export procedures and documents

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WELCOME

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INTRODUCTIONINTRODUCTION

DEFINITIONSDEFINITIONSIMPORT: Any goods brought into Indian territory from a IMPORT: Any goods brought into Indian territory from a

place outside India.place outside India.EXPORT: Any goods sent to another country from Indian EXPORT: Any goods sent to another country from Indian

territory territory GOODS: Means Vessels, Aircrafts and Vehicles, Stores, GOODS: Means Vessels, Aircrafts and Vehicles, Stores,

Baggage, Currency and negotiable instruments Baggage, Currency and negotiable instruments and any other kind of movable property.and any other kind of movable property.

INDIA: Includes territorial waters (waters extending INDIA: Includes territorial waters (waters extending in to the sea upto a limit of contiguous zone in to the sea upto a limit of contiguous zone specified in Territorial waters, Exclusive specified in Territorial waters, Exclusive Economic Zone, Continental shelf and Economic Zone, Continental shelf and Maritime Zones Act)Maritime Zones Act)

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TYPES OF GOODSTYPES OF GOODS

PROHIBITEDPROHIBITED:: Import / Export of these goods are Import / Export of these goods are completely banned/prohibcompletely banned/prohibitedited

RESTRICTED: RESTRICTED: Permitted to be imported / exported Permitted to be imported / exported subject to conditions lisubject to conditions like Licensing or ke Licensing or through only certain perthrough only certain permitted agencies mitted agencies etc. This category incluetc. This category includes passenger des passenger baggage.baggage.

FREE:FREE: In general anybody can import by In general anybody can import by following the procedures prescribed. following the procedures prescribed. Import is allowed without restrictions like Import is allowed without restrictions like license etclicense etc..

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DEPARTMENT OF CUSTOMS ENFORCES THE PROVISIONS OF THE FOLLOWING ACTS/REGULATIONS

1. Standard of Weights and Measures (Packaged Commodity) Rules, 1997. Imported packaged commodities shall carry the names, addresses of the importer, net quantity, month and year of packing and retail sales price etc..

1. Environment Protection Act.2. Indian Trade Merchandise Act.3. Arms Act.4. Wildlife Act.5. Plants, Fruits, Seeds (Regulation of import into India)

Orders (PFS) Order 1989 used under Destructive Insects and Pests Act.

6. The Live stock importation Act, 1898.7. Prevention Food Adulteration Act, 1954 etc.,

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CUSTODIANCUSTODIAN

The goods imported into India and exported out The goods imported into India and exported out of India are allowed through designated Sea of India are allowed through designated Sea Ports / Land Custom Stations / Airports. The Ports / Land Custom Stations / Airports. The goods so imported / exported are initially goods so imported / exported are initially deposited in the custody of Custodian such asdeposited in the custody of Custodian such asPort authorities for goods imported through sea.Port authorities for goods imported through sea.Custodians for goods imported by air Custodians for goods imported by air

Air Port Authority Of IndiaAir Port Authority Of IndiaAir India or STC etcAir India or STC etc

For places other than points of landingFor places other than points of landingInland Container Depot (ICD)Inland Container Depot (ICD)--M/s CONCOR at Hyderabad.M/s CONCOR at Hyderabad.Container Freight Station (CFS)Container Freight Station (CFS)--M/s CWC at Hyderabad.M/s CWC at Hyderabad.

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Export Promotion Schemes• DUTY EXEMPTION/REMISSION SCHEMES:-

1) Advance Authorisation Scheme (DEEC/Adv. Licence)2) Duty Free Replenishment Scheme (upto 4/06)3) DEPB Scheme4) Duty Free Import Authorisation (DFIA w.e.f 1.5.06)

• EXPORT PROMOTION CAPITAL GOODS SCHEME(EPCG)• EOU/STP/EHTP/Biotechnology Parks• SPECIAL ECONOMIC ZONES (separate Act & Rules framed)• FREE TRADE AND WAREHOUSING ZONES• DEEMED EXPORTS• SPECIAL SCHEMES UNDER EXPORT PROMOTION

• SERVED FROM INDIA SCHEME ( formerly DFEC)• VISHESH KRISHI AND GRAM UDYOG YOJANA• FOCUS MARKET SCHEMES

(Export to certain specified countries)• FOCUS PRODUCT SCHEMES

(Export of Specified commodities)

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CENTRAL EXCISE CENTRAL EXCISE PROCEDUREPROCEDURE--EXPORTSEXPORTS

There are two types of proceduresThere are two types of proceduresExport of Goods under BondExport of Goods under Bond

