RO, concerning each item of the Bs/E. From the Customs
side, Out of Charge (OOC) will not be allowed in the system till the RO is received from
the agency concerned for all the items. There are 6 types of ROs which may be provided
by the FSSAI/PQIS to the ICES, as follows:
(a) Release - goods can be released by the Customs.
(b) Destruction goods to be destructed by the Customs.
(c) Deportation goods to be exported back to the Country of Origin.
(d) No Objection Certificate (NOC) goods can be released by the Customs.
(e) NCC (Non-compliance Certificate) non-rectifiable defects observed in the goods.
(f) Product Out of scope - goods are out of scope for FSSAI/PQIS.
(vi) In case, the Release Order falls under types (b), (c) and (e) above, the OOC would not
be allowed in the ICES. Details of such consignments will be entered by the Customs
Assessing Officer in the closure of B/E menu after all processes are complete.
(vii) On receipt of RO online, the Customs ICES shall integrate the data in the ICES
database, which shall be available to the Customs officers concerned.
(viii) The other formalities under the Customs Act, 1962 such as duty payment, goods
registration, examination would continue during the time interval between transmission
of Bs/E message from ICES to the receipt of RO message from FSSAI/PQIS. During
this period the samples of the goods under consideration may also be taken for testing
purposes.
(ix) In terms of Board’s Circular No.3/2011-Customs., dated 6-1-2011 import consignments
that have been tested on previous five consecutive occasions and found in order may
not be referred to FSSAI. Under single window project, the electronic monitoring and
waiver of shipments which are eligible for waiver from FSSAI testing are being effected
without human interference.
(x) Since the electronically received RO in regard to Bs/E referred to FSSAI/PQIS shall be
accepted by the Customs for clearance of the imported foods items/plant materials, the
Customs shall not insist on a physical copy of the RO from these agencies.
[Circular No. 09/2015-Customs dated 31.03.2015]
(xi) SWIFT in Exports have been extended on export side for online referral to WCCB to
all Customs EDI locations for smooth online clearance.
[Refer Circular No.9/ 2015 Cus., dated 13-4-2015, Circular No.1/2017-Customs
dated 04-01-2017, Circular No.31/2017-Customs dated 25-07-2017]
2. IGM /SMTP: Taking into account the requirement of Customs as well the fact that an electronic
version of IGM is already available, Board has decided that the number of hard copies of IGM
to be submitted by shipping lines / steamer agents at a Customs House shall be restricted to
2 (two) only. Further, the steamer agent has the option to (a) give a continuity bond and (b)
merge the guarantee with the continuity bond, which would reduce the number of required
documents to 1 (one) only and the periodicity (of submission) would also get reduced
drastically. Also, it is decided that only 1 (one) copy of SMTP would be sufficient for the
Customs at ICDs. Finally, no separate permission is required from jurisdictional Customs in
case of change of mode of transshipment under the Goods Imported (Conditions of
Transshipment) Regulations, 1995. However, the carrier is required to intimate the change to
the jurisdictional Commissioner of Customs who will ensure the bond covers both modes of
transport.
[Refer Circular No. 2/2015 Cus. dated 15-1-2015]
3. Reduction of documents: The Board has decided that in case an importer/exporter submits
a commercial invoice cum packing list that contain all necessary data fields / information
otherwise contained separately in these documents, a separate packing list would not be
insisted upon by Customs. However, the option to do so is with the importer/exporter. As a
result, the documents ordinarily required by the Customs stand reduced to only 3 viz. Bill or
Entry or Shipping Bill, commercial invoice cum packing list and Bill of Lading or Air Waybill.
