Duty List for Customs Custodian

[Customs Public Notice No. 01 dated 27th January 2011]

The following Public Notice was issued by the Commissioner of Customs Air Cargo Complex, Mumbai on 27th January 2011.

Sub: Handling of Cargo in Customs Areas Regulations 2009.

Attention of custodians, customs cargo service providers, members of the trade and industry is invited to the Handling of Cargo in Customs Areas Regulations, 2009 notified by Notification No.26/2009-Customs (NT) dated 17.03.2009. CBEC Circular No.13/2009-Customs dated 23.3.2009 was issued in that regard and ACC, Mumbai had consequently issued Public Notice No. 15/2009 dated 13.07.09.

1A. Handling of Cargo in Customs Areas Regulations, 2009 provide comprehensive guidelines for receipt, storage, delivery or otherwise handling of goods in the Customs area. These regulations also prescribe the responsibilities of persons engaged in the aforesaid activities. The Regulations have been amended by Notification No.96/2010-Customs (NT) dated 12.11.2010. Moreover, Government has accepted certain recommendations of the Parliamentary Committee on Subordinate Legislation. The CBEC Circular No.4/2011-Customs dated 10.1.2011 have been issued in this regard. Important aspects are highlighted herein below.

2. The amended Regulation 5 now, inter alia, provides the obligation of a Customs Cargo Service Provider (CCSP) approved as a Custodian of imported and export goods in respect of safety and security of the premises for loading, unloading, receipt and disposal of imported and export goods in the following manner:

“5. Conditions to be fulfilled by Customs Cargo Service provider – The Customs Cargo Service provider for custody of imported goods or export goods and for handling of such goods in a customs area shall fulfill the following conditions, namely:-

(1) Provide the following to the satisfaction of the Commissioner of Customs, namely:

(i) Infrastructure, equipment and adequate manpower for loading, unloading, stacking, handling, stuffing and de-stuffing of containers, storage, dispatch and delivery of containers and cargo etc., including:-

(a) standard pavement for heavy duty equipment for use in the operational and stacking area;

(b) free of cost or rent fully furnished office accommodation for Customs, Customs Electronic Data Interchange (EDI) Service Centre, with required amenities and facilities and residential accommodation and transportation facilities for customs staff;

(d) storage facility, separately for imported, export and transshipment goods;

(e) gate complex with separate entry and exit;

(f) adequate parking space for vehicles;

(g) boundary wall;

(h) internal service roads;

(i) electronic weigh-bridge and other weighing and measuring devices;

(j) computerized system for location and accountal of goods, and processing of documents;

(k) adequate air-conditioned space and power back up, hardware, networking and other equipment for secure connectivity with the Customs Automated system; and for exchange of information between Customs Community partners;

(l) facilities for auction, including by e-auction, for disposal of uncleared, unclaimed or abandoned cargo;

(m) facilities for installation of scanning equipment;

(n) security and access control to prohibit unauthorized access into the premises, and

(o) such other facilities as the Commissioner of Customs may specify having regard to the custody and handling of imported or export goods in a customs area;

(ii) safe, secure and spacious premises for loading, unloading, handling and storing of the cargo for the projected capacity and for the examination and other operations as may be required in compliance with any law for the time being in force;

(iii) insurance for an amount equal to the average value of goods likely to be stored in the customs area based on the projected capacity, and for an amount as the Commissioner of Customs may specify having regard to the goods which have already been insured by the importers or exporters.

(2) Undertake to bear the cost of the Customs officers posted, at such customs area, on cost recovery basis, by the Commissioner and shall make payments at such rates and in the manner prescribed, unless specifically exempted by an order of the Government of India in the Ministry of Finance;

(3) Execute a bond equal to the average amount of duty involved on the imported goods and ten per cent of value of export goods likely to be stored in the customs area during a period of thirty days and furnish a bank guarantee or cash deposit equivalent to ten per cent of such duty:

Provided that the condition of furnishing of Bank guarantee or cash deposit shall not be applicable to ports notified under the Major Ports Act, 1962 (38 of 1963) or to the Central Government or State Governments or their undertakings;

(4) Execute a separate bond for an amount equal to ten percent of value of export goods with a bank guarantee for an amount equal to ten percent of the value of the bond, towards the export goods transported from the customs area to any other customs area for export or transshipment, as the case may be;

(5) Undertake to comply with the provisions and abide by all the provisions of the Act and the rules, regulations, notifications and orders issued there under

(6) Undertake to indemnify the Commissioner of Customs from any liability arising on account of damages caused or loss suffered on imported or export goods, due to accident, damage, deterioration, destruction or any other unnatural cause during their receipt, storage, delivery, dispatch or otherwise handling.”

