Customs administration to be modernised

EXIM MATTERS

With the accession to the revised Kyoto Convention of simplification and harmonization of customs procedures of the World Customs Organisation (WCO) that is to come into force from February 3 next year, India is poised to modernise its customs administration and bring the procedures on par with international best practices.

The key elements of the strategy include the maximum use of information technology, a partnership between customs and the trade, the application of risk management techniques and the coordination of interventions with other agencies.

The Central Board of Excise and Customs (CBEC) recognises that with the exponential growth in trade volumes, the traditional approach of scrutinising every document and every consignment will simply not work, as it wouldneither be desirable nor possible to increase the resources with the increasing workload.

Also, there is a need to reduce the dwell-time of cargo at the ports and reduce transaction costs to enhance the competitiveness of Indian businesses, by expediting release of cargo where compliance is high.

The CBEC has, therefore, introduced an Accredited Clients Programme, wherein, importers who meet the criteria set out will get import clearance on the basis of their declarations at all the ports where Electronic Data Interchange (EDI) and Risk Management System (RMS) are operational.

Separate earmarked facility/counters for providing faster clearances and separate storage space at the ports will be earmarked for those who register as Accredited Clients.

The minimum criteria laid down to register as Accredited clients are not too stiff - import clearances worth Rs 25 crores or Rs 1 crore excise or customs duty payment and 25 bills of entry in the previous year.

However, the other conditions- no show cause notices under customs, excise or services tax or any other allied laws in the previous years, no duty demands pending on account of non-fulfilment of export obligation etc.- are so unrealistic that few importers will get registered.

The CBEC is also introducing RMS, wherein computer system will determine which bills of entry may be taken up for examination or appraisement. The other consignments will be cleared on the basis of importers' declaration.

A compliance verification programme will replace the present system of concurrent audit. In case , short levies are noticed, consultative letters, instead of show cause notices will be issued to importers giving them an opportunity to comply and pay the duty difference if they agree with the department's point of view.

The CBEC has also introduced simplified bond module covering both custodianship and transshipment, single mother bond for several purposes, waiver of bank guarantees for transshipment of import and export cargo, simpler procedures for movement of less than container load (LCL) cargo from one Container Freight Station (CFS) to another and for movement of containerised cargo from gateway ports to hinterland ports, conversion of foreign going vessels to coastal vessels, customs duty collection of ship stores consumed during coastal run etc.

The steps taken by CBEC are commendable and hopefully, there will be more such initiatives in the coming weeks, particularly for those using export promotion schemes.

Also, the CBEC must review the "nexus" issue under advance license scheme, allow conversion of shipping bills as a matter of course and update its manual of supplementary instructions every year.

tncr@sify.com