Procedure to be followed by existing licencees for application of New Warehousing Bond Licences under Section 57/ Section 58/ Section 58A of the Customs Act, 1962

! G4 OFFICE OF THE COMMISSIONER OF CUSTOMS (IMPORT-II), NEW CUSTOM

HOUSE, BALLARD ESTATE, MUMBAI - 400 001.

F.NO: S/6-GEN-2¢ 7 /2016 -/4 Bog

Date: .07.2016

PUBLIC NOTICE NO : “73

/2016

Sub : Procedure to be followed by existing licencees for application of New Warehousing Bond Licences under Section 57/ Section 58/ Section 58A of the Customs Act, 1962, pursuant to the enactment of the Finance Bill, 2016 - reg.

Attention of all Importers/ Exporters/Bonders/ CHAs and all concerned is invited to the New Warehousing Regulations issued by the Board which are as follows :

1. Public Warehouse Licensing Regulations, 2016

2. Private Warehouse Licensing Regulations, 2016

3. Special Warehouse Licensing Regulations, 2016

4. Warehoused Goods Removal Regulations, 2016

5. Warehouse (Custody and Handling of Goods) Regulations, 2016

6. Special Warehouse (Custody and Handling of Goods) Regulations, 2016 7. Notification No. 66/2016-Cus(NT) dated 14.05.2016 under Sub-section (2) of Section 58A.

The documents required to be submitted/ procedure to be followed by the existing licencees for application of New Warehousing Bond Licences under the Revised Section 57/ Section 58/ Section 5S8A of the Customs Act, 1962, are enumerated in the enclosed Annexures ‘A’, ‘B’ & ‘C’.

It is mandatory for all existing licencees to comply with the same. The documents so required to be submitted should reach this office before 31.07.2016 without fail, so that the transition to the new licences can be made effective w.e.f. 13.08.2016.

Difficulties, if any, in the implementation thereof, may be brought to the notice of Shri Rasaal Dwivedi, Dy. Commissioner of Customs, Import Bond, New Custom House, Ballard Estate, Mumbai —- 400 001 (e-mail ID : rasaal.dwivedi@gov.in) immediately.

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----- Start of picture text -----<br> (B. BHATTACHARYA)<br>PR. COMMISSIONER OF CUSTOMS<br>NCH/ MUMBAI.<br>----- End of picture text -----<br>

• Copy to: 1. The Chief Commissioner of Customs, Mumbai Zone-l. 2. The Commissioner of Customs (Export), Mumbai Zone - I 3. All the Addl./ Jt. Commissioners of Customs, Mumbai Zone-| 4. All the Dy./ Asstt. Commissioners of Customs, Mumbai Zone-! 5. All the Trade Associations 6. The Dy. Commissioner of Customs (EDI) - to upload the same on the website.

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ANNEXUREa SECTION ‘) PUblc gn PUBLIC WAREHOUSES “UDlic“WareWare house——Licensing Regulations,cs oe Wotification 2016 no. 70/2016)

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• L.A Coveri . -OVer Stan nice! a alon , at letter Stating their intent to apply for a Public warehouse licence,

• with their business background and other relevant details.

2. Solvency Certificate from a Scheduled Bank for a sum of Rs. 2 crores [Central /State Government/ Uniorr Territory undertakings/ ports notified under the Major Port Trusts Act, 1963 (38 of 1963) exempted].

3. An All Risk Insurance policy that includes natural calamities, riots, fire, theft, skilful pilferage, commercial crimes in favour of President of India for a sum equivalent to the amount of duty involved on the dutiable goods proposed to be Stored in the Public Warehouse at any point of time.

4. The applicant shall provide an Undertaking ( on judicial stamp paper - duly notarised) binding himself to pay any duties, interest, fine & penalties payable in respect of warehoused goods under sub-section (3) of Section 73(A) or under the Warehouse (Custody and Handling of Goods) Regulations, 2016.

5. The applicant shall provide an Undertaking ( on judicial stamp paper - duly notarised) indemnifying the Principal Commissioner of Customs or Commissioner of Customs, as the case may be, from any liability arising on account of loss suffered in respect of warehoused goods due to accident, damage, deterioration, destruction or any unnatural cause during their receipt, delivery, Storage, despatch or handling.

6. The applicant shall Provide an Undertaking to comply with such terms and conditions as may be specified by the Principal Commissioner of Customs or Commissioner of Customs, as the case may be.

7. A Licencee shall appoint a Warehouse keeper who has sufficient experience in warehousing operations and customs procedures, to discharge functions under the new regulations on his behalf. (Notfn. No. 68/2016).