3. Thus, it should be noted that the Regulation 5, amended w.e.f. 12.11.2010, specifies that, -

(1) In addition to other obligations, all CCSPs for custody of imported or export goods and for handling of such goods in the Customs area shall provide free of cost or rent, fully furnished office accommodation, EDI service center along with basic amenities and facilities.

(2) It is made mandatory to all such CCSP to provide residential accommodation and transport facilities to the Customs staff.

4. In this regard, it is clarified that –

(1) No exemption is available to existing Custodians / CCSP in so far as provision of facilities and fulfillment of the prescribed conditions in Regulation 5 and 6, as applicable, within the specified limit are concerned.

(2) Custodians under the Major Port Trusts Act, 1963 and Airports Authority of India Act, 1994 shall not be required to make an application under Regulation 4 or 9 for approval or renewal under these regulations, but they would be required to necessarily discharge the responsibilities cast upon them in terms of Regulations 5 and 6 without any exception.

6. It is to be further noted that the amended Regulation 6(3), mandatorily requires the publication of Schedule of Charges associated with various services in relation to imported or export goods in the Customs area and its display at prominent places including web page or website of the CCSP. The compliance has to be reported by all CCSPs and monitored.

7. As is evident, the amended Regulations also provide that CCSPs will invariably undertake, by furnishing an indemnity Bond, to indemnify the Commissioner of Customs from any liability arising on account of damages caused or loss suffered on imported or export goods, due to accident, damage, deterioration, destruction or any other unnatural cause during their receipt, storage, delivery, dispatch or otherwise handling.

8. In addition, attention is drawn to the fact that Regulation 5 provides, inter alia, that the CCSP, for custody of imported goods or export goods and for handling of such goods, in a customs area, shall fulfill the conditions, of providing to satisfaction of Commissioner, security and access control to prohibit unauthorized access to the premises [5(1)(i)(n)]; safe, secure and spacious premises for loading, unloading, handling and storing of the cargo for the projected capacity and for the examination and other operations as may be required in compliance with any law for the time being in force [5(1)(ii)].

8A. Consequent to Government accepting the suggestions of the Parliamentary Committee on Subordinate Legislation that conditions under Regulation 5 concerning safety and security of premises should not be subject to exemption by any authority, the ‘power to relax’ the fulfillment of conditions of Regulation 5 does not extend to the requirements of safety and security of premises. Thus, there can be no relaxation or exemption from requirements on safety and security of premises (in Regulation 5) to the Custodians or CCSPs in terms of Regulation 7.

8B. Further, keeping in view the paramount importance of overall safety and security of imported/export goods, CBEC has prescribed guidelines so as to ensure that all concerned persons ensure that suitable arrangements are put in place for safety and security of premises relating to imported or export goods. These will be complied with strictly when CCSPs are appointed and their compliance reviewed and monitored thereafter, including for CCSP who have been appointed earlier in terms of proviso to Regulation 10(2). The Guidelines on Safety and Security of Premises where Imported or Export Goods are Loaded, Unloaded, Handled or Stored are –

(1) The imported goods or export goods which are hazardous in nature, shall be stored at the approved premises of the CCSP in isolated place duly separated from other general cargo, depending upon classification of its hazardous nature such as Explosives (as defined under Rule 3 of Explosives Rules, 1983), Gases (Inflammable / Flammable Gases, Toxic/ non Toxic gases etc.), Flammable Liquids, Flammable Solids (Raw and wet Cotton, spontaneous combustible substances, substance emitting flammable gases in contact with water etc.), Oxidizing Substance & Organic Peroxide (Sodium peroxide, Barium Bromate, Peroxy acetic acid etc.), Poisonous & Infectious Substances (Tear Gas, Biological substances, Formic Acid, Arsenic Acid etc.), Radio Active Materials, Corrosives (Acetic Acid, Sulphuric Acid, Caustic soda etc.) or any hazardous chemicals defined under Chemical Accidents (Emergency Planning, Preparedness, and Response) Rules, 1996.

