Transshipment of imported containerized cargo from gateway port to another port/ICD/CFS in India: - CBEC's Customs Manual 2023 - Customs

2. Transshipment of imported containerized cargo from gateway port to another port/ICD/CFS in India: 2.1 The transshipment procedure of imported cargo is governed by Section 54 of the Customs Act, 1962 read with Goods Imported (Conditions of Transshipment) Regulations, 1995 as well as relevant Board's circulars and instructions. 2.2 Transshipment Permit is the permission granted by the Customs, at the port/airport of unloading of imported goods, to shipping agents for carriage of goods to another port/airport/ICD/CFS in India. The shipping agent submits an application along-with transshipment forms (5 copies), sub-manifest and a copy of IGM to the Customs. The Customs scrutinizes the details furnished by the shipping agents in the application for transshipment. In case, the documents are in order and there is no alert notice against the shipping agent, permission for transshipment is granted. 2.3 To ensure that imported cargo, on which duty has not been paid, are not pilfered en-route to another port/airport/ICD/CFS and reach safely, a bond with bank guarantee is executed by the carrier engaged for the transshipment of the goods. The quantum of bank guarantee for transshipment to be furnished by different categories of carriers is as below: (i) The carriers in public sector (Central/State Government Undertakings) are exempt. (ii) All carriers (shipping lines/ICDs/CFSs/other carriers) of containerized cargo handling more than 1000 TEUs as import containers in a financial year, are exempt, irrespective of the fact whether movement is by road or coastal shipping or rail. Further, request of carriers having annual transshipment volume below the limit of 1000 TEUs but having good track record may be considered for exemption from BG on merit by the jurisdictional Commissioners of Customs. (iii) The custodians of ICDs/CFSs operating as carriers of transshipment cargo between gateway ports and their ICDs/CFSs shall in their terms and conditions of their bank guarantees executed with Customs for custodianship of ICDs/CFSs cover safety and security of cargo being transshipped by them. The details of such bank guarantee shall be informed to the Commissioner of Customs having jurisdiction over the gateway port. The custodians of ICDs/CFSs shall be allowed to transship the cargo against the said bank guarantee and they will not be required to execute a separate bank guarantee for transshipment. (iv) The remaining carriers are required to furnish bank guarantee @ 15% of the bond amount. 2.4 The terms of the bond is that if the carrier produces a certificate from Customs of the destination port/airport/ICD/CFS for safe arrival of goods there, the bond stands discharged. In case such certificate is not produced within a month or within such extended period as the proper officer of Customs may allow, an amount equal to the value, or as the case may be, the market price of the imported goods is forfeited. 2.5 The bond value should be equal to the value of the goods. However, considering the difficulties of shipping agents in producing documents for determination of value of the goods sought to be transshipped, the bond value is determined on the basis of notional value of the goods, which is an average value of cargo per container transshipped in the past. 2.6 To avoid multiplicity of bonds, the carriers are allowed to execute a running mother bond instead of individual bonds. The value of mother bond can be arrived on the basis of the average number of containers carried per trip, the average time taken for submission of proof of safe landing of containers at the destination ICDs/CFSs, frequency of such transshipment as well as notional value of cargo per container. As mother bond is a running bond, its amount may be high. If a running bank guarantee @ 15% of total bond amount is taken, it may block huge sum of money. To avoid blockage of money of carriers, an option has been given to furnish either a running bank guarantee or individual bank guarantee for each transshipment, the latter being released as soon as the landing certificates from destination Customs are produced. 2.7 The bond or mother bond and bank guarantee are debited at the time of transshipment of import/export containers at the port of origin, and credited on receipt of proof of safe landing of containers at the port/ICD/CFS of destination. Further, EDI system has a 'bond module' while will be fully utilized once 'message exchange facility' is operationalised between two ports. In an online environment, bond re-credit is done automatically in the EDI system on receipt of electronic message between Gateway port and destination port or between two Customs stations. 