[Refer Circular No 1/2015 Cus., dated 12-1-2015]
Mandatory uploading of specified documents in E-Sanchit: Board has decided to mandatorily
require uploading on eSANCHIT, for every Bill of Entry, Invoice/ Invoice cum packing list and
Transport Contract i.e. Bill of Lading/ Air Waybill etc., as the case may be. Directorate of
Systems have issued Advisory No. 25/2019 dated (web link) laying down requirement of
mandatory uploading on e-Sanchit, the Invoice/ Invoice cum packing list and Bill of Lading/ Air
Waybill etc. for every Bill of Entry and subsequent declaration of document code and IRNs in
the Bill of Entry. With effect from 02.12.2019, for every Invoice and Bill of Lading / Air Waybill
declared in the Bill of Entry, the reference of IRN generated from eSANCHIT with the relevant
document code as given above must be provided. The reference of the above document codes
from eSanchit in the Bills of Entry has been made mandatory in System. As regards all the
other supporting documents (such as Country of Origin Certificate (COO), licence/ permission
from any Government Agency (PGA) in relation to the eligibility for import / clearances or claim
of duty exemption), it is emphasised that to make Customs duty truly paperless, uploading of
these documents through eSANCHIT either by beneficiary or by PGAs, should be ensured
administratively. Therefore, the field offices must ensure that no physical copy of any
supporting document is submitted and every relevant document is submitted only
electronically via eSanchit either by the beneficiary or by the Participating Government
Agency.
[Refer Circular No 42/2019 Cus., dated 29-11-2019]
4. Dispensing with SDF: The Board has issued Notification No 46/2015-Cus (N.T.), dated
18.05.2015 to incorporate the following declaration in lieu of SDF form in the Shipping Bill.
“I/We undertake to abide by provisions of Foreign Exchange Management Act, 1999, as
amended from time to time, including realization / repatriation of foreign exchange to /
from India”
Thus, submission of SDF form along with Shipping Bill has been dispensed with provided the
said declaration is furnished in the Shipping Bill.
[Refer Circular No.15/2015 Cus., dated 18-5-2015]
5. Digital Signature: The Board has decided that with effect from 1-4-2015 importers, exporters,
customs brokers, shipping lines, airlines or their agents shall have the facility to use Digital
Signature Certificate for filing Customs process documents viz. Bills of Entry, Shipping Bills,
IGM (General Declaration and Cargo Declaration), EGM (General Declaration), CGM through
Remote EDI System (RES). Besides ACP, all importers, exporters using services of Customs
Brokers for formalities under Customs Act, 1962, shipping lines and air lines are required to
file customs documents under digital signature certificates mandatorily with effect from
01.01.2016.
[Refer Circular No.10/2015 Cus., dated 31-3-2015 and
Circular 26/2015- Customs dated 23.10.2015]
6. E-Sanchit: The CBIC has introduced ‘eSanchit’ for paperless transaction. The importers are
now required to upload the required documents online through www.icegate.gov.in while filling
the Bill of Entry instead of submitting the physical papers. Reply to queries raised by Customs
Officers can be submitted online by uploading the documents. Physical presence of paper or
person for assessment related works have been done away with. CBIC is embarking on a
project to bring all Participating Government Agencies(PGAs) under eSanchit wherein PGAs
who issues Licenses, Permits, Certificates and Other Authorizations (LPCOs) would upload
the documents themselves doing away with uploading of such document by the beneficiary
(importer/ exporter) themselves. Importers/ Exporters, Customs Brokers and other
beneficiaries are required to register on ICEGATE for this purpose.
[Refer Circular 35/2018- Customs dated 01.10.2018]
E-Sanchit expansion: Aimed at further reducing physical interface between
Customs/regulatory agencies and the trade and to increase the speed of clearance in both
imports & exports, the E-Sanchit application provides a facility to upload digitally signed
Licenses/Permits/Certificates/Other Authorizations (LPCOs) by Participating Government
Agencies (PGAs) at all ICES locations across India. In this regard, kindly Refer to Board’s
Circulars No. 44/2018-Cus. dated 13.11.2018, No.13/2019-Cus. dated 03.06.2019,
No.19/2019-Cus. dated 16.07.2019, No.03/2020-Cus dated 15.01.2020, No.11/2020-Cus.
dated 10.02.2020 and No.24/2020 dated 14.05.2020. With issue of Board Circular
No.57/2020-Customs dated 30.12.2020, two (2) more PGAs namely Trade Promotion Council
of India (TPCI) and Export Promotion Council for EOUs & SEZs (EPCES) were brought on
board eSANCHIT platform. With this, the total number of PGAs on Board eSANCHIT becomes
53.
