The steps in customs clearance are:

A. Filing of IGM (Inward Good Manifest)

This document containing the detail of the imported goods is filed by the master of the vessel or captain of the aircraft or their agent. The IGM is a crucial document as the date of filing signifies the date of entry into India and occurrence of the event of import. Very often, a policy may change after the event of import. In such cases, the import is protected from the policy change as the IGM has been filed before the change in policy.

B. Importer Exporter Code Number

The importer must have both the Importer Exporter Code Number as well as the Income Tax Permanent Account Number (PAN) based identity called BIN. This must be duty registered with the Customs House. The detail of this is available in the <IE_CODE>.

C. EDI Declaration Form and Value Declaration

The basic detail of the consignment is submitted to the Customs House by the CHA (Customs House Agency) who handles the customs clearance. The format for this prescribed in the <EDI_DECLRN_FORM_FOR_IMPORT>. The detail is fed into the customs computer through an authorised service centre. A CHA can feed this information directly through his own remote entry system. However, the terminal must be authorised by the Customs Commissioner. The Bill of Entry (BE) is generated automatically on the basis of this information in the EDI declaration.

The value has to be declared in the form <CUSTOM_DECLRTN_FORM>. Strictly speaking, the information in this is already contained in EDI declaration form. Nonetheless, the customs may ask for this declaration too.

D. Bill of Entry

A bill of entry (B/E) is presented in five copies to the Import Department either electronically under the EDI system or manually. The 5th copy (additional copy) called Advance Noting copy is to be submitted where advance Bill of Entry is presented before the arrival of the goods.

Bill of Entry type depends upon the type of import. The three types of Bill of Entry and the respective form are given in the table below. The forms are prescribed in the Bill of Entry Regulations, 1976. The Bill of Entry for home consumption is for goods on which the duty is being paid in cash at the time of clearance. In cases where duty payment is to be postponed, the Bill of Entry for warehousing is filed. Duty realization takes place when the final Bill of Entry for ex-bond clearance for home consumption is filed.

In addition to this, Bill of entry for Courier imports are also prescribed. These are on the lines of the Bill of Entry for Home Consumption. In the case of imports through the land custom stations, a separate application has to be made for import in <LAND_CUSTOMS_IMPORT_APPLCN>.

In the case of advance B/E following declaration is filed with the original B/E.

"We wish to clear the goods on arrival of the vessel. We request that our Bill of Entry be processed without waiting for the manifest. The vessel is due on ________. We shall formally present the Bill of Entry for noting as soon as the Import Manifest is filed. In case the Steamer Agent fails to deliver the IGM to the Import Department within 30 days from the date of advance noting of Bill of Entry, or the goods in question are not found to be listed in the import manifest, we shall surrender advance noted bill of entry to the Import Department for cancellation and shall present fresh Bill of Entry u/s 46 of the Customs Act, 1962 after the delivery of Import Manifest in the Custom House".

Signature of the authorised person

E. Shipping Documents

Copy of Bill of Lading/AWB & Invoice is accepted provided the same are certified as correct by the importers. Bank attested invoices may be required in the case of Letter of Credit shipments as documents must be routed through the bank under the Reserve Bank of India Exchange Control regulations. <AIRWAY_BILL> <INVOICES> <PACKING_LIST><BILL_LADING>

Other documents required for imports are:

Certificate of Origin <CERT_ORGN> which shows the country from where the goods were "born". As of now, there is no significance for this document since India does not discriminate between countries by prescribing MFN rates for WTO members and other rates for non-WTO members. The same rates of duty apply from all sources regardless of whether the particular country is a member of WTO or not. A separate Certificate of Origin is required if the preferential on account of Regional Trading Agreement is involved. The following Preferential Duty Trade Systems operate in India:

a.     South Asia Preferential Trading Agreement (SAPTA)

b.     Sri Lanka Free Trade Agreement

c.     Bangkok Agreement

d.     Global System of Trade Preferences (GSTP)

e.     Preferential Areas

Other documents specific to the particular item are required in most cases. This could be a Phytosanitary permit for agriculture items, a restricted item licence for goods under restricted category. The details of each of these are given under special notes in this database. Please see overview section for detail <IMPORT_OVERVIEW>

The importer is well advised to keep supporting documents handy as duty appraisal may require additional evidence in support of value and classification. These include catalogue of manufacturer, price list, detailed technical description of product, copies of bills of entry of the same or similar products already assessed.

The valuation of the goods is generally under WTO valuation rules and transaction value is accepted as the standard for determination of value for the purpose of customs duty. The detailed law on the subject is in the file <CUSTOMS_VALUATION>.

F. Verification of Documents

The Office Superintendent in Import Department verifies if all the documents are in order. In the case of prior bills of entry, dealing clerk puts Advance Noting stamp on all copies of B/E indicating running Sl. No. of Advance Noting Register. Thereafter he enters the relevant date on the systems and generate the "Thoka" number and date for the subject B/E. He puts the "Thoka" Number and date on all the copies of the B/E.

G. Appraisal

After the "Thoka" Number has been assigned, the B/E is forwarded to the Appraising Group for assessment. After the completion of assessment by Group Appraiser, the B/E is audited by the concurrent Audit Section and all other formalities including counter signature by Assistant Commissioner wherever required, are completed. The Group Appraiser makes assessment on the 5th copy of the B/E which is forwarded by group to Import Department.

H. Audit, Cash, Bond, Examination, Out Charge

Once the appraisal is over, the Bill of Entry is audited for mistakes in calculation or classification. The next stage is the payment of duty through the stipulated <TR6_FORM>.

The goods are finally examined by the shed appraiser who checks the identity of the goods and compares them with the documents. (In some cases, the goods may be inspected before appraisal. This is called first inspection. The purpose is to check the goods as the appraiser may have some doubts on the item description, classification or valuation).

The final document is the out charge slip issued by the shed appraiser. This is submitted to the custodian of the goods (the Port Trust or the Airport authority) who transfers possession to the importer or his agent. Last, the gate man checks the out charge slip with the goods and allows the consignment to pass the customs post for the domestic tariff area.

I. Mother vessels and feeder vessels

Now-a-days a large number of containers are transhipped at intermediate ports by the mother vessel to feeder vessels. Such feeder vessels move quite frequently between intermediate ports & Indian ports. The name of feeder vessels in not known to the importer in India till the last moment. In such cases, the advance noting of B/E will be allowed on the basis of master Bill of Lading of mother vessel. On arrival of feeder vessel, the final noting of B/E may be done on the basis of IGM of feeder vessel. The amended B/E contains the name of master vessel as well as feeder vessel.

J. Levy of interest on duty amount

In terms of Section 47(2) of the Customs Act, 1962, the importer is liable to pay interest on duty amount in case he or she fails to pay the import duty within seven days from the date of return of appraised B/E.

K. Rate of exchange

In terms of proviso clause to section 14 of customs act, the price is calculated with reference to rate of exchange as in force on the date on which B/E is presented under section 46.

The Rate of Exchange applicable is as in force on the date of 1st presentation of Bill of Entry whether on final entry basis or prior entry basis or advance noting. The rate of exchange for each month is notified by Department of Revenue. The table covers all major hard currencies in the international market such as the US Dollar, Euro, Japanese Yen, Pound Sterling, Australian Dollar and Singapore Dollar.