Essential customs clearance for transported goods involves authorised brokers. This process manages info on imports, exports, and involved parties. Read along to find out more about the documents required for customs clearance in India.

Customs clearance is an integral process, ensuring the seamless flow of goods across international borders. Adhering to regulations and formalities stipulated by a country’s customs authorities is imperative. In India, the customs clearance procedures, overseen by the Central Board of Indirect Taxes and Customs (CBIC), serve as a linchpin in fostering trade and upholding national border security.

The CBIC assumes a pivotal role in regulating customs operations, formulating policies, enforcing regulations, and collecting various customs duties. These duties encompass basic customs duties, additional duties, and goods and services tax (GST). A comprehensive understanding of these duties is paramount for importers and exporters, enabling accurate calculation of transaction costs and ensuring compliance with the intricacies of the customs landscape in India.

Latest Development by CBIC 

The CBIC has introduced ICEDASH, a valuable tool for importers and exporters to assess clearance times at Customs Ports. Acting as an Ease of Doing Business monitoring dashboard, ICEDASH displays daily Customs clearance durations at major Customs stations. The primary objective is to enhance the monitoring and efficiency of Customs clearance processes for imported goods.

ICEDASH serves as a comprehensive platform enabling businesses to compare clearance times across various Customs ports, including Seaports, ICDs, Integrated Check Posts (ICPs), and Air Cargo Complexes (ACCs). By providing real-time information, it facilitates effective logistics planning for importers and exporters, contributing to a streamlined and efficient trade process.

Documents Required In India for Customs Clearance

Governments of several nations may have bilateral agreements on imports and exports. Exemptions from the documentation requirements for export and import clearance may apply to imports and exports from these nations. However, there are special documents based on commodities, common documents, and legal documents that must be submitted to fulfill import customs operations. Here is a total overview of all documents. Note that we have given separate document requirements for export and import in India.

• Proforma Invoice:

1. Explains product details.
2. Agreed terms between exporter and importer.
3. Essential for export customs clearance.

• Customs Packing List:

1. Detailed list for shipment.
2. Cross-verified with ProForma invoice.
3. Mandatory for customs clearance.

• Country of Origin Certificate (COO):

1. Declares goods’ origin.
2. Issued by exporting company.
3. Assists in determining product source.

• Customs Invoice:

1. Crucial for international shipments.
2. Verified by customs officials.
3. Includes order details and payment terms.

• Shipping Bill:

1. A permanent record of export.
2. Submitted electronically (ICEGATE).
3. Requires various supporting documents.

• Bill of Lading:

1. Evidence of shipping contract.
2. Contains product details.
3. Signed by exporter, carrier, and receiver.

• Bill of Sight:

1. Declares unknown shipped goods.
2. Enables inspection before payment.
3. Includes exporter’s letter for clearance.

• Letter of Credit:

1. Bank’s undertaking for payment.
2. Ensures payment to the exporter.

• Bill of Exchange:

1. Payment substitute, like an IOU.
2. The importer commits to clear payment.

• Export Licence:

1. Obtained from authorities.
2. Mandatory for exporting goods.
3. A valid license is required for customs.

• Warehouse Receipt:

1. Issued after paying duties.
2. Confirms payment of charges.

• Health Certificate:

1. Mandatory for food exports.
2. Certifies compliance with health standards.
3. Ensures fitness for human consumption.

Checklist for Trade Documents: Exporting from India

1. Shipping Bill: The important document that every business needs to export products from India is the shipping bill. The names and contact information for the buyer, seller, and shipowner through whom the items are now being transported are all listed in this document.
2. Customs Declaration Form: On this form, information about the imported or exported products is listed.
3. Customs Invoice: After receiving a particular form from the importing country’s customs authority, the majority of North American countries demand the delivery of this document. This facilitates the transfer of commodities at a favorable tariff or under a trade agreement to the nation importing them.
4. Dispatch Note: This note notifies the transporter of the steps to follow if the recipient’s address is discovered to be inaccurate.
5. Insurance document: One of the documents needed for import customs clearance is an insurance certificate. A required document for the importer’s delivery terms statement is the insurance certificate. Customs officials can verify if insurance is included in the selling price by looking at the insurance certificate included with the import shipment. Finding the assessable value, which establishes the import duty amount, is necessary.
6. Industrial License: As per government regulations, it is only applicable to a few types of items. A copy of an industrial license that is presented during the customs clearance process might assist the importer in receiving several import benefits.
7. Packing List: A packing list is a very significant document that lists all of the different things that a trader is exporting.
8. GATT and DGFT Declaration: The General Agreement on Tariff and Trade declaration and Director General of Foreign Trade declaration are to be filed by 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.
9. Certificate of Inspection: This document certifies that the packing list has indeed been examined and only the items listed by the exporter are present. This also indicates that the item’s condition is acceptable for shipment.
10. 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.
11. Registration cum Membership Certificate (RCMC): Not a mandatory requirement, but used for gaining exemption on import duties. These exemptions are available on goods issued under the RCMC. This certificate needs to be presented along with the other import documents to the customs official.
12. Black List Certificate: Several nations in the globe want to restrict trade with one another due to geopolitical or military issues. Countries use the “Black list certificate” to check that imported commodities haven’t come from or haven’t gone through hostile areas.
13. Chemical Analysis Certificate: Chemicals such as dyes, metals, and potentially dangerous solutions, among others, must all be analyzed to ensure the highest quality.
14. Certificate of Shipment: This document attests that the goods in a shipment were entirely manufactured or processed in a certain nation. There may be additional paperwork needed when exporting. For a comprehensive description of your unique business requirements, get the best service from Vakilsearch by contacting our experts.

