Circular No. 56/2000-Cus

Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs

New Delhi, the 5TH July, 2000

Subject : Transshipment of containers from Gateway ports to ICDs/CFSs

I am directed to invite your attention to the “Goods Imported (Condition of Transshipment) Regulations, 1995”. Under the said Regulations, a continuity bond is to be executed by the transporter/custodian/declarant for safe carriage of the goods from the gateway port to the ICDs/CFSs. The bond is discharged when the landing certificate, i.e. receipt of the goods at the destination is produced by the transporter/custodian/declarant. The Regulation provide that an amount equivalent to the value/market price of the imported goods is to be forfeited if the said landing certificate is not produced within the stipulated period.

2. In August, 1999, the Mumbai Custom House had issued a Public Notice (No. 93/99 dated 17-8-1999) laying down a modified procedure for issuance of transshipment permit, whereby steamer agents were required to submit one copy of invoice of each consignment in the Sub-Manifest for the purpose of working out the value and duty liability of the transshipment cargo. Against the said Public Notice a number of representations/references was received from the trade as well as the Ministry of Commerce. Considering these representations, the implementation of the said Public Notice was kept in abeyance. To sort out the issue, a meeting was held on 9-6-2000 under the chairmanship of the Member (Customs), which was attended by the officers of the Department, Ministry of Commerce, CONCOR, CWC as well as the representatives of Steamer Agents/Shipping lines.

3.  In the meeting it was decided that the Steamer Agents would not be asked to submit the copies of invoices of the cargoes to be transhipped from gateway ports to ICDs/ CFSs, and that the transhippers would instead execute bonds based on notional value arrived at on principles as prescribed in Circular No. 34/2000-Cus., dated 3-5-2000 for transshipment through coastal vessels.

4. In view of the above, it has been decided that for the transshipment of containers from gateway ports to ICDs/CFSs a bond with security of 25 percent of bond value shall be taken from the carriers. To avoid multiplicity of bonds, the carriers may execute mother bonds instead of individual bonds. Such bonds will be accepted and maintained by the Commissioner of Customs at the port of origin. The mother bonds will be like funning bonds. The mother bond can be debited at the time of transshipment of import/export containers at the port of origin, and these will be credited on receipt of proof of safe landing of containers at the port of destination. The value of mother bond can be arrived on the basis of the average number of containers carried per trip, the time taken for submission of proof of safe landing of containers at the destination ICDs/CFSs, frequency of such transshipment as well as average value of cargo per containers transshipped in the past.

5. To avoid blockage of huge sum of carriers money towards security furnished to Customs, it has been decided that the bank guarantee so furnished should be released as soon as proof of safe landing of containers at destination ICDs/CFSs is submitted by the carriers. Although, the bond taken from the carriers will be of the nature of running bond, the bank guarantee furnished towards security may be taken of each trip and released after receipt of proof of safe landing of containers carried in that trip at destination ICDs/CFSs. Therefore, it can be said that the bond will be of the nature of running bond, but security can be furnished for each trip separately. This will reduce the burden on carriers and at the same time revenue will be safeguarded.

6. These instructions may be brought to the notice of all concerned by way of issuance of suitable Public Notice/Standing Orders.

7.  Difficulties, if any in implementation of these instructions, may be brought to the notice of the Board. Kindly acknowledge receipt of this Circular.

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