Export and Import

Procedures - Part II

Dr. Anupam Varma

 Central Excise Clearance
 All the excisable goods can be removed
from the factory only after their clearance
by the Central Excise Authorities.
 The procedure for clearance of excisable
goods for exports can be classified into the
following two categories:
1) Procedure for excise clearance in case of
exempted units
2) Procedure for excise clearance in case of
units other than exempted units
 Definition of Exempted Unit

 A manufacturing unit is exempt from the

levy of central excise if the value of the
goods cleared by it for home consumption
in a financial year is within the exemption
limit of Rs. 50 lakhs.
 The exempted units are not required to
obtain Central Excise Registration but have
to file a declaration with the Central Excise
Department. These units are then allotted
the Declarant’s Code Number.
 Excise Clearance Procedure –
Exempted Units

The exempted units should:

 Prepare a document for clearance of goods in form of
invoice with distinctive serial number indicating the
IEC Code and the Declarant’s Code Number
 State that the goods are being cleared for Exports.
 Give the details of the description of goods, name and
address of the buyer, destination, value, vehicle
number, date and approximate time of removal of
goods and progressive total value of all excisable
goods cleared for home consumption since the
beginning of the financial year.
 File quarterly statement of all the clearances with
CENTRAL EXCISE DEPT in prescribed form enclosing
the proof of export.
 Procedure of Excise Clearance – Units
Other Than Exempted Units

Export under claim of rebate of duty:

The excise duty is first paid and then the
exporter claims its refund after exportation
of goods.

Export under Bond:

In this case, the exporter is allowed clearance
of goods for export without payment of the
excise duty subject to the execution of
bond with security or surety for a sum
equivalent to the duty chargeable on the
goods to be exported.
 DOCUMETATION REQUIREMENT FOR
CENTRAL EXCISE CLEARANCE
The basic form used for seeking Central Excise Clearance
is ARE-1 (whether by land/sea/air/post)- Different
color of its 5 copies
 Original –White, returned by excise dept to exporter
immediately after endorsements and signature
 Duplicate-Buff, returned to the exporter immediately
after endorsements and signature.
 Triplicate-Pink, Sent to the officer with whom rebate
claim is to be filed
 Quadruplicate-Green, Retained for official records
 Quintuplicate-Blue, Optional copy - returned to the
exporter immediately after endorsements and
signature.
 Appointment of Clearing & Forwarding
Agents – Main Functions

Main functions of the agent are to

 Obtain customs clearance of goods,

 Ship them and

 Procure the relevant transport

document (Bill of Lading or Airway

Bill).
Appointment of Clearing & Forwarding
Agents – Other Important Functions
Perform a number of functions on behalf of
the exporter
 Provide specialized help by undertaking the
procedural and documentary formalities from
exporters warehouse to importer's warehouse
 Helping in packing, marking and labeling of
consignment,
 Arrangement for transport to the port, shipment
overseas, arranging insurance
 Customs clearance of cargo,

 Procurement of transport and other documents.

 Customs Clearance -
Objectives
Customs clearance of import/export goods
under Customs Act 1962
 Regulating export/import in a free &

transparent manner as per prescribed law

and control illegal trade
 To ensure authenticity of value of export

goods to check over/under invoicing

 To correctly assess and collect export/import

duty, if applicable.
 To compile data on cargo movements.
Procedure of Custom Clearance

Permission is granted in two stages

 Checking of shipping document in the

Customs’ office.
 Physical examination of goods in the shipment
shed
 Shipping Bill
 It is the main document on which customs
clearance given for allowing shipment
 Documents required for processing of
shipping bill:
a. GR forms in duplicate
b. Four copies of Packing List
c. Four copies of Invoices
d. Contract, L/C, Purchase Order
e. ARE 1 (both original & duplicate)
f. Inspection/Examination Certificate (contd.)
 Shipping Bill (Contd.)

 Four types:
a. White shipping bill: for export of duty free
goods
b. Green shipping bill: for export of goods
under claim for duty draw back
c. Yellow shipping bill for export of dutiable
goods
d. Pink shipping bill: for export of duty free
goods ex-bond (imported goods for re-
export)
Appraisal by Custom Authorities
 Customs Appraiser examines shipping
documents and appraises value:
a. That value & qty declared in shipping bill
is same as in export order/LC
b. That formalities reg exchange control,
pre-shipment quality inspection have been
duly completed.
 Customs Appraiser then makes
endorsement in duplicate copy of shipping
bill for Dock Appraiser about extent of
physical examination of cargo (contd.)
Appraisal by Custom Authorities
(contd.)

 Carting orders are obtained for bringing

export cargo to transit shed for physical
examination by Dock Appraiser
 Dock Appraiser records examination report
and if satisfied, makes “Let Export”
endorsement on duplicate copy of shipping
bill
 The documents then go to Preventive
Officer of customs dept who supervises
loading of cargo on board the vessel (contd.)
 Appraisal by Custom Authorities
(Contd)
 Preventive Officer endorses “Let Ship”
on duplicate copy of shipping bill
which is handed over to the Agent of
shipping company.
 This constitutes an authorisation by
Customs to the shipping company to
accept cargo on board the vessel.
Customs Clearance – Green
Channel Facility

 Green channel clearance facility to some

large and status holder exporters for import
of raw materials
 Clearance of goods is done without routine
examination
 Assessment of duty payable is made on basis
of documents submitted by importer along
with declaration about correctness
documents
 In case of doubt customs officials can go for
physical examination
Types of Duties
 Under customs laws, following are
various types of duties leviable:
 Basis Duty
 Additional Duty (Countervailing Duty)
(CVD)
 Anti-dumping Duty
 Protective Duty
 Duty on Bounty Fed Articles
 Export Duty
THANK YOU!!!!!!