8. The warehouse keeper shall obtain a Digital signature from authorities licenced by the Controller of Certifying Authorities for filling of electronic documents required under the Act, rules or regulations (Notfn. no. 68/2016).

   • (a) A licencee shall provide at the warehouse in respect of which a licence has been issued, such facilities, equipment and personnel as are sufficient to control access to the warehouse and provide secure storage of the goods in it, including

   • (i) Doors and other building components of sturdy construction; (ii) secure locks on doors and windows; (iii) signage that prominently indicates that the site or building is a Customs Bonded Warehouse

   • (b) adequate personnel, equipment and space for the examination of goods by officers of customs, and

   • (c) computerised system for accounting of receipt, storage, operations and removal of goods (Notfn. No. 68/2016).

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• (d) The softwar€ lor maintenancec inter %e of electroniclen Ha records must incorporate4 the Berta, ia Pi audit jtrail" which means a secure, computer generated,. timempe electronic record that allows for the course of events relating to the

• acon, modification, or deletion of an electronic record and includes actions at the record or system level, such as, attempt to access the system or delete or modify a record. (Circular No. 25/2016).

• 9. The data prescribed in the forms (A - statement for live bonds and for B - for time expired bonds)shall be maintained electronically (Circular No. 25/2016)
• 10. The licencee may appoint one or more employees as authorized signatories. The specimen signature of such authorised signatories and the specimen impression of the stamp of the licencee, contact details including E-mail Id of the warehouse keeper and authorised signatories should be kept updated with the bond officers at all times. (Circular No. 25/2016).
• 11. The warehouse shall have facilities such as computer, photocopier, scanner and printer in the warehouse. (Circular No. 25/2016)
• 12. Security for transit : (Circular No. 21/2016) The importer shall submit a comprehensive Transit Risk insurance policy = cover the transit goods equal in sum to the duty involved on the goods, in favour of the President of India for the movement of goods from :

  • i. The Customs station of import to the warehouse; or ii. One warehouse to another warehouse; or

  • lii. A warehouse to the customs station for export. In certain cases, such as Liquid bulk cargo being transported through

  • pipelines, the requirement of transit insurance may be waived.

13. Security for storage : (for sensitive goods) :

• i. Ist year - not required. ii. Extension beyond one year - Bank Guarantee for an amount of 50% of the sum of duty + interest

• iii. Extension beyond 2 years - Bank Guarantee for an amount equivalent to the duty involved + interest

14. Security for storage : (for sensitive goods) :

• i. 1st year — not required. ii. Extension beyond one year - Bank Guarantee for an amount of 25% of the sum of duty + interest

• iii. Extension exceeding two years - Bank Guarantee for an amount of 50% of the sum of duty + interest

• iv. Extension exceeding three years - Bank Guarantee for an amount equivalent to the duty involved + interest.

• 15. The importer is required to execute a triple duty bond at the customs station of import with respect to the goods to be cleared for deposit in a warehouse. The format of the bond to be so executed under sub-section (1) or subsection (2) of section 59 of CA, 1962 given in Circular No. 18/2016.

16. A Public Bonded warehouse is strictly for warehousing of goods belonging to third parties. An applicant seeking a licence for a Public Bonded Warehouse shall declare that goods imported by him shall not be stored in the Public Bonded Warehouse for which the application has been made.

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• } 17. an jot eae shall be eligible to obtain separate licences for a Private a ed Warehouse for storage of the goods imported by him, and a Public onded Warehouse for storage of the goods of third parties. There shall be

• no bar in a single site being securely partitioned and distinctly marked on a ground plan for being licenced separately as Public & Private Bonded Warehouses. (circular no. 26/2016)

  • Notes : ,

    • All applicants who wish to apply for a new public warehouse licence under section 57 are requested to submit their applications in the form attached to circular no. 26/2016. The said form is available on the website.

  • The licence granted under the regulations shall remain valid till its surrender /cancellation. Henceforth, there shall be no requirement for renewal of warehousing licence an annual basis.

  • • In case of licencees issued earlier to the notification of licencing Regulations on 14.05.2016, the requirement of annual renewal is

  • ; dispensed. All warehouses appointed under the erstwhile Section S7 or licence under erstwhile Section 58 shall be deemed to remain valid till their surrender/cancellation, once the conditions under the new regulations have been complied.

    • A licencee shall be required to renew the Insurance policy annually and also continue to comply with the solvency condition (as applicable), hence, the same shall be required to be submitted annually.

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