(2) Safety plans, procedures, instructions for Safe handling and storage of hazardous goods including the procedure for reporting accidents to proper officer of Customs and appropriate State Authorities shall be available.

(3) Safety sign boards, signals should be displayed conspicuously; safety instructions and procedures shall be made available at the premises and the staff handling the goods should be familiar with all the pictorial indications or stickers used in international trade such as International Maritime Dangerous Goods code, other domestic legislations to identify hazardous goods.

(4) The premises should be equipped with adequate fire fighting apparatus, such as Fire extinguishers, Fire Hydrants, Fire Pumps, Fire hoses, Fireman outfits, Co2 fix systems. Further, in order to protect the premises against fire hazard, it would be necessary that fire preventive equipments such as automatic Fire detection and alarm system, Fire control plan, Nozzles, Smoke detectors, Temperature detectors, automatic sprinkler systems, sand boxes, emergency lighting system, water supply outlet, fire exit etc are also provided. General facilities such as ventilation, electricity system, emergency exit etc. shall also be provided. In addition to these, the premises and surrounding area shall be well illuminated, duly protected with spark arresters. ‘No smoking’ signals should be properly displayed in the premises and the provisions banning smoking in public places as per Section 4 of Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Act, 2003, shall be enforced.

(5) The space allocated for storage of hazardous cargo within the premises should be of proper construction including appropriate heat or fire resistant wall, RCC roofing, flooring. Such area shall be situated at a minimum distance of 200 meters away from main office, administrative, customs office building so that the storage of hazardous cargo is in such a manner that it does not endanger the people working in the premises. Further, the open space, provided for movement, total covered area for storage of containers shall be in such manner that they do not hinder movement of persons, evacuation of goods in case of emergency. The premises used by CCSP for storage of hazardous cargo shall also fulfill the standards or norms prescribed, in National Building Code of India (Part 4 - Fire and Life safety specify the requirements for fire prevention, life safety in relation to fire and fire protection of buildings necessary to minimize danger to life and property from fire) or by the concerned State/ Central Governments for fire safety.

(6) The material handling equipments including cranes, lifts, hoists, reach stackers, tractors, trucks and other vehicles for movement or transport of goods and other machines used in the premises for handling of cargo shall be in conformity with the safety standards prescribed for such equipments.

(7) The Custodian shall provide appropriate Contingency plan to handle emergency situation when there is an immediate danger to personnel, cargo or other infrastructure in the premises; Further the custodian shall provide acquaintance or training of their staff for proper implementation and to comply with these contingency plans, maintenance & readiness of all the equipments.

(8) The Custodian shall provide Medical First Aid Kits within the premises; he shall provide appropriate emergency medical services in case any person comes into contact with hazardous/ dangerous goods.

(9) The security and safety of the premises shall be assigned to specified persons working therein so that necessary services in case of emergency such as fire fighting, fire brigade, fire tenders shall be obtained in time to prevent, control and extinguish fire.

(10) Handling of hazardous cargo within the premises, transportation of hazardous cargo between the premises and port terminals or other authorized places is secured through authorized vehicles with proper safety indications.

(11) The provisions of the Hazardous Waste (Management, Handling, Trans Boundary) Rules, 2009 and the Manufacture, Storage and import of Hazardous Chemical Rules, 1989 and other relevant rules and regulations prescribed by the Government shall be adhered to in respect of storage and handling of such goods.

(12) The Custodian shall provide appropriate procedure for receipt, handling, delivery of hazardous cargo in such a manner that the same does not hinder the movement of general cargo or endanger the safety and security of the premises.

(13) The guidelines have been provided in order to ensure that the CCSP receiving, storing, dispatching or otherwise handling of imported goods and export goods of hazardous nature at the approved premises is handled in safe and secure manner. The CCSP who intend to store hazardous cargo or hazardous cargo along with other general cargo at their premises, may apply to the jurisdictional Commissioner of Customs with the requisite particulars so that the same may be verified for compliance in terms of Regulation 10 (2).