2.8 On lines of similar provision for waiver of bank guarantee in case of transhipment of cargo from the gateway port to feeder ports/ICDs/CFSs and vice versa, bank guarantee is waived for air cargo transhipment. Accordingly, airlines/other carriers having annual transhipment volume above 2500 MT to/from any airport are exempt from Bank Guarantee for carriage of transshipment goods. Further, in deserving cases the jurisdictional Commissioners of Customs may consider giving waiver of bank guarantee. [Refer Circular No. 24/2006-Cus, 25-8-2006 ] 2.9 After issuance of transshipment permit and execution of bonds, containers are sealed with 'one time bottle seal' by the Customs. In case, containers are already sealed with 'one time bottle seal' by the shipping agents, there is no requirement of sealing again by the Customs. In such cases, shipping agents are required to inform the serial number of seals to Customs, which is just verified by the Customs. 2.10 After sealing and/or checking of seals by Customs, containers are moved from the gateway port and carried by the shipping agents to destination port/ICD/CFS by vessels, rail or road. Transshipment formalities in all these modes are similar. 2.11 To optimize the capacity utilisation of vessels, Indian flag foreign going vessels operating in routes covering more than one Indian port to a port outside India and vice versa, have been allowed to carry coastal containers alongwith imported/export cargo between two Indian ports. Further, coastal vessels have also been allowed to carry coastal containers along-with imported/export cargo between two Indian ports. However, to guard against the possibility of replacement of transshipment goods with domestic containerised cargo, some safeguards have been prescribed. All the transshipment containers as well as domestic containers are required to be sealed by 'one time bottle seal' at the port of loading. The domestic containers are required to be suitably painted with bold letters For Coastal Carriage only' for their identification. Carriers are also required to file a manifest for domestic containers. Provisions of sections 30 41 of the Customs Act, 1962 have been made applicable to Coastal vessels loading or unloading coastal goods at EXIM berths. The Master of the vessel or his agent shall submit the following: (a) a coastal arrival manifest for the goods which are unloaded or meant to be carried forward to other destination ports (b) coastal departure manifest for the goods loaded including goods on board for other destinations The arrival and departure coastal manifests shall be prepared in duplicate. The original shall be submitted to the proper officer and duplicate would be retained by the Master of the vessel or his agent. The arrival manifest is to be submitted before the arrival of the vessel and the departure manifest is to be submitted before the departure of the vessel. There shall be no examination of the coastal goods, the container shall be sealed with tamper proof one time bottle seal and then the same can be loaded on to the vessel. Noncontainerized cargo shall also be allowed to be loaded on to the vessel provided it is clearly marked on the packing 'For Coastal Carriage Only' to make it easily identifiable. The preventive officers with the prior approval of Additional Commissioner/ Joint Commissioner (preventive wing) may from time to time carry out random checks so as to ensure that no export goods or imported goods are inadvertently or by intention loaded onto such coastal vessels. [Refer Circular No. 14/2016- Customs dated 27.04.2016 ] 2.12 At the destination, carrier is required to present the sealed cover containing a copy of transhipment permit to Customs. The Customs checks the particular of containers, seals etc. with reference to transhipment permit. The carrier is required to obtain a certificate regarding landing of container from the Customs. 2.13 In case, the seals are found to be broken at the time of examination of containers by the Customs, a survey of contents of the containers is conducted in presence of Customs officer, carrier, importer or his representative and representative of insurance company. Shortage if any, noticed is recorded and is signed by all those present. The carriers are required to pay the duty for pilferage in terms of the condition of bond executed by them with the Customs at the port of loading. This is apart from other action which can be taken under Section 116 of the Customs Act, 1962 . 2.14 The carriers have to obtain the landing certificates of containers from the Customs at the destination port/ICD/CFS and submit the same to the Customs at the originating port. The Customs reconciles its record and closes IGMs on the basis of these certificates. 2.15 After safe landing of containers at the destination port/ICD/CFS, the importers or their authorised agents are required to follow all Customs formalities such as filing of Bill of Entry, assessment, examination of goods etc., for clearance of the goods.