[Refer Circular No.57/2020-Customs dated 30.12.2020].
7. Electronic Closure of Manifest: With the submission of supporting documents online, the
manifest department of Customs Houses will not receive hard copies of dockets. Officers shall
rely on the electronic records maintained on ICES.
Request for re-testing of sample made within a specified time by the importer or agent may
be granted by the Additional Commissioner or Joint Commissioner of Customs as a trade
facilitation measure. For uniformity in procedure at the various field formations, Board has
issued detailed guidelines for retesting of samples.
[Refer Circular No. 30/2017-Customs dated 18.07.2017]
3.3 Other Initiatives
1. Sea Cargo Manifest and Transhipment Regulations (SCMTR): Vide Notification
No.38/2018-Customs (N.T.) dated 11.05.2018 the Sea Cargo Manifest and Transhipment
Regulations (SCMTR), 2018, were notified. The SCMTR seek to bring about transparency,
predictability of movement, advance collection of information for expeditious clearance and
supersedes the earlier regulations viz. Import Manifest (Vessels) Regulations, 1971 and
Export Manifest (Vessels) Regulation, 1976 and Transportation of Goods (Through Foreign
Territory) Regulations, 1965. The new Regulations stipulate for advance notice by
authorized carriers for goods arriving in or being exported out of India through gateway
seaports and further movement between Customs stations. They stipulate the obligations,
roles and responsibilities for the various stakeholders involved in movement of
imported/export goods. The implementation plan and timelines for mandatory compliance
pertaining to stakeholders such as ASC/ASA (Authorized Sea Carriers/Sea Agents), ANC
(Other Notified Carriers- like Freight forwarders, NVOCCs etc) and ATP (Authorized
Transhippers), and the documents to be filed by them have been laid down in annexure to
Circular No.43/2020-Customs dated 30th September, 2020.
[Refer Circular No. 43/2020 Cus. dated 30-09-2020]
2. Mandatory filing of documents in SCMTR by Custodians: Board has decided that
messages by the Custodian i.e., Stuffing Message (SF), ASR Filing, DP Filing and AR filing
by the Custodians and VCN message by the Terminal Operators mandatorily required to be
filed w.e.f. 20th July 2021.
[Refer Circular No. 12/2021 Cus.. dated 30-06-2021]
3. Re-export permission: With a view to expedite decision-making in respect of re-export of
when the said goods are destined elsewhere but which are inadvertently imported at a
particular Customs station, the Board has decided that the permission for re-export may be
granted on merit by the officer concerned as per the adjudication powers as per Section 122
of the Customs Act, 1962.
[Refer Circulars No.24/2011-Cus., dated 31-5-2011 and
No.4/2015 Cus dated 20-1-2015]
4. CRCL Module - Forwarding of samples using electronic Test Memo to CRCL and other
Revenue Laboratories: As detailed in circular No. 46/2020-Customs dated 15.10.2021,
CRCL and other Revenue Laboratories have been upgraded with several new, state of the
art equipment, thereby enabling the testing of a wider variety of commodities in lesser time,
with greater accuracy. For details, the CRCL brochure available at www.crcl.gov.in may be
perused. In order to further ease the testing process, DG Systems has enabled a ‘CRCL
module’ in ICES with the objective of automating all paperwork related to sampling,
forwarding of test memos to CRCL and other Revenue Laboratories, and electronic receipt
of test reports, instantly by the Customs Officers. The officials of CRCL and other Revenue
Laboratories have been provided access for both import and export functionalities in the
CRCL module. The CRCL module is also seamlessly integrated with current modules of
ICES.