9. The Public Notice No. 15/2009 dated 13.7.2009 of ACC, Mumbai is superseded by this Public Notice. Non-Compliance w.r.t. any provisions of the Handling of Cargo in Customs Areas Regulations, 2009 (as amended), rules, notification and provisions of the Customs Act shall invite appropriate liability under the Customs Act, 1962.

10. Any genuine difficulty in implementation should be brought to notice immediately for conveying to the CBEC.

F.No.S/3-Prev-Admn-43/2009 ACC

Enclosure with Public Notice

HCCAR, 2009 (amended upto 12.11.2010)

[In case of typographical errors, the notification text shall prevail]

1. Short title and commencement. –

(1) These regulations may be called the Handling of Cargo in Customs Areas Regulations, 2009.

(2) They shall come into force on the date of their publication in the Official Gazette.

2. Definitions. –

(1) In these regulations, unless the context otherwise requires, -

a. “Act” means the Customs Act, 1962 (52 of 1962);

b. “Customs Cargo Services provider” means any person responsible for receipt, storage, delivery, dispatch or otherwise handling of imported goods and export goods and includes a custodian as referred to in section 45 of the Act and persons as referred to in sub-section (2) of section 141 of the said Act;

c. “specified“ means specified by a notification or an order issued under the provisions of the Act;

(2) the words and expressions used herein and not defined but defined in the Act shall have the same meanings respectively assigned to them in the Act.

3. Application. – These regulations shall be applicable to the handling of imported and export goods in customs areas as specified under section 8 of the Act.

4. Retrospective Application. – Any action taken or anything done in respect of appointment of Customs Cargo Service providers, immediately preceding the coming into force of these regulations, shall be deemed to have been done under the corresponding provisions of these regulations. Customs Cargo Service providers already approved on or before the date of coming into force of these regulations shall comply with the conditions of these regulations within a period of three months or such period not exceeding a period of one year as the Commissioner of Customs may allow from the date of coming into force of these Regulations.

5. Conditions to be fulfilled by Customs Cargo Service provider – The Customs Cargo Service provider for custody of imported goods or export goods and for handling of such goods in a customs area shall fulfill the following conditions, namely:-

(1) Provide the following to the satisfaction of the Commissioner of Customs, namely:

a) standard pavement for heavy duty equipment for use in the operational and stacking area;

b) free of cost or rent fully furnished office accommodation for Customs, Customs Electronic Data Interchange (EDI) Service Centre, with required amenities and facilities and residential accommodation and transportation facilities for customs staff;

c) premises for user agencies with basic amenities and facilities;

d) storage facility, separately for imported, export and transshipment goods;

e) gate complex with separate entry and exit;

f) adequate parking space for vehicles;

g) boundary wall;

h) internal service roads;

i) electronic weigh-bridge and other weighing and measuring devices;

j) computerized system for location and accountal of goods, and processing of documents;

k) adequate air-conditioned space and power back up, hardware, networking and other equipment for secure connectivity with the Customs Automated system; and for exchange of information between Customs Community partners;

l) facilities for auction, including by e-auction, for disposal of uncleared, unclaimed or abandoned cargo;

m) facilities for installation of scanning equipment;

n) security and access control to prohibit unauthorized access into the premises, and

o) such other facilities as the Commissioner of Customs may specify having regard to the custody and handling of imported or export goods in a customs area;

(5) Undertake to comply with the provisions and abide by all the provisions of the Act and the rules, regulations, notifications and orders issued there under

6. Responsibilities of Customs Cargo Service provider:

(1) The Customs Cargo Service provider shall –

(a) keep a record of imported goods, goods brought for export or transshipment, as the case may be, and produce the same to the proper officer as and when required;

(b) keep a record of each activity or action taken in relation to the movement or handling of imported or export goods and goods brought for trans shipment;

(c) display or make available in any other manner, information of process or movement or handling of imported or export goods and goods brought for trans shipment;

(d) demarcate separate areas for unloading of imported goods for their storage with respect to the category of importers, nature of goods, place of destination, mode of transportation or any other criterion as the Commissioner of Customs may specify having regard to the custody and handling of imported goods in a customs area;