Execution of LUT by the Manufacturer ExpExecution of LUT by the Manufacturer ExpExecution of B1 bond with security in the Execution of B1 bond with security in the case of Merchant Exporter or Manufacturer case of Merchant Exporter or Manufacturer Exporter.Exporter.Obtaining the CT1 Certificate CT1 against Obtaining the CT1 Certificate CT1 against the B1 bond by the Merchant Exporterthe B1 bond by the Merchant Exporter

Export of goods on payment of C. Ex duty Export of goods on payment of C. Ex duty under claim for Rebate of Dutyunder claim for Rebate of Duty

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Preparation of ARE 1/ARE 2 Document (5 Copies), Preparation of ARE 1/ARE 2 Document (5 Copies), C.Ex Invoice/C.Ex Invoice/PkgPkg ListListManner of Clearance of Export goods Manner of Clearance of Export goods Under the supervision of Central Excise officerUnder the supervision of Central Excise officer

ororUnder Self Sealing and Self Certification of the Under Self Sealing and Self Certification of the

Manufacturer at the place of dispatch.Manufacturer at the place of dispatch.

In the case of goods examined & sealed by the In the case of goods examined & sealed by the Central Excise Officer ARE 1 shall be accompanied Central Excise Officer ARE 1 shall be accompanied by the Examination Report (Cir No. 630/21/2002by the Examination Report (Cir No. 630/21/2002--Cx Cx dtdt 27.3.2002).27.3.2002).

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In the case self sealed goods the exporter shall In the case self sealed goods the exporter shall certify on all copies of ARE 1 that the description certify on all copies of ARE 1 that the description and value of the goods have been checked and goods and value of the goods have been checked and goods have been packed and sealed under his supervision.have been packed and sealed under his supervision.Self sealed and Self Certified goods are subjected to Self sealed and Self Certified goods are subjected to examination norms at the port of export as examination norms at the port of export as prescribed by the Customs. prescribed by the Customs. ARE 1 (ARE 1 (OriOri & Dup) send to the place of export along & Dup) send to the place of export along with the goods, Tri & Quadruplicate to the Range with the goods, Tri & Quadruplicate to the Range Office for certification and forwarding to AC before Office for certification and forwarding to AC before whom the bond was executed. Quintuplicate is whom the bond was executed. Quintuplicate is Optional kept as exporter copy.Optional kept as exporter copy.

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Examination of goods at the Port of Export Examination of goods at the Port of Export

The ARE 1 copies received with goods at the port will The ARE 1 copies received with goods at the port will verified by the Customs verified by the Customs w.r.t.w.r.t. quantity and identity of the quantity and identity of the goods presented for examination and after allowing the goods presented for examination and after allowing the goods for export certifies on the copies of the ARE 1 citing goods for export certifies on the copies of the ARE 1 citing the SB No and date and other particulars of export and the SB No and date and other particulars of export and return the Original copy of ARE1 to the Exporter and return the Original copy of ARE1 to the Exporter and Duplicate to the Central Excise Officer by post or in a Duplicate to the Central Excise Officer by post or in a sealed cover though the exporter.sealed cover though the exporter.Procedure is prescribed for admitting proof of export, Procedure is prescribed for admitting proof of export, allowing re credit in the bond/LUT or for granting rebate of allowing re credit in the bond/LUT or for granting rebate of duty paid. duty paid. Simplified procedure is also prescribed for exempted unitsSimplified procedure is also prescribed for exempted units

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Procedure for Customs ClearanceProcedure for Customs ClearanceThe following documents are to be presented The following documents are to be presented to the Customs for clearance of goods.to the Customs for clearance of goods.Bills of Entry (For ImportsBills of Entry (For Imports--Section 46 of CASection 46 of CA--62)62)Shipping Bills (For Exports)Shipping Bills (For Exports)Baggage Declaration (For Pass Baggage) Baggage Declaration (For Pass Baggage) -- OralOralBaggage Declaration (For Unaccompanied Baggage Declaration (For Unaccompanied Baggage)Baggage)The import duty is assessed and on payment of The import duty is assessed and on payment of duty, the importer’s goods are allowed clearance duty, the importer’s goods are allowed clearance into India.into India.Generally there is no customs duty on exports Generally there is no customs duty on exports except certain except certain cessescesses levied under authority of levied under authority of other Acts.other Acts.

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Export Procedures

• Registration: All exporters must obtain IEC (Import Export Code number)from DGFT. Under EDI system, IEC is received by the Customs from the DGFT online.