[Refer Circular No.46/2020-Customs dated 15.10.2020 and
Instruction No.14/2021-Customs dated 21.06.2021]
5. CCFC: Board has set up a Customs Clearance Facilitation Committee (CCFC) at every
major Customs seaport, airport, Customs Preventive Commissionerates (Land Customs
Stations) and Commissionerates having jurisdiction over Inland Container Depot, which is
chaired by the Principal Commissioner of Customs/Commissioner of Customs concerned.
Its membership includes the senior-most functionary of the
departments/agencies/stakeholder at the particular seaport/airport namely, (i) Food Safety
Standards Authority of India/Port Health Officer (PHO), (ii) Plant Quarantine Authorities, (iii)
Animal Quarantine Authorities, (iv) Drug Controller of India (CDSO), (v) Textile Committee,
(vi) Port Trust / Airport Authority of India / Land Ports Authority of India (for CCFC in
LCSs),(vii) Custodians, (viii) Forest and Wild Life Authorities, (ix) Railways/CONCOR, (x)
Border Security Agencies (for CCFC in LCSs), (xi) Pollution Control Board and (xii) any
other Department / Agency / stakeholder to be co-opted on need basis. The CCFC is
required to meet once a week or more frequently, if needed, as per the following mandate:
(i) Ensuring and monitoring expeditious clearance of imported and export goods in
accordance with the timeline specified by the parent ministry/Department concerned;
(ii) Identifying and resolving bottlenecks, if any, in the clearance procedure of imported
and export goods;
(iii) Initiating Time Release Studies for improvement in the clearance time of imported and
export goods;
(iv) Having internal consultations to speed up the clearance process of imported and
export goods and recommending best practices thereto for consideration of CBIC /
Departments / Agencies concerned; and
(v) Resolving grievances of members of the trade and industry in regard to clearance
process of imported and export goods.
[Refer Circular No. 13/2015 Customs, dated 13-4-2015; Circular No. 44/2016-Cus dated
22.09.2016. For more details of CCFC, please refer Chapter 32.]
4. Control and regulatory provisions:
4.1 The Customs Act, 1962 is the basic statute which regulates the entry/exit of different categories
of vessels/crafts/goods/passengers etc., into or outside the country. Various allied laws and
regulations also apply. It is the responsibility of Customs to handle international traffic speedily
and effectively while ensuring that all the goods/passengers etc., imported/coming into the country
or exported/going out of the country by sea, air, land or rail routes are in conformity with the laws
of the land.
4.2 In terms of the Customs Act, 1962, the Board is given the powers to appoint Customs ports,
airports and Inland Container Depots (ICD) where alone the imported goods can be unloaded or
export goods loaded. Similar powers have been given to the Board to notify places as Land
Customs Stations (LCS) for clearance of goods imported or exported by land or by inland water.
Thus, various airports, ports, ICDs and LCSs have been notified across the country and also
routes have been specified for carrying out trade with neighbouring countries like Nepal.
4.3 Once a particular Customs port or airport is notified, the Customs Act, 1962 empowers the
jurisdictional Commissioner of Customs to approve specific places therein where only loading and
unloading can take place and also to specify the limits of the Customs area where the imported
goods or the export goods are ordinarily to be kept before clearance by Customs authorities.
4.4 Essentially all goods brought into the country or meant for export must pass through authorized
points, be reported to Customs, and the importers/exporters must fulfil the prescribed legal and
procedural requirements laid down under Customs Act, 1962 and allied laws including payment of
the duties leviable, if any. The legal provisions allow Customs to regulate the outflow of the goods
(and persons) out of the country and subject them to proper checks before allowing final exit out
of the country by sea/ air/land/rail routes. Customs also detect legal infringements and foil any
attempts of smuggling or commercial frauds by unscrupulous parties.
5. Role of Custodians:
5.1 In regard to all imported goods unloaded in a Customs area, the Commissioner of Customs is
required to appoint a custodian under whose custody the imported goods shall remain till these
are cleared for home consumption, or are warehoused or transshipped as provided in the law.
With the growth of containerized traffic the facility of Customs clearances in the interiors of the
country has also been provided by opening various ICDs, which are actually dry ports and here
too the goods remain with the appointed custodian
till these are cleared by the Customs. In addition to custodians appointed by the Commissioner of
Customs, the Customs Act, 1962 recognizes other custodians as provided under any other law.
