Customs Clearance: Documents Required in India

Last Updated at: December 14, 2019
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Customs Clearance: Documents Required in India

The import customs clearance in India is a long and arduous process. While most import customs clearance documents are a common requirement some of them depend on the nature of imported commodities or goods. This article covers the most commonly required documents for the customs clearance process in India. Thereby empowering you, the import business owner, with the basic knowledge required to know your obligations and rights.

Commercial Invoice

It is the most important document when it comes to a business transaction. A commercial invoice is used to appraise the value of the commodity. The customs officer compares the value of the commodity as stated in the commercial invoice against its actual market value. This method prevents fraudulent activities by importers, such as in under and invoicing.

Bill of Entry

It is a legal document that is filed within 30 days of the arrival of goods. It is either the Custom House Agent (CHP) or the Importer who files it. Managed by the Reserve Bank and the Customs department, it is one of the indicators of ‘total outward remittance of the country’ from where the good or commodity is imported. Inspection and assessment of goods are only carried out after the Bill of Entry is presented along with other customs clearance documents. The ‘Pass Out Order’ which is necessary for releasing the goods from customs is issued to the importer or the CHP, under the Bill of Entry.

Import License

An import license is required for specific goods as per the guidelines stated by the government. The movement of these goods into the country is regulated by the government, which is why an import license is required for customs clearance. To give you an idea, these goods may vary from precious stones & metals, petroleum-based products, pharmaceuticals, and chemicals, to several others.

Bill of Lading or Airway Bill

It is proof of receipt issued by the carrier of goods (by ship or air) which comprises the terms of delivery and details about the goods they are carrying. It needs to be submitted at the time of customs clearance by the importer.

Purchase Order/Letter of Credit

A Purchase Order is issued by the importer to the seller. It states the terms of sale, which is essential for the customs officer to assess the value of goods. If a Letter of Credit is issued, the importer submits a copy of the same at the time of customs clearance. 

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Insurance Certificate

This certificate helps the customs offer to asses the value of goods at the time of customs clearance. It is compared against the delivery terms issued by the importer to verify if the sale price includes the insurance cost as well.

Industrial License

It is applicable for only specific types of good, as per government guidelines. An industrial license can help the importer in availing several import benefits, by presenting a copy of the same during the customs clearance process.

GATT and DGFT Declaration

The General Agreement on Tariff and Trade declaration and Director General of Foreign Trade declaration are to be filed every importer, along with other necessary documents required for customs clearance. These declarations are to be filed as per their respective terms, mandated by the Government of India.

Technical Write-Ups

This requirement falls under the category of ‘specific goods’. As per the requirement, a technical write-up will help the customs officer in checking the market value of the product and will enable its total value assessment. 

Registration cum Membership Certificate (RCMC)

Not a mandatory requirement, but used for gaining exemption on import duties. These exemptions are availed on goods issued under the RCMC. This certificate needs to be presented along with the other import documents to the customs official.

Duty Benefits

An importer can avail duty benefits, under schemes such as Export Credit Guarantee Corporation of India (ECGC), Duty Entitlement Pass Book (DEPB) and Duty Exemption Entitlement Certificate (DEEC), by presenting copies of these licenses/certificates at the time clearance.

Central Excise Duties 

They depend on the goods that are imported into the country. If eligible for benefits then a copy of the central excise duty paid has to be presented for customs clearance.

Test Reports

The appraisement value of certain goods is determined as per quality checks. With respect to certain goods, customs officials may share samples of these goods with government-approved labs to measure quality. In this case, goods are cleared upon receipt of the test report.

Apart from the above, government guidelines mandate the requirement of specific documents.

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Customs Clearance: Documents Required in India

836

The import customs clearance in India is a long and arduous process. While most import customs clearance documents are a common requirement some of them depend on the nature of imported commodities or goods. This article covers the most commonly required documents for the customs clearance process in India. Thereby empowering you, the import business owner, with the basic knowledge required to know your obligations and rights.

Commercial Invoice

It is the most important document when it comes to a business transaction. A commercial invoice is used to appraise the value of the commodity. The customs officer compares the value of the commodity as stated in the commercial invoice against its actual market value. This method prevents fraudulent activities by importers, such as in under and invoicing.

Bill of Entry

It is a legal document that is filed within 30 days of the arrival of goods. It is either the Custom House Agent (CHP) or the Importer who files it. Managed by the Reserve Bank and the Customs department, it is one of the indicators of ‘total outward remittance of the country’ from where the good or commodity is imported. Inspection and assessment of goods are only carried out after the Bill of Entry is presented along with other customs clearance documents. The ‘Pass Out Order’ which is necessary for releasing the goods from customs is issued to the importer or the CHP, under the Bill of Entry.

Import License

An import license is required for specific goods as per the guidelines stated by the government. The movement of these goods into the country is regulated by the government, which is why an import license is required for customs clearance. To give you an idea, these goods may vary from precious stones & metals, petroleum-based products, pharmaceuticals, and chemicals, to several others.

Bill of Lading or Airway Bill

It is proof of receipt issued by the carrier of goods (by ship or air) which comprises the terms of delivery and details about the goods they are carrying. It needs to be submitted at the time of customs clearance by the importer.

Purchase Order/Letter of Credit

A Purchase Order is issued by the importer to the seller. It states the terms of sale, which is essential for the customs officer to assess the value of goods. If a Letter of Credit is issued, the importer submits a copy of the same at the time of customs clearance. 

Get a FREE legal advice

Insurance Certificate

This certificate helps the customs offer to asses the value of goods at the time of customs clearance. It is compared against the delivery terms issued by the importer to verify if the sale price includes the insurance cost as well.

Industrial License

It is applicable for only specific types of good, as per government guidelines. An industrial license can help the importer in availing several import benefits, by presenting a copy of the same during the customs clearance process.

GATT and DGFT Declaration

The General Agreement on Tariff and Trade declaration and Director General of Foreign Trade declaration are to be filed every importer, along with other necessary documents required for customs clearance. These declarations are to be filed as per their respective terms, mandated by the Government of India.

Technical Write-Ups

This requirement falls under the category of ‘specific goods’. As per the requirement, a technical write-up will help the customs officer in checking the market value of the product and will enable its total value assessment. 

Registration cum Membership Certificate (RCMC)

Not a mandatory requirement, but used for gaining exemption on import duties. These exemptions are availed on goods issued under the RCMC. This certificate needs to be presented along with the other import documents to the customs official.

Duty Benefits

An importer can avail duty benefits, under schemes such as Export Credit Guarantee Corporation of India (ECGC), Duty Entitlement Pass Book (DEPB) and Duty Exemption Entitlement Certificate (DEEC), by presenting copies of these licenses/certificates at the time clearance.

Central Excise Duties 

They depend on the goods that are imported into the country. If eligible for benefits then a copy of the central excise duty paid has to be presented for customs clearance.

Test Reports

The appraisement value of certain goods is determined as per quality checks. With respect to certain goods, customs officials may share samples of these goods with government-approved labs to measure quality. In this case, goods are cleared upon receipt of the test report.

Apart from the above, government guidelines mandate the requirement of specific documents.

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