(e) demarcate separate areas for loading of export goods for their storage with respect to categories of exporters, nature of goods, examined and sealed containers or other criterion as the Commissioner of Customs may specify having regard to the custody and handling of export goods in a customs area;

(f) not permit goods to be removed from the customs area, or otherwise dealt with, except under and in accordance with the permission in writing of the proper officer;

(g) not permit any export cargo to enter the customs area without a shipping bill or a bill of export having been filed with the proper officer;

(h) not permit any import cargo to enter the customs area or be unloaded therein without the import report or the import manifest having been filed with the proper officer;

(i) be responsible for the safety and security of imported and export goods under its custody;

(j) be liable to pay duty on goods pilfered after entry thereof in the customs area;

(k) be responsible for the secure transit of the goods from the said customs area to any other customs area at the same or any other customs station in accordance with the permission granted by the proper officer;

(l) subject to any other law for the time being in force, shall not charge any rent or demurrage on the goods seized or detained or confiscated by the proper officer;

(m) dispose off in the manner specified and within a time limit of ninety days, the imported or export goods lying unclaimed, un-cleared or abandoned:

Provided that the period of ninety days may be extended by the Commissioner of Customs by such further period as may be allowed, on sufficient cause being shown for delay in the disposal;

(n) not make any alteration in the entry or exit points or boundary wall without the permission of the Commissioner of Customs;

(o) shall bear the cost of the customs officers posted by the Commissioner of Customs on cost recovery basis and shall make payments at such rates and in the manner specified by the Government of India in the Ministry of Finance unless specifically exempted by an order of the said Ministry;

(p) shall observe the Central Government holidays as followed by the jurisdictional Customs formations and in case of any variation in the working days, intimate the same to Commissioner of Customs and the trade, at least seven days in advance, and

(q) abide by all the provisions of the Act and the rules, regulations, notifications and orders issued there under.

(2) The Customs Cargo Service provider approved for custody of imported or export goods and for handling of such goods shall not lease, gift, sell or sublet or in any other manner transfer any of the premises in a customs area; or sub contract or outsource functions permitted or required to be carried out by him in terms of these regulations to any other person, without the written permission of the Commissioner of Customs.

(3) The Customs Cargo Service provider shall publish and display at prominent places including website or webpage of the Customs Cargo Service provider the schedule of charges for the various services provided by him in relation to the imported goods or export goods in the customs area.

7. Power to relax and regulate:

(1) If the Commissioner of Customs is satisfied that in relation to the custody and handling of imported or export goods in a customs area, the Customs Cargo Service provider, for reasons beyond his control, is unable to comply with any of the conditions of regulation 5, he may for reasons to be recorded in writing, exempt such Customs Cargo Service provider from any of the conditions of regulation 5.

(2) The Commissioner of Customs may regulate the entry of goods in a customs area for efficient handling of such goods.

8. Commencement of operations: The Customs Cargo Service provider approved for custody of imported or export goods and for handling of such goods shall not commence any operations in a customs area for the first time unless the Commissioner of Customs is satisfied that all the requirements of the Act have been fulfilled and grants permission to commence the operations by an order in writing.

9. Application for approval of Customs Cargo Service provider:

(1) An application to act as a Customs Cargo Service provider for custody of imported or export goods and for handling of such goods in a customs area shall be made in the form of a letter to the jurisdictional Commissioner of Customs containing details as prescribed in ‘Form A’.

(2) The Commissioner of Customs shall dispose of the application within forty five days of the receipt of the application.

10. Approval of appointment of a Customs Cargo Service provider and review thereof:

(1) Where the Commissioner of Customs is satisfied that the applicant has fulfilled the conditions prescribed in regulation 5, he may approve such an applicant as a Customs Cargo Service provider, for a period of two years from the date of issue of such approval.

Provided that a Customs Cargo Service provider already approved on or before the date of coming into force of these regulations, shall be deemed to be approved as a Customs Cargo Service provider under these regulations for a period of five years from the date of compliance with the conditions of these regulations as stipulated in regulation 4.

(2) The Commissioner of Customs shall review the approval granted under sub regulation (1) before the expiry of the initial period of approval of two years or five years, as the case may be, and may extend such approval to a further period of five years at a time.