Checklist for Trade Documents: Importing to India

• Bill of Entity

A vital document for import customs clearance is the bill of entry, which must be properly signed and filed by the Customs House Agent (CHA) or the importer. It is a measure of the country’s total outward remittance and should be submitted within 30 days of goods arrival. After receiving the bill of entry and necessary documents, customs officials assess and inspect the items. A “pass out order” is then issued, allowing the importer or their agent to remove the imported items from customs upon payment of applicable fees to the carrier and cargo custodian.

• Commercial Invoice

The most crucial document in a commercial deal is this one. A commercial invoice is used to determine the commodity’s worth. The customs official contrasts the commodity’s actual market value with the value provided on the business invoice. This technique stops importers from engaging in dishonest practices like under and overcharging.

• Bill of Lading / Airway bill 

One of the documents needed for import customs clearance is the BL/AWB.

To clear customs for imports, carriers are required to present a bill of lading for marine shipments or an airway bill for air shipments. The carrier’s air bill or bill of lading contains information on the goods and the terms of delivery. 

• Insurance Certificate

This certificate helps the customs offer to assess 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.

• Import License

According to the regulations outlined by the government, an import license is necessary for a certain range of items. An import license is necessary for customs clearance since the government regulates the flow of these items into the nation. To give an insight, some examples of these items include precious metals and stones, goods derived from petroleum, medicines, and chemicals.

• Order Form/Letter of Credit

The importer sends the seller a purchase order. The terms of the sale are stated, which is crucial for the customs officer to determine the worth of the goods. When clearing customs, the importer must present a copy of any Letters of Credit that have been issued.

• Duty Benefits

An importer can avail of 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. Concerning 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. In addition to the above-mentioned, government regulations necessitate the submission of particular documents.

Conclusion

International shipments should be cleared by customs before they’re even delivered to their consumer. Import and Export in a country should go through a customs clearance procedure. To complete this process, the importer & exporter of the items must provide acceptable documentation. We have pointed out the important documents involved in customs clearance in India. We hope this blog helps you give the best details that you should keep for future reference. Vakilsearch, the largest legal services provider in India will help you to get the best services. You can quickly get in touch with Vakilsearch professionals who can guide you through the technicalities that you need for customs clearance.

FAQs

What are the custom documents?

Custom documents refer to the paperwork required for international trade, detailing the nature, quantity, and value of imported or exported goods. These documents, including invoices and certificates, ensure compliance with customs regulations and facilitate the smooth movement of goods across borders.

What is required to clear customs?

To clear customs, essential documentation includes a commercial invoice, packing list, bill of lading or airway bill, and relevant permits or licenses. Compliance with import/export regulations, accurate valuation, and adherence to country-specific requirements are crucial for successful customs clearance.

What is a checklist in customs clearance?

A customs clearance checklist outlines essential steps for smooth import or export processes. It typically includes verifying documentation accuracy, confirming compliance with regulations, ensuring proper valuation, and securing any necessary permits. A comprehensive checklist aids in avoiding delays and complications during customs clearance procedures.

What is the first check examination in customs?

The first check examination in customs involves an initial inspection of goods upon arrival. Customs officials conduct this examination to verify declared information, assess the physical condition of goods, and ensure compliance with regulations. The first check examination helps identify any discrepancies or anomalies in the declared cargo.

What is the bill of entry?

The bill of entry is a crucial customs document that provides details about imported goods. It includes information such as the description of goods, their value, quantity, and origin. Customs authorities use the bill of entry to assess duties and taxes, ensuring accurate record-keeping and facilitating the smooth flow of goods through the customs process.

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