Bonded facility ---- alertness about misuse - Customs - 019/2000

Circular No.19/2000-Cus.VI F.NO. 502/24/99-Cus. VI Government of India Ministry of Finance Department of Revenue Central Board of Excise Customs New Delhi, the 14 th March, 2000 Subject: Bonded facility ---- alertness about misuse It is brought to the notice of the field formations that an alleged fraud had been committed at Chennai wherein a CHA has defrauded the department by way of evasion of Customs duty by misusing the bond facility. 2. Available report indicates that the CHS would clear the imported raw material from Customs on the pretext of bonding. The raw material would then be taken the CHA premises wherein they would be substituted with material of no. value. The imported would then be sent to the importer with fabricated B/ E’s for theme consumption. Based on the fabricated Bill of Entry the importer would take MODVAT credit. Meanwhile the substituted material(packed in original packing ) would be deposited in the warehouse for bonding. 3. Since the aforesaid case involves substantial amount revenue, the matter has been refereed to CBI for the through inquiry. The field formations may like to undertake an ab initioo stock challenge of all bonded goods lying in the public bonded warehouse beyond 1 year and also to direct the bond section of Customs House , to reconcile the records with the record of the warehouse. 4. SIIBs and Preventive Branches may also be asked to profile the high risk bonded goods/importers and to selectively draw out samples of suspect cases in order to rule out similar frauds. 5. The Board may kindly be kept informed of the outcome of this exercise.