For instance, the Mumbai Port Trust is a legal custodian under the Major Ports Trust Act, 1963.
The custodian is essentially required to take charge of the imported goods from the carrier, arrange
its proper storage and safety and allow clearance to the importers only after they fulfill all Customs
formalities, pay requisite duties and other charges/fees and discharge various other obligations.
No goods can be cleared from a Customs area without the express permission of Customs.
Moreover, since the Customs Act, 1962 obliges the custodians to ensure safe custody of the
imported goods till delivery, in case these goods are pilfered while in custody, the custodian is
required to pay duty on such goods.
5.2 Various port trusts and other authorities in the public and private sectors handle the import and
export cargo when kept in their custody at various ports, international airports/ ICDs. The cargo
handling and custody at the international airports is generally entrusted to International Airport
Authority of India (IAAI), but there is an increasing trend of the IAAI leasing such facility to private
sector or even of direct entry of private sector in this area. Also, new ICDs are being opened at
various places in the interior of the country as a facilitation measure with the result that Customs
clearances of both imported and export cargo from these places has expanded substantially in
recent years.
5.3 Maximum import and export cargo is handled at different sea ports and there is a trend towards
containerized cargo movement; increasing part of import cargo landed at some ports like Nhava
Sheva is also transshipped to interior ICDs for final clearance by importers at their door steps.
Security arrangements ensure there is no pilferage/ theft of the cargo and arrangements of loading
and unloading of cargo at different berths in various docks, their movement to different places
including container yards/ storage godowns etc., are arranged by the port authorities.
5.4 Customs authorities are given appropriate office place and requisite facilities in the dock area as
well as in international cargo complexes/ICDs etc., to discharge their functions in relation to
imports and exports such as supervision of loading/unloading of goods from vessels/crafts etc.,
supervision of stuffing or de-stuffing of containers, inspection and examination of goods which are
imported/presented for exportation before Customs clearance formalities etc. For this purpose and
in order to provide comprehensive guidelines for custodians / Cargo Service Providers (CCSP) for
handling, receipt, storage and transportation of cargo in a Customs area, the Board has framed
the Handling of Cargo in Customs Areas Regulations, 2009.
6. Obligations of carriers:
6.1 To regulate and have effective control on imports and exports the Customs Act, 1962 enjoins
certain liabilities on the carriers. Thus, they have to bring in the cargo imported into the country for
unloading only at notified ports/airports/Land Customs Stations; furnish detailed information to
Customs about goods brought in for unloading at that particular port/international airport as also
those which would be carried further to other ports/airports. Declaration of such cargo has to be
made in an Import General Manifest(IGM) prior to arrival of the vessel/aircraft at the Customs
station. In the case of imports through Land Customs Stations the person in charge of the vehicle
has to give similar import report within 12 hours of its arrival. Since the cargo clearance formalities
are linked generally with the availability of information about cargo being brought by a vessel for
unloading at any port, provisions are also made for prior filing of an IGM if all details of relevant
cargo for any port are available even before the vessel arrives. The final IGM can be filed after
arrival of the vessel.
6.2 Unless, the IGM is furnished in the prescribed form, no unloading of cargo can be undertaken from
any vessels/aircrafts/vehicles in normal circumstances. After the IGM is duly delivered the
unloading takes place under the supervision of the Preventive Officers of Customs. The law
prohibits unloading of any goods at a Customs station, which are not mentioned in the IGM/import
report. Similarly, there are restrictions on loading for export such that no vessel/aircraft can begin
loading goods for export unless intimation is given to Customs and its permission for loading
obtained – Outward what is also called “Entry of the vessel”. Loading of cargo on vessels, aircrafts
etc. is checked and supervised by Preventive Customs Officers who ensure that cargo loaded has
discharged the prescribed Customs formalities such as payment of duties or cess, where leviable,
any other formalities enjoined by the law, and authorization for exports is duly given by the proper
officer as a part of Customs clearance formalities.
