Guidelines for handling and storage of valuable goods that are seized/ confiscated by the Department - Customs - F. No. 394/97/2015-Cus (AS)

INSTRUCTION F. No. 394/97/2015-Cus (AS) Government of India Ministry of Finance Department of Revenue Central Board of Excise Customs (Anti-Smuggling Unit) New Delhi, dated 1 st December, 2015 To All Principal Chief/Chief Commissioners of Customs All Principal Chief/Chief Commissioners of Customs (Preventive) All Principal Chief/Chief Commissioners of Customs Central Excise All Principal Chief/Chief Commissioners of Central Excise All Principal Chief/Chief Commissioners of Central Excise and Service Tax All Principal Directors General/Directors General All Principal Commissioners/Commissioners Web Master, CBEC. Madam/Sir, Subject: Guidelines for handling and storage of valuable goods that are seized/ confiscated by the Department- reg. In terms of Section 110 of Customs Act, 1962 if the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods that may include valuables such as gold. In the recent past, the smuggling of high value goods, especially gold is on the rise, as evidenced by the increasing number of seizures made by Directorate General of Revenue Intelligence and the field formations. At the same time, there have been instances of loss/theft of gold and high value goods from the strong rooms/ seized goods godowns reported by the field formations. Though, there are detailed guidelines for handling and storage of seized/detained and confiscated goods, the recent cases of loss/theft of valuables raise a serious concern over the way these guidelines are implemented by the field formations. In order to prevent such loss/theft of valuables in future, the following guidelines are issued re-inforcing/ re-iterating and in continuation of the existing instructions/circulars in this regard for strict compliance by all field formations. The previous instructions/guidelines in this regard shall be deemed to be modified and revised to the extent specified in this instruction. 2. Valuables: For the purpose of these guidelines, the valuables include: i. diamonds, precious and semi-precious stones, pearls, gold/silver; ii. articles including jewellery made of or containing these valuables mentioned at (i) above; iii. high value watches; iv. currency including foreign currency; and v. such other articles of small bulk and high value as Commissioner of Customs may by special or general order specify as valuables. 3. Custodian 3.1. Only experienced officers whose integrity is absolutely beyond doubt, should be posted as incharge of the strong room/ valuable godown. Similar check from vigilance integrity angle should also be ensured for the superior officer who is given the overall supervision of the strong room and custody of the second key. 3.2. Whenever the Custodian or his superior officer is transferred, a regular substitute should be provided, who shall take proper charge of the strong room/valuable godown. The details of handing over/taking over shall be entered in a register for which the format is given in Annexure-I. 4. Storage Place/Strong Rooms: 4.1. Valuables should be kept in a strong room or in a locker in a nationalized bank, obtained exclusively for the purpose. The packages shall be stored systematically, serial-wise and year-wise to facilitate easy check and location. 4.2. When the valuables are stored in a strong room, following measures must be taken strictly: i. The strong rooms storing valuables should have a double lock system, ii. The two keys for operating the strong room should be entrusted to two separate officers; one to the Custodian and the other to a superior/supervisory officer of gazetted rank; iii. It must be ensured that the strong room/valuables godown can be opened only when the two keys are used. iv. Both the Custodian and the Supervisory officer shall collect and deposit keys of strong room/ valuables godown in an iron box bound by thick thread (sutli) and sealed with lac seal over a paper slip bearing the names, designation and signatures of the Custodian and Supervisory officer. The name and designation should be clear and legible. Preferably, tamper proof paper seal/sticker may be used. v. The locks of the strong room/ valuables godown shall be sealed when not in use. The lock shall be covered with fabric tape and sealed by lac over paper slip bearing the names, designation and signatures of the Custodian and Supervisory officer. The name and designation should be clear and legible. Preferably, tamper proof paper seal/sticker may be used. 4.3. No person other than the Custodian shall enter the strong room/ valuables godown unless otherwise authorised by the Commissioner of Customs. No officer, including Custodian-in-charge of the strong room / godown, shall be allowed to open the strong room/ godown on any holiday (including Saturday/Sunday), except with a prior written permission from the Additional /Joint Commissioner concerned. The reasons for opening on holidays shall be clearly recorded by the Additional /Joint Commissioner while giving such permission. 4.4. When the valuables are stored in locker/safe, the key of the safe or the locker shall be kept securely in the personal custody of the Custodian. It should also be ensured that the access to the safe or the locker shall not be allowed by the Bank Manager except on a written authorization in an agreed form bearing the running number, signed by the Deputy/Assistant Commissioner in charge of the disposal Section of the Commissionerate. Such authorization should be issued normally in the name of the Custodian or in exceptional circumstances when the Custodian is not available, in the name of any other responsible officer. The serially numbered authorization forms should be kept in the personal custody of the Deputy/Assistant Commissioner in charge of the disposal. 