Provided that the Commissioner of Customs, for reasons to be recorded in writing, may order for review of the approval granted to any Customs Cargo Service provider before the completion of the period of approval.

11. Suspension or revocation of approval for appointment of a Customs Cargo Service provider:

(1) The Commissioner of Customs may, subject to the provisions of these regulations, suspend or revoke the approval granted to the Customs Cargo Service provider subject to the observance of procedure prescribed under regulation 12 and also order for forfeiture of security, if any, for failure to comply with any of the provisions of the Act and the rules, regulations, notifications and orders made there under;

(2) Notwithstanding anything contained in sub-regulation (1), the Commissioner of Customs may, in appropriate cases where immediate action is necessary, suspend the approval granted to a Customs Cargo Service provider where an enquiry against such Customs Cargo Service provider is pending or contemplated.

12. Procedure for suspension or revocation of approval and imposition of penalty:-

(1) The Commissioner of Customs shall issue a notice in writing to the Customs Cargo Service provider stating the grounds on which it is proposed to suspend or revoke the approval and requiring the said Customs Cargo Service provider to submit within such time as may be specified in the notice not being less than thirty days, to the Assistant Commissioner or Deputy Commissioner of Customs nominated by him, a written statement of defense and also to specify in the said statement whether the Customs Cargo Service provider desires to be heard in person by the said Assistant Commissioner or Deputy Commissioner of Customs.

(2) On receipt of the written statement from the Customs Cargo Service provider, or where no such statement has been received within the time-limit specified in the notice referred to in sub-regulation (1), the Assistant Commissioner or Deputy Commissioner of Customs may inquire into such of the grounds as are not admitted by the Customs Cargo Service provider.

(3) The Assistant Commissioner or Deputy Commissioner of Customs shall, in the course of inquiry, consider such documentary evidence and take such oral evidence as may be relevant or material to the inquiry in regard to the grounds forming the basis of the proceedings and he may also put any question to any person tendering evidence, for or against the Customs Cargo Service provider, for the purpose of ascertaining the correct position.

(4) The Customs Cargo Service provider shall be entitled to cross-examine the persons examined in support of the grounds forming the basis of the proceedings and where the Assistant Commissioner of Customs or Deputy Commissioner of Customs declines to examine any person on the grounds that his evidence is not relevant or material, he shall record his reasons in writing for so doing.

(5) At the conclusion of the aforesaid inquiry, the Assistant Commissioner of Customs or Deputy Commissioner of Customs shall prepare a report of the inquiry recording his findings.

(6) The Commissioner of Customs shall furnish to the Customs Cargo Service provider a copy of the report of the Assistant Commissioner or Deputy Commissioner of Customs and shall require the Customs Cargo Service provider to submit within the specified period not being less than thirty days any representation that he may wish to make against the findings of the Assistant Commissioner of Customs or Deputy Commissioner of Customs.

(7) The Commissioner shall, after considering the report of the inquiry, and the representation thereon, if any, made by the Customs Cargo Service provider, pass such orders as he deems fit.

(8) If any Customs Cargo Service provider contravenes any of the provisions of these regulations, or abets such contravention or who fails to comply with any provision of the regulation with which it was his duty to comply, then, he shall be liable to a penalty which may extend to fifty thousand rupees.

(9) Any Customs Cargo Service provider aggrieved by any decision or order passed under this regulation, may appeal under section 129A of the Act to the Customs Central Excise and Service Tax Appellate Tribunal established under sub-section 1 of section 129 of the Act.

13. Renewal of approval for appointment of Customs Cargo Service provider: The Commissioner of Customs may on application made by the Customs Cargo Service provider before the expiry of the validity of the appointment under regulation 10, renew the approval for a further period of five years from the date of expiration of the original approval granted under regulation 10 or of the last renewal of such approval, as the case may be, if the performance of the approved Customs Cargo Service provider is found to be satisfactory with reference to his obligations under any of the provisions of the Act and the rules, regulations, notifications and orders made there under.

Form – A
[see regulation 9 (1)]

(Please refer the Notification 26/2009 Customs (NT) dated 17.3.2009)