6.3 The person in charge of the vessel/aircraft is required to furnish details of all the goods loaded on
a vessel/aircraft in a prescribed form, which is termed 'Export General Manifest” (EGM). The
person in charge of a vehicle must furnish a similar report called “Export Report”. The EGM/Export
Report is to be furnished before the vessel/aircraft/ vehicle departs and is essentially taken as the
proof of shipment/export.
7. Customs preventive control:
7.1 No vessel/aircraft can leave a Customs station unless a written order for port clearance is given
by the proper officer of Customs. This permission for departure is given subject to the satisfaction
of the proper officer that all the prescribed formalities have been fulfilled, duties/penalties etc.,
have been paid or secured.
7.2 The Preventive Officers of Customs are authorized to board the vessels/aircrafts to take suitable
declarations, crew property list etc., and to check whether there are any goods which are not
declared for unloading at a particular Customs station in the IGM with intention to smuggle them
without following the prescribed formalities and payment of duties. A thorough examination and
checking of the vessels/aircrafts - known as rummaging - is also undertaken on selective basis
taking due note of the past history of the vessels, the port/airport from which these are arriving,
the intelligence report etc.
7.3 The Preventive Officers of Customs also keep a very careful vigil for checking any illegal activities
and develop intelligence to guard against any possible attempts of unauthorized removals from
the docks, unloading of un-manifested cargo etc.
8. Customs clearance of cargo:
8.1 Before any imported goods can be cleared for home consumption in the country or for
warehousing for subsequent Customs clearances as and when needed etc., the importers have
to comply with prescribed Customs clearance formalities. Essentially, these involve presentation
of certain documents along with a prescribed application normally termed
“Bill of Entry”, which gives essential particulars in relation to imported goods, country of origin,
particulars of vessel/aircraft etc. seeking clearance of goods for home consumption/warehousing
etc. The importer either himself handles the import clearance documents or appoints Customs
Brokers who are trained and experienced in Customs clearance work and are licensed by
Customs for such work in terms of the Customs Broker Licensing Regulations, 2018.
8.2 The import clearance documentation, presentation, and processing are handled in the Custom
Houses by Appraising staff trained in assessment matters. After a tally has been made with related
IGM to ensure the goods sought for clearance have arrived and declared in the particular IGM of
the vessel/aircraft mentioned in the Bill of Entry (or even where the prior manifest is filed) the
scrutiny of documents - manually or through EDI system is taken up. The main function of the
Appraising staff in the Custom Houses is the careful scrutiny of the Bill of Entry and related
particulars / information with a view to checking the import permissibility in terms of the Foreign
Trade Policy and any other laws regulating import and to determine value, classification and duties
leviable on the goods on import - (Basic, Additional, Anti-dumping, Safeguards etc.). Permissibility
of various benefits of duty free clearances under different schemes or applicability of any
exemption notification benefits is also checked and decided.
8.3 Normally, the import declarations made are scrutinized without prior examination of the goods with
reference to documents made available and other information about the values/classification
available with Customs and duties chargeable on the goods are assessed and paid up by the
importer or his authorized representative. It is only at the time of clearance of the goods from the
custody of the port trusts/international airport authority or other custodians that these are examined
on percentage basis by separate staff posted in the premises where the goods are stored pending
Customs clearance. These officers undertake checking of nature of goods, valuation and other
part of declaration, or draw samples as may be ordered by the Appraising officers of the Custom
House/Air Cargo Complexes/ICDs. If no discrepancies in relation to the nature of goods, quantity,
value etc., are observed at the time of examination of the cargo, 'Out of Customs Charge' orders
are issued, and thereafter goods can be cleared after discharging any other fees/charges etc., of
the custodians.
8.4 At times, for determining the duty liability and permissibility of import it may become necessary to
examine the goods. Such goods are examined after filing of Bill of Entry and other documents and
based upon the report of the examining staff, duties etc. are assessed and if there is no prohibition
etc., the goods are taken clearance from the custodian without the need for further examination.
