The Central Board of Indirect Taxes and Customs (CBIC) has removed the requirement for shipping lines to submit manual documents and statements for containers imported duty free, as per a new notification released on Saturday. The move is aimed at improving ease of doing business and supporting the government’s “One Nation One Port Process” initiative.
What is the existing system?
Containers used in international trade are allowed to be imported without payment of customs duty under, provided they are re-exported within six months or the applicable customs duty is paid if the conditions are not met. Shipping lines, Non Vessel Owning Common Carriers (NVOCCs) and steamer agents execute a customs bond to avail this exemption.
Until now, carriers were also required to manually inform Customs about the identification and movement of these containers outside the customs area. Customs officials would then manually debit or credit the bonds based on electronic Import General Manifest (IGM), Sea Arrival Manifest (SAM), Export General Manifest (EGM) and Sea Departure Manifest (SDM) filings.
What changes now?
The new rule change eliminates the need for these manual submissions. Instead, the Directorate General of Systems (DG Systems) will electronically generate reports identifying containers that have not been re-exported within the prescribed six-month period. These reports will be made available on the ICEGATE portal for use by shipping lines and Customs officers to initiate appropriate action under the Customs Act, 1962.
Importantly, shipping lines and NVOCCs will continue to execute the prescribed customs bond, but the cumbersome process of manually debiting and crediting the bond for every container movement will be discontinued.
Why is it significant?
The move is expected to reduce compliance costs and turnaround time for shipping companies by replacing repetitive paperwork with automated monitoring. Since Customs already receives electronic manifest data, the new system leverages existing digital records rather than requiring duplicate manual reporting.
The reform also aligns with the Ministry of Ports, Shipping and Waterways’ One Nation One Port Process initiative, which envisages integrated digital systems across ports to eliminate manual approvals and physical verification of container movements. As part of this transition, port and terminal operators have been asked to maintain electronic records of containers entering and exiting customs areas and work with DG Systems to develop integrated electronic gate systems.
Source from: https://cfo.economictimes.indiatimes.com/news/tax-legal-accounting/cbic-ends-manual-paperwork-for-duty-free-import-containers-heres-what-changes/132355309