4.5. The strong room/valuables godown shall have additional security features like CCTV Camera at the most vantage point(s) to keep round the clock surveillance. The monitoring of such CCTV Camera shall be done by the Deputy/ Assistant Commissioner in charge of strong room / valuables godown. The daily recordings of the camera shall be taken as a backup and kept with the computer centre/systems unit. 4.6. In many cases it has been observed that by the time the case is finalized, the seized currency / bearer negotiable instruments becomes out of circulation or time barred. Therefore, in the cases of seized currency or bearer negotiable instruments, as the case may be, the genuineness may be checked immediately with the nearest bank available in the vicinity. In respect of seizure of valuables, the same may be got appraised before seizure. 5. Inventory: 5.1. Whenever any valuables have been seized or detained by a proper officer under the Customs Act, he shall prepare an inventory of such goods. Such detailed inventory of these goods shall be prepared by the seizing officer at the time of detention/seizure in prescribed format given in Annexure-II in triplicate. During making of such inventory, the packages of the valuable goods shall be clearly numbered. 5.2. First copy of the inventory shall be given by the seizing officer to the person from whom the goods are seized. The goods together with the duplicate and triplicate copies of the inventory shall be forwarded, within 24 hours of the seizure/detention, to the officer posted as Custodian of the strong room/valuable. The Custodian shall acknowledge the receipt of the goods on both, the duplicate and triplicate, copies of the inventory and return the duplicate copy thereafter to the seizing officer for keeping the same in the seizure case file. The Custodian shall put signature with complete name and official stamp and the same shall be clear and legible. 6. Packaging and sealing: 6.1. The valuables that are seized /detained shall be packed in non-deteriorating containers like high density plastic or metal boxes. These containers shall be sealed with wire/metal seals instead of rope/wax seals. A paper seal/sticker mentioning the relevant details as given in Annexure III shall be affixed on the containers (preferably tamper proof seal/stickers shall be used). The packaging and sealing shall be done in the presence of the person from whom the valuables are seized/ detained and two independent witnesses. The paper seal/sticker shall have the signatures of the person from whom the valuables are seized, the independent witnesses and the seizing officer. The names should be written completely, clearly and legibly. If tamper proof seal/stickers are not used a lac seal shall be used with a paper slip mentioning relevant details as mentioned above ( Annexure III ). 6.2. The responsibility to keep the valuables in safe custody lies with the seizing officer till the valuables are deposited with the Custodian in the strong room/valuables godown. 7. Receipt of Valuables by the Custodian: 7.1. Immediately on receipt of the seized goods and the duplicate and triplicate copies of the inventory, the Custodian shall satisfy himself that the packages have been properly sealed, seals are intact and the inventory has been prepared in a proper manner indicating all the details required with regards to the contents of the packages. The Custodian shall not accept the packages if the package is improperly sealed or the seal is not intact or if the package does not contain the details as mentioned in para 6.1 above. 7.2 If the condition of the packages, seals and the Inventory are found to be in order, the Custodian shall receive the goods and make entries thereof in the Stock Register (Valuables Register) for which prescribed format has been given in Annexure IV . He shall then acknowledge the receipt of the sealed packages by way of making cross references of entries in the duplicate and triplicate copies of inventories and thereafter retain the triplicate copy with him and return the duplicate copy to the seizing / detaining officer for keeping the same in the seizure case file. Digital photograph / videograph of the packages shall also be taken and preserved in the computer of the Custodian so that in the event of any tampering, it can be cross verified with the original packing. Back up copies of such photograph, videograph shall be kept at the systems unit. 8. Safe custody of valuables: 8.1. The responsibility of proper storage and custody of these goods shall be on Custodian.The Custodian shall be responsible for the physical custody of the packages with seals intact. He shall, however, not be responsible for the contents of the package/s if the same was received properly sealed with the seals intact thereon. The Custodian shall also ensure that the packages are carefully stored and protected against the ravages of weather, ants, rodents, insects etc. 8.2. The Custodian should take adequate precautions against theft and pilferage and keep watch on the condition of the goods and immediately report each such case to the Commissioner. Any incident of the theft/loss/substitution of the goods, which comes to light should not only be immediately examined personally by the concerned Commissioner, but it should also be, with the exception for petty cases, immediately reported to the Principal Accounts Officer and the Statutory Audit Officer etc. as laid down under Rule 16 of General Financial Rules. Board should also be kept informed of all such cases, on immediate basis, with a report of action initiated. 