Circular No. 04/2017-Customs
Government of India
Ministry of Finance
Department of Revenue
(Central Board of Excise & Customs)
Room No. 227B, North Block,
New Delhi, the 16 February, 2017.
All Principal Chief Commissioners/Chief Commissioners of Customs /Customs(Preventive) All Principal Chief Commissioners / Chief Commissioners of Customs & Central Excise Principal Director General / Director General, DRI
All Principal Commissioners / Commissioners of Customs / Customs (Preventive) All Principal Commissioners I Commissioners of Customs & Central Excise.
Subject: Expansion of 24×7 customs clearance and clarification of levy of MOT charges in CFSs attached to 24×7 ports-reg.
CBEC had on a pilot basis introduced 24×7 customs clearance at 4 designated Air cargo complexes and 4 sea ports in respect of facilitated Bills of Entry and factory stuffed containers and goods shipped under free shipping bills [Circular No. 22/2012-Cus refers].
Subsequently, vide instruction from F. No. 450/25/2009-CusIV dated 31.5.13, the facility of 24×7 clearance [on pilot basis] was simultaneously extended to another 13 Air cargo complexes and to include all shipping bills .free or otherwise filed at the said Air cargo complexes.
Since the clearances were run on pilot basis, therefore, on 31.12.14 [Circular 191/2014-Customs], CBEC allowed the facility of 24×7 customs clearance for goods covered by facilitated Bills of Entry and specified exports i.e. factory stuffed containers and goods shipped under free shipping bills on permanent basis at the designated 18 Sea Ports (including the 4 sea ports designated earlier). Currently, this facility is available at 19 Sea ports with Krishnapatnam having been added later. On the airside also this facility was made available on permanent basis for facilitated Bills of Entry and all shipping bills at the designated 17 Air Cargo Complex.
2. Providing logistics support like machinery/ cranes for container movement, labour etc is the primary responsibility of Custodian or the Customs broker/ importer. CBEC initially restricted the 24×7 to facilitated bills of entry only, keeping in view the time needed to be given to all the stakeholders to gear up for 24×7 clearance. More than two years have passed since CBEC has introduced 24×7 clearance. This much lead time should be enough for the all the stakeholders to put necessary arrangements in place to enable round the clock clearance of all import cargo and not just facilitated one. Customs is anyways operating 24×7 at designated ports/ airports. Therefore, it has been decided to extend 24×7 customs clearance to all bills of entry and not just facilitated bills of entry.
3. Board has amended the Customs (Fees for Rendering Services by the Customs Officers) Regulations, 1998 to provide that at 24×7 customs ports and airports, no fee i.e. merchant overtime fee (MOT) shall be collected in lieu of the services rendered by the customs officers. Thus, as on date no MOT charges are required to be collected in respect of the services provided by the customs officers at 24×7 customs ports and airports. Reference has been received seeking clarification as to whether MOT charges are to be collected in respect of stuffing of export goods at CFSs.
(a) The issue has been examined in the Board. It is observed that a designated 24×7 sea port can have a number of CFSs attached to it. While Board has already exempted MOT charges at 24×7 ports, the reference in essence seeks clarification as to whether MOT exemption can be extended to attached CFSs as well.
(b) CFSs are an extension of the Port. In the overall ecosystem of Customs clearance, CFSs have played an important role in faster clearance of EXIM goods. As a result, bulk of regulatory activity other than appraising, has shifted to CFSs.
(c) Factory stuffed containers are already covered under 24×7 operations, therefore, MOT charges are not required to be paid in lieu of services (like verification of seals etc) rendered by customs officers at CFSs in respect of such containers.
(d) Other than at the manufacturing premises, stuffing can inter-alia also occur at CFSs for export against free shipping bills or otherwise. In the case of sea ports, free shipping bills are already covered under 24x 7 scheme while the goods exported against a claim to benefit are not. Considering that the customs work carried out in the CFSs is actually an extension of the clearance activity at the port, therefore, logically no MOT charges should be leviable in lieu of services rendered by customs officers within the CFS premises even in the case of export against a claim to benefit.
(e) Accordingly, it is clarified that no MOT charges would be collected at CFSs attached exclusively to 24×7 ports in lieu of services rendered within the CFS. This will bring the MOT collection norms at par with the situation on the air side which cover all shipping bills free or otherwise.
4. Difficulty faced, if any, may be brought to the notice of the Board.