• Exporters also required to register authorized foreign exchange dealer code and open a current a/c in the designated bank for credit of

• duty drawback if any. • For availment of EPCG & DFIA, ADV Licence

export promotion schemes, exporters need to get their licenses registered.

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Export ProceduresExport ProceduresProcessing of Shipping BillProcessing of Shipping Bill-- NonNon--EDI:EDI:

Shipping bill has to be filed in the format prescribedShipping bill has to be filed in the format prescribedDifferent forms of shipping bills have been prescribed Different forms of shipping bills have been prescribed for different typesfor different typesS/Bs are required to be filed along with all original S/Bs are required to be filed along with all original documents like invoice, ARdocuments like invoice, AR--E1, packing list etc.E1, packing list etc.S/B will be assessed on the basis of declaration if S/B will be assessed on the basis of declaration if otherwise in order.otherwise in order.Goods should be presented for examination at the Goods should be presented for examination at the Docks Examination unitDocks Examination unit

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Export ProceduresProcessing of Shipping Bills-EDI:

Declaration in prescribed format are to be filed through the Service Centers.

A checklist is generated for verification of data by the exporter/CHA. After verification, the data is submitted to the System and the System generates a Shipping Bill No, which is endorsed on the printed checklistNo copy of shipping bill is given at this stage.The exporter can verify the status of the shipping bill at the Service Center. The Appraising Officer/ Superintendent will verify the FOB value declared, the RITC No etc., and the bill will be assessed in the system it self. In the case of DEPB Scheme SBs the DEPB sl. no. declared and for the DBK Scheme the DBK Schedule sl.no. declared are verified.

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Export ProceduresExport ProceduresIf any query is issued, the same may be replied through the If any query is issued, the same may be replied through the service center or in case of service center or in case of CHAsCHAs having EDI connectivity having EDI connectivity through their respective terminals or through ICEGATE )through their respective terminals or through ICEGATE )Customs Examination: Customs Examination: Goods have to be presented for Goods have to be presented for examination with all the documents. examination with all the documents. Examination is done with reference to the declaration made in Examination is done with reference to the declaration made in the Bill and the actual quantity, value etc.the Bill and the actual quantity, value etc.The packages to be examined is determined by the systemThe packages to be examined is determined by the systemThe Customs Officer enters the examination report in the The Customs Officer enters the examination report in the SystemSystemSuperintendent or Appraiser will give “let export” order, if Superintendent or Appraiser will give “let export” order, if they are satisfied with the documents and the same are tallied they are satisfied with the documents and the same are tallied with the physical examination.with the physical examination.

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Export ProceduresExport ProceduresIf there is any variation between the check list and the If there is any variation between the check list and the physical examination of the goods, matter will be physical examination of the goods, matter will be referred to the concerned Asst. Commissionerreferred to the concerned Asst. CommissionerStuffing/Loading of Goods in Container: Stuffing/Loading of Goods in Container: The exporter or his agent must hand over the exporter The exporter or his agent must hand over the exporter copy of the duly signed shipping bill to the steamer copy of the duly signed shipping bill to the steamer agent for stuffing. In the case of containerised cargo, agent for stuffing. In the case of containerised cargo, the same is done under preventive supervision.the same is done under preventive supervision.Customs Preventive Officer supervising the loading Customs Preventive Officer supervising the loading of the container may give “Shipped on Board” of the container may give “Shipped on Board” endorsement on the exporter copy of the S/B.endorsement on the exporter copy of the S/B.

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MISTAKES IN DOCUMENTATIONMISTAKES IN DOCUMENTATION

Furnishing of incorrect and incomplete particulars in the Furnishing of incorrect and incomplete particulars in the Central Excise Documents Viz. ARE1/ARE2, Central Central Excise Documents Viz. ARE1/ARE2, Central Excise Invoices, Excise Invoices, PkgPkg List and Customs documents Viz. List and Customs documents Viz. AnnexuresAnnexures filed in the Service Centre, Export Invoice, filed in the Service Centre, Export Invoice, Export Export PkgPkg List and Shipping Bills generated based on List and Shipping Bills generated based on these documents leads to many problems at the time of these documents leads to many problems at the time of export goods. export goods.

Errors generally committed:Errors generally committed:The description of the goods, unit of quantity, The description of the goods, unit of quantity, classification of the Chapterclassification of the Chapter--Heading shown in the ARE1 Heading shown in the ARE1 and C Ex Invoice do not tally with the particulars and C Ex Invoice do not tally with the particulars furnished in the Shipping Bill. furnished in the Shipping Bill.

