Government of India
Ministry of Finance, Department of Revenue
Office of the Principal Commissioner of Customs, (Chennai-III) (Preventive)
Custom House, No.60, Rajaji Salai, Chennai-600 001
F. No. II/(7)/17/2023-BOND-O/O PR COMMR-CUS-PREV-CHENNAI
Public Notice No. 29/2023 | Date: 28-08-2023
Subject:- Additional Documents for Warehousing of liquor to safeguard revenue-reg.
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The attention of Importers, Customs Brokers, Warehouse licencees, members of the trade and all other stakeholders are invited to the warehoused liquor being stored in the Customs Bonded Warehouse under the provision of warehousing bond executed by the importer.
2. You are aware that the importer who files Warehouse Bills of Entry are required to execute triple duty bond in accordance with the provisions of Section 59 of the Customs Act,1962, as amended. The importer, who has warehoused liquor, is clearing the goods either for home consumption by filing ex-bond bills of entry or through bond to bond transfer sale to other person. It is observed that in case of warehoused liquor, a person, not holding any state excise & VAT license, is purchasing liquor and selling another person as Bond to Bond sale. Due to this practice, it has been observed that warehoused liquor imported under one Master Bill of Entry (MBE) have undergone multiple bond to bond transfer which has resulted in difficulty to monitor the validity of warehoused liquor and duty payability by the final owner/ importer on left over liquor covered under MBE.
3. Further, on study of State Excise and VAT law of different states, following transpired:-
i. That State Government has enacted laws that limit the quantity of liquors which an individual can possess in one’s home. To possess quantities beyond the prescribed limit, individual is required to obtain a valid Excise License/Permit.
ii. For sale of liquor within a state, one is required to take appropriate excise license in that state.
iii. Furthermore, any person selling liquor, including removing liquor from warehouse for home consumption by ex-bond bill of entry or transferring the ownership of the liquor through bond to sale, are liable to pay VAT or CST, as applicable. Hence, the person should have valid CST and VAT License.
4. Section 59(5) off the Customs Act, 1962, as amended, deals with the transfer of warehouse goods form one person to another i.e Bond to Bond sale. The said provisions are reproduced below:-
“Where the whole of the goods or any thereof are transferred to another person. The transferee shall execute a bond in the manner specified in sub-section (1) of Sub-section (2) and furnish security as specified under sub-section (3)”.
5. From the above, it appears that the intention of the State law is to exercise effective control over movement of liquor and to pay appropriate excise duty & VAT/CST. That for such purchase and subsequent sale of liquor, the person must have State Excise licensee & VAT license.
6. The requirement of licence was also discussed with few liquor importers. Therefore, in view of challenges faced by customs from unscrupulous trader to curb customs duty evasion of bonded liquor, to effectively monitor the validity period of warehoused liquor and also to ensure that such sale & movement of liquor are in consonance of state Excise & VAT law, following additional guidelines are issued:-
i. Any person carrying out bond to bond purchase of liquor must have valid state excise and VAT license i.e person having valid state excise & VAT license can execute triple duty bond for warehousing of liquor in customs bonded warehouse of that in which one is having state excise & VAT license.
ii. At the time of submission of triple duty bond in the bond section, self attested copy of such licenses is also to be submitted.
iii. The seller importer of warehoused liquor while selling the liquor under bond to bond sale to ensure that buyer importer is in possession of valid state excise & VAT license of that state.
7. The guidelines mentioned at para ‘6’ above would not be applicable for importer filing warehouse bill of entry i.e original importer as well as sale to person having special Bonded warehouse license.
8. This public notice will come into effect immediately after issuance.
9. All trade associations/members of the Customs Brokers Association are requested to take note and publicize the contents of this Public Notice among their members/constituents.
10. For departmental officers, this may be treated as Standing Order.
11. Difficulty, if any, may be brought to the notice of the Additional Commissioner of Customs, Bond, Preventive Commissionerate, Chennai Customs.
MADUR SREEDHAR REDDY
PRINCIPAL COMMISSIONER
O/o Pr Commissioner-Customs-Preventive-Chennai
Copy to:
1. The Chief Commissioner of Customs, Chennai Customs zone, Custom House, Chennai for information.
2. Principal Commissioners/Commissioners of Customs (Airport, Import, Export, Audit, Air Cargo, General, Appeals I &II)
3. The Deputy Commissioner of Customs, EDI for uploading the Public Notice on official website.
4. The Chennai Customs Broker Association, Chennai-01
5. Notice Board.