8.5 Where disputes arise in the matter of classification/valuation or any violations of any provisions of
law are observed, where the goods cannot be allowed clearance finally without further
investigations and following adjudication proceedings, the law provide for provisional clearances
subject to suitable bond/security. Only where the goods are of prohibited nature or in certain other
exceptional cases, where provisional release is not considered advisable, the final decision may
be taken after results of enquiries etc. are known and adjudication proceedings completed, where
necessary.
8.6 Customs clearance formalities for goods meant for export have to be fulfilled by presenting a
“Shipping Bill” and other related documents to the Export Section of the Custom Houses or EDI
Service Centres. The Appraising staff checks the declarations to assess the duties/cess, if
leviable, propriety of export incentives, where claimed under different schemes like Duty Drawback
or duty free exemption schemes etc. Appropriate orders for examination before shipments are
allowed export are given on the Shipping Bill. The Customs staff in the docks/cargo
complexes/ICDs examines the goods meant for export on percentage basis, and allows shipment
if there are no discrepancies misdeclarations etc., and no prohibitions/violations come to light.
Appropriate penal action as per law is initiated where any fraudulent practices get detected during
initial stage of scrutiny or at the time of examination etc.
9. Turant Customs-Next Generation reforms:
9.1 The next generation reforms in the Customs clearance process under the umbrella of Turant
Customs are with the objectives of speedy clearance, transparency in decision making, and ease
of doing business. Board rolled out numerous changes to the Customs clearance process, which
combine together support Turant Customs. These initiatives include the self-registration of goods
by importers, automated clearances of bills of entry, digitisation of customs documents, paperless
clearance, etc. The Turant Customs is primarily based on Faceless, Contactless and Paperless
Customs processes.
9.2 Faceless Customs : Indian Customs has initiated Faceless Assessment on imports from June
2020 (Reference Circular No.28/2020-Customs and Instruction No.09/2020 both dated 5th June
2020). The first phase began by linking Chennai and Bengaluru which was gradually expanded to
other geographical locations till eventual all India coverage by 31.10.2020. Briefly put, Faceless
Assessment uses a technology platform to separate the Customs assessment process from the
physical location of a Customs officer at the port of arrival. This measure is with the intent of
bolstering efforts to ensure an objective, free, fair and just assessment. Key objectives of Faceless
Assessment include:
(i) Anonymity in assessment for reduced physical interface between trade and Customs
(ii) Speedier Customs clearances through efficient utilisation of manpower
(iii) Greater uniformity of assessment across locations
(iv) Promoting sector specific and functional specialisation in assessment.
Refer to Chapter 3 Para 4.1 for more details on Faceless Customs
9.3 Contactless Customs: In recent years, CBIC has initiated reforms such as online registration of
goods, automated queuing and automated clearances of Bills of Entry, simplified online
registration in ICEGATE, auto debit of bonds, setting up of Turant Suvidha Kendras (TSKs) etc.
All these have enabled an environment which has done away with the requirement of members of
the trade to physically interact with Customs in the goods clearances process and has fostered a
`Contactless Customs` environment. Refer to Chapter 3 Para 4.2 for more details on Contactless
Customs.
9.4 Paperless Customs: CBIC has taken initiatives to enable digital submission and transmission of
both Bills of Entry and Shipping Bills in 2020. Besides saving time, the cost of printing paper
documents has also been substantially reduced. Refer to Chapter 3 Para 4.3 for more details on
Faceless Customs.
10. Smuggling and other violations and penal provisions:
10.1 Unscrupulous elements do attempt to evade the duties leviable and bypass various
prohibitions/restrictions in relation to imports by attempting to bring the goods into the country from
places other than the notified ports/airports/Land Customs Stations without reporting or presenting
the goods to customs. Similar attempts are made to unauthorizedly
Take goods out of the country. This is essentially termed as “smuggling” and Customs officers
have very important role in ensuring that they detect any such attempts of smuggling into or out of
the country and take appropriate action both against the goods as well as against the persons
involved.