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Particulars often incorrectly declaredParticulars often incorrectly declared1.1. Quantity Quantity visvis a a visvis Units of QtyUnits of Qty2.2. Gross weight & Net weightGross weight & Net weight3.3. Invoice No/Date & ARE 1 No in the SBInvoice No/Date & ARE 1 No in the SB4.4. Port of Destination/ DischargePort of Destination/ Discharge5.5. Description of goods Description of goods 6.6. Currency Currency VizViz USD/GBP/Aus D/Euro etcUSD/GBP/Aus D/Euro etc7.7. CIF Value/FOB ValueCIF Value/FOB Value8.8. Export promotion Scheme opted.Export promotion Scheme opted.

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Quantity Quantity visvis a a visvis unit of qtyunit of qtyQty is required to be furnished in Cubic Meters with Qty is required to be furnished in Cubic Meters with declaration of length x Breadth x width (thick ness) declaration of length x Breadth x width (thick ness) in the case of Granite/Marble Slabs and Tiles for in the case of Granite/Marble Slabs and Tiles for verifying the eligibility of DEPB rate, but the qty is verifying the eligibility of DEPB rate, but the qty is declared in Square Meters.declared in Square Meters.The description of packing materials used for packing The description of packing materials used for packing the export product is relevant for granting DEPB in the export product is relevant for granting DEPB in certain cases. Failure to give the certain cases. Failure to give the Pkg Pkg particulars particulars result in denial of benefit. Ex packed in cartoons/ result in denial of benefit. Ex packed in cartoons/ plastic film etc.plastic film etc.

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Gross & Net Weight:Gross & Net Weight:Care has to be taken to correctly declare the Care has to be taken to correctly declare the Gross Gross weight and Net weight in the Excise documents weight and Net weight in the Excise documents such as ARE1, Invoice and such as ARE1, Invoice and PkgPkg List and the said List and the said weight should tally with the Gross and Net Weight weight should tally with the Gross and Net Weight declared in the Shipping Bill. This mistake is declared in the Shipping Bill. This mistake is noticed in the case of Granite/Marble noticed in the case of Granite/Marble slabsandslabsand tiles. tiles. The LINER insists for the correct The LINER insists for the correct decldecl of the Weight of the Weight in the SB where as the weights shown in the SB and in the SB where as the weights shown in the SB and Excise documents don’t tally. If this mistake is Excise documents don’t tally. If this mistake is noticed after the noticed after the LEO is given then the LEO is given then the amendment of particulars in SB becomes time amendment of particulars in SB becomes time consuming and lengthy procedure.consuming and lengthy procedure.

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PORT OF DESTINATIONPORT OF DESTINATIONThe declaration of the port of destination The declaration of the port of destination properly in the Shipping Bill is very properly in the Shipping Bill is very important. important. The Exporters / The Exporters / CHAsCHAs are failing to distinguish are failing to distinguish the difference between Country of Destination and the difference between Country of Destination and Port of Destination. One Port of Destination. One Important Point to be Important Point to be remembered is to declare the Port of destination remembered is to declare the Port of destination basing the Purchase Order or any basing the Purchase Order or any despatch despatch instructions instructions given by the Foreign Buyer. Such given by the Foreign Buyer. Such declaration should not be based on assumptions such declaration should not be based on assumptions such as basing on what as basing on what is declared in previous export is declared in previous export document or basing on the Country Destination. document or basing on the Country Destination.

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Description:Description:

The Description of the Chemicals/Medicines The Description of the Chemicals/Medicines (P & P) is given in general terms as brand (P & P) is given in general terms as brand name etc where as for claiming the DEPB / name etc where as for claiming the DEPB / DBK benefits the actual chemical name has DBK benefits the actual chemical name has to be given in the export documents. Same is to be given in the export documents. Same is the case with the Machinery/ Electrical the case with the Machinery/ Electrical Machinery/ Electrical Goods/ Electronic Machinery/ Electrical Goods/ Electronic Goods.Goods.

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Currency & Value:Currency & Value:Incorrect declaration of unit of CurrencyIncorrect declaration of unit of Currency Viz Viz USD, USD, Euro, Euro, GBP is another important field. The GBP is another important field. The exchange rates are different for each currency.exchange rates are different for each currency.Incorrect declaration of the CIF Value and FOB Incorrect declaration of the CIF Value and FOB Value. If the Value as per the Purchase Order is Value. If the Value as per the Purchase Order is FOB and if exporter declares it as CIF value/ FOB and if exporter declares it as CIF value/ Invoice Value and exhibits Insurance and Freight in Invoice Value and exhibits Insurance and Freight in the SB then automatically the FOB value arrived at the SB then automatically the FOB value arrived at in the SB will be less than the actual FOB Value in the SB will be less than the actual FOB Value since the freight & Insurance is deducted twice in since the freight & Insurance is deducted twice in the system. The FOB Value has great relevance to the system. The FOB Value has great relevance to the DBK Scheme & DEPB Scheme since the the DBK Scheme & DEPB Scheme since the benefit is given based on the FOB Value.benefit is given based on the FOB Value.