8.3. If the package show signs of tampering or damage, the Custodian should immediately bring it to the notice of the Deputy/Assistant Commissioner, in charge of Disposal Section, for appropriate action. Where the goods are involved in court proceedings, it will be necessary to bring the matter to the notice of the court and for getting necessary order from the court for the further course of action. All packages pending for more than five years should compulsorily be inspected for deterioration of packages/ seals and the same may be brought to the knowledge of the Deputy/Assistant Commissioner Disposal for appropriate action. 8.4. The Custodian shall be responsible for maintaining the Stock Registers in the proper manner; proper custody of Registers for handing over; and Taking over charge and Inventories and for submitting the monthly return of goods ripe for disposal. 9. Movement of Valuables: 9.1. In case of seized/ confiscated valuables to be taken out for producing before court or for any other purposes as the situation may warrant, written order must be issued by Deputy / Assistant Commissioner in charge of strong room/ valuables godown. Such order shall specify, among other things, the following: the name of officer/Custodian who shall carry the valuables out of the strong room/valuables godown, the purpose for which the goods are taken out, the place where the goods are being taken to, the date and time of opening of the strong room/ valuables godown. A separate file shall be maintained for issuance of such orders by the Deputy / Assistant Commissioner in-charge of strong room / valuables godown. Whenever he is transferred, the file shall be handed over to the successor under a proper acknowledgement. 9.2. The officer/custodian who carries the goods shall verify the description, condition of the seal, other relevant details to ensure that the correct package is taken out in relation to the case file. 9.3. A movement register shall be maintained by the Custodian for this purpose in the format given in Annexure - V . Due care should be taken to indicate details of such movements in the Movement Register by the Custodian on each such occasion and shall also make a corresponding entry in the remarks column in Valuable Register. 9.4. The officer who carries the goods to the court or any other place shall be present at the time of opening of package(s) and its/their subsequent sealing. 10. Inspection: 10.1. Quarterly inspection of such seized/ confiscated valuables stored in the strong room/ safe shall be carried out and stock of all packages and condition of each package lying there should be done by the committee headed by Deputy /Assistant Commissioner in charge of valuable godown and proceedings of such inspection shall be drawn and kept in the file maintained by Deputy / Assistant Commissioner in-charge of strong room/ valuables godown. 10.2. The Quarterly inspections shall be video graphed and a soft copy of such video recording shall be kept in a sealed envelope with the Systems Unit. 11. Record Keeping: 11.1. All files/registers/records must be kept in the safe custody of Superintendent of Customs/Superintendent of Central Excise in charge of strong room/valuable godowns. 11.2. The disposal section shall maintain a Master Instruction File containing all instructions on storage and disposal of seized/ confiscated goods issued from time to time. This is important for institutional memory. This Master Instruction File should be handed over to the successor by the Custodian at the time of handing over charge. 12. Miscellaneous: 12.1. The Gold in all forms including bullion, ingots, coins, ornaments and crude jewellery and Indian and foreign currency are covered under Notification No.31/86-Cus dated 05.02.86, as amended, issued under Section 110 (1A) of the Customs Act, 1962. Proper record including entry in valuables register must be kept on such occasions when the action under Section 110 (1B) of customs Act 1962 is initiated. 12.2. In case of seized currency or bearer negotiable instruments as the case may be, Action under Section 110 (1B) of Customs Act 1962 shall be initiated immediately after seizure and a proper record including entry in valuables register must be kept. Thereafter, it shall be immediately deposited with the bank in the Government Account. In this regard the Superintendent in charge of strong room/valuables godown shall obtain a certificate from the bank regarding such deposit specifying denominations of currency and the exchange rate prevailing on the date of deposit. 12.3. At the time of disposal, valuables shall be taken up for disposal by the Inventorisation Committee so authorised by the Additional/Joint Commissioner. All The proceedings of opening and inventorisation shall be done under videography and the soft copy shall be kept in the safe custody of Superintendent in charge of strong room / valuables godown. In this regard, a register for Disposal of valuable by the Department shall also be maintained as given in Annexure -VI. 12.4. The officers are advised to keep themselves abreast with the legal provisions on the basis of which different procedures have evolved. In case of necessity for further clarity, cross referencing to necessary provisions of the Customs Act, 1962 and notifications issued thereunder may kindly be made. Further, wherever required, requisite permission from competent authorities may also be obtained. 