10.2 The Customs Act, 1962 provides for strict penalties in relation to the goods/persons involved in
smuggling and other violations of the legal provisions. These include seizure/ confiscation
(including absolute confiscation) of the offending goods and fines and penalties on the persons
involved in the offence as well as those abetting the offence. The law also empowers Customs
officers to carry out searches, arrests and prosecution of persons involved in smuggling and
serious commercial frauds and evasion of duties or misuse of export incentives by fraudulent
practices (mis-declaration of nature, and value of the goods or suppression of quantities etc.).
10.3 Whereas the Customs Act, 1962 provides for deterrent penal provisions for violations, due process
of law has to be followed before action is taken against offending goods or persons/conveyance
etc. involved. The Customs officers act as quasi-judicial authorities and the liabilities for duty
evaded or sought to be evaded, fines, penalties etc., are adjudged by giving the persons
concerned due notice (or Show Cause Notice) of contemplated action against including the gist of
the charges and their basis and providing opportunity for representation as well as personal
hearing.
10.4 In grave offence cases, the Customs Act, 1962 provides for prosecution with imprisonment upto
maximum of 7 years. This involves criminal proceedings in a Court of law, after sanction for
prosecution is given by the competent Customs officer.
10.5 Guidelines for launching of prosecution in relation to offences punishable under the Customs Act,
1962 has been prescribed in Circular No.27/2015-Customs dated 23.10.2015 amended by
Circulars No.46/2016-Customs dated 04.10.2016, No.07/2017-Customs dated 06.03.2017,
No.12/2019-Customs dated 24.05.2019 and No.12/2022-Customs dated 16.08.2022.
11. Appellate remedies:
11.1 Any concerned person aggrieved with the departmental adjudication is given the right to appeal
against the said order. The first level of appeal is to Commissioner (Appeal) and thereafter to an
independent Tribunal (CESTAT) unless the adjudication order is originally passed by the
Commissioner of Customs in which case the first level of appeal is to the CESTAT. On questions
of law, the orders of CESTAT could also be considered for reference to the High Court and certain
categories of decisions involving classification or valuation can be appealed even before the
Supreme Court.
12. Passenger processing:
12.1 All incoming international passengers after immigration clearance have to pass through Customs
who ensure their facilitation and speedy clearance. However, at time unscrupulous passengers
may try to smuggle goods into the country which are sensitive and otherwise prohibited/restricted
or evade duties by non-declaration/mis-declaration to Customs. Similarly, the Customs have to
ensure that these passengers do not smuggle out foreign currency, antiques or other wildlife and
prohibited items or narcotics drugs or psychotropic substances. The Customs have also to ensure
enforcement of various other allied laws before any goods carried by the passengers on person,
in hand bag or accompanied baggage enter into the country or get out of the country.
13. Import/Export by post/courier:
13.1 Customs is charged with coordination with Postal authorities for giving Customs clearances after
appropriate checks on selective basis of various goods coming as post parcels, etc. Customs also
ensure that these postal mail/packets/parcels enter into the country in accordance with the
provisions of the Customs Act, 1962. Unless the goods brought by post are within the value limits
prescribed for free gift or free samples these have to be assessed to duties by Customs and the
same indicated to Postal authorities. The duties are collected before the Postal authorities deliver
the goods to addressees.
13.2 Imports/exports through couriers are governed by the Courier Imports and Exports (Clearance)
Regulations, 1998 and the Courier Imports and Exports (Electronic Declaration and Processing)
Regulations, 2010. These Regulations facilitate such goods in terms of quick Customs clearance,
after discharge of duties, if any, for delivery to the consignees. At few places dedicated Courier
terminals manned by Customs officers (akin to Air Cargo Complexes) are established to handle
courier cargo.
14. Citizen Charter:
14.1 Customs has committed in its Citizen Charter to provide to trade and industry time bound and
speedy cargo clearance facility, quick redressal of grievances, and inculcating in its officers' a
sense of service with courtesy, understanding, integrity, objectivity and transparency. Customs is
committed to render professional, efficient and prompt service to all stakeholders.