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Export Promotion Scheme : Export Promotion Scheme : The exporter has to decide before hand whether the The exporter has to decide before hand whether the exports are under FREE SB (no export incentive exports are under FREE SB (no export incentive scheme) or under any Export Scheme scheme) or under any Export Scheme VIzVIz. . DEPB/DFIA/DBK/EPCG etc., and file the bill DEPB/DFIA/DBK/EPCG etc., and file the bill accordingly. The Conversion of SB from Free Bill accordingly. The Conversion of SB from Free Bill to any Scheme Bill is not permitted as per the Board to any Scheme Bill is not permitted as per the Board Circular. The conversion of SB from one Export Circular. The conversion of SB from one Export Scheme to another Export Scheme is not allowed as Scheme to another Export Scheme is not allowed as matter of routine but examined case by case by matter of routine but examined case by case by Commissioner. Hence all the care has to be taken to Commissioner. Hence all the care has to be taken to avoid disappointment and delay in getting the avoid disappointment and delay in getting the benefit. benefit.

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The above cited mistakes are simple and rectifiable The above cited mistakes are simple and rectifiable mistakes by bestowing ones attention in furnishing mistakes by bestowing ones attention in furnishing the correct particulars of description, Qty, unit of the correct particulars of description, Qty, unit of measurement, Currency, FOB/CIF Value, measurement, Currency, FOB/CIF Value, DEPB/DBK Schedule DEPB/DBK Schedule SlSl.No, Port of destination, .No, Port of destination, Country of destination, Gross weight/ Net weight Country of destination, Gross weight/ Net weight in the Annexure filed in the Service Centre, Central in the Annexure filed in the Service Centre, Central Excise Documents, Customs Documents as the Excise Documents, Customs Documents as the case may be.case may be.

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MISDECLARATION IN DEPB/DBK SCHEMEMISDECLARATION IN DEPB/DBK SCHEMEFew cases areFew cases are

•• Export of chalk powder by declaring them as NAPROXIN Export of chalk powder by declaring them as NAPROXIN bulk drug.bulk drug.

•• Export of starch powder by declaring them as bulk drugs. In Export of starch powder by declaring them as bulk drugs. In the said case the top layer is filled with the bulk drug and thethe said case the top layer is filled with the bulk drug and thelower layers with starch powder.lower layers with starch powder.

•• The rags and worth less ready made goods are attempted to The rags and worth less ready made goods are attempted to be exported as Ladies dresses to claim the DBK benefit.be exported as Ladies dresses to claim the DBK benefit.

•• Claiming the export benefits by tampering with export Claiming the export benefits by tampering with export documents, by creating the fictitious Customs documents documents, by creating the fictitious Customs documents such as Shipping Bills, Transfer Release Advises (T R s).such as Shipping Bills, Transfer Release Advises (T R s).

•• In many cases, the goods exported will not be taken delivery In many cases, the goods exported will not be taken delivery abroad, no money will be received from foreign country abroad, no money will be received from foreign country meanwhile exporter avail the export benefit and disappears.meanwhile exporter avail the export benefit and disappears.

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MisdeclarationMisdeclaration in ADVANCE in ADVANCE LICENSE SCHEMELICENSE SCHEME::

Certain unscrupulous exporters obtain Certain unscrupulous exporters obtain Adv License from DGFT and import raw Adv License from DGFT and import raw materials with actual user condition and the materials with actual user condition and the said inputs will be sold in the local market said inputs will be sold in the local market and disappear or they don’t fulfill the export and disappear or they don’t fulfill the export obligation. obligation.

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Risk Management System:Risk Management System:

RMS will be available only for RMS will be available only for specified categories of importers.specified categories of importers.Clearance will be allowed on selfClearance will be allowed on self--

assessment.assessment.No examination except marks & numbers.No examination except marks & numbers.Concurrent audit will be replaced by Post Concurrent audit will be replaced by Post

clearance audit.clearance audit.RMS will be introduced at ACC shortly & RMS will be introduced at ACC shortly &

ICD later.ICD later.

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THE END