12.5. When situation warrants discretion on part of the officers, it should be exercised in the context of existing laws. 12.6. All Principal Chief/ Chief Commissioners of Customs, Customs (P), Central Excise Service Tax should pay personal attention to ensure that the guidelines/safeguards prescribed for custody, accounting, disposal of seized/confiscated goods including valuables, are enforced scrupulously in their jurisdiction, so as to avoid any instances of loss, pilferage, damage, theft, misappropriation or missing/substitution of the goods. 13. These guidelines shall be widely circulated to all field formations. Difficulties, if any, in implementation of the aforesaid guidelines may be brought to the notice of the Board. 14. This letter may kindly be acknowledged. This issues with the approval of the Board. Yours faithfully, (M.G. Thamizh Valavan) Director (AS) Encl: As above Annexure I Format of the register showing succession of Custodian and Supervisory of Strong room/ valuables godown 1. For the Custodian S.No. Name and designation of the Officer Date of taking over Date of Handing over Order reference Counter sign of the immediate superior officer 2. For the Supervisory officer (Gazetted Rank) S.No. Name and designation of the Officer Date of taking over Date of Handing over Order reference Counter sign of the immediate superior officer ANNEXURE-II Inventory of goods detained/seized 1. Owner of the goods/ Passenger: a. Name: .. b. Father s/Spouse s Name: c. Occupation: . d. Address: i. Door Number: . ii. Building/Premise: iii. Street: .. iv. Locality: .. v. City/District: vi. Pin Code: . vii. Proof Address: Passport Number/Other: . 2. Seizing/Detaining Officer: a. Name: .. b. Designation: 3. Place of seizure/detention: i. Door Number: . ii. Building/Premise: iii. Street: .. iv. Locality: .. v. City/District: vi. Pin Code: . vii. Proof Address: Passport Number/Other: .. 4. Date of Seizure (DD/MM/YYYY): 5. Seizing Unit: 6. Case file No.: 7. Witnesses (i) Witness -1 a. Name: .. b. Father s/Spouse s Name: c. Occupation: . d. Address: i. Door Number: . ii. Building/Premise: iii. Street: .. iv. Locality: .. v. City/District: vi. Pin Code: . (i) Witness -2 a. Name: .. b. Father s/Spouse s Name: c. Occupation: . d. Address: i. Door Number: . ii. Building/Premise: iii. Street: .. iv. Locality: .. v. City/District: vi. Pin Code: . 8. Details of Seized goods Packages and its contents: 1 2 3 4 5 6 7 Sr. No Details of the Package containing goods Detailed Description of the goods Quantity (in clearly defined units without any scope for ambiguity) Country of Origin if any Total estimated market value Remarks 9. Signature of the Owner / Passenger: 10. Signature of the Seizing Officer: 11. Signature of the Witness-1 12. Signature of the Witness-2 13. A specimen of the seal affixed on the packages Received with seals intact. Entered in valuables register vide entry . Dated .. Signature of the Custodian (valuables) Name: Designation: Annexure- III Format of the Tamper proof paper label (To be affixed on the container in which seized valuables are kept and sealed) 1. Case File Number: 2. Date and Place of Seizure: 3. Panchnama date: 4. Contents: 5. Name and Signature of the Owner of the goods with date: 6. Name, Designation and Signature of the Seizing Officer with date: 7. Name and Signature of the Witness -1 with date 8. Name and Signature of Witness-2 with date Annexure - IV Format of Valuables Register 1 2 3 4 5 6 7 8 9 10 11 12 Sr. No Date of receipt Case file No. Deposited by: Name and designation of Officer Name Address of the Owner No. of packages Whether accompanied by inventory (in prescribed format) Description of goods Quantity as given in the Inventory Condition of sealing Estimated Value: Duty: Date of preparation of inventory 13 14 15 16 17 18 19 20 21 22 Name of officers present at the time of preparing detailed inventory Location of Storage in the strong room Date of re-opening/ Movement if any Order reference for re-opening /movement and entry no. in the movement register Details of proceedings drawn for re-opening File No. Mode of Disposal Date of release/ disposal Names of officers present at the time of release of goods Signature of recipient with Name Address Entry No. in the disposal register Annexure V Format for Valuables Movement Register Sr. No Name of AC/DC authorising movement File No. Purpose of taking out and the place to which it is taken Names, Designation, Signature of the officer taking the valuables Date and Time of Taking valuables Gross weight 1 2 3 4 5 6 7 Date and Time of Depositing of valuables Gross weight Whether opened and resealed and if so the details there of Name and Signature of Custodian Name and signature of Supervisory officer Remarks If any 8 9 10 11 12 13 Annexure VI Format for Register for Disposal of Valuables by the Department Date fixed for Inventorisation for disposal Details of disposal orders Date of Reopening for the purpose of valuable of Jewellery/ Gold/ valuable etc. Date of disposal and place Amount of sale proceeds Remarks, if any 1 2 3 4 5 6