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TMI BlogSecurity under section 59 (3) of the Customs ActX X X X Extracts X X X X X X X X Extracts X X X X ..... Finance Act 2016) requires an importer of goods filing a bill of entry for warehousing to submit a Bond in a sum equal to thrice the amount of duty assessed on the goods to be warehoused. The bond can be: (a) for a single consignment; or (b) a general bond to cover multiple imports by an importer within a specified period. The format of the bonds has been prescribed under Circular no. 18/2016- Cus dated 14.05.2016. 3. Sub-section (3) of section 59 prescribes that the importer, shall, in addition to the execution of a bond, furnish a security. The Board has reviewed the extant circulars regarding furnishing of security for transit as well as for storage of goods in the warehouse. In sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the duty involved on the goods, in favour of the President of India. Transit will refer to movements from: (i) the customs station of import to the warehouse; or (ii) a warehouse to another warehouse; or (iii) a warehouse to a customs station for export. However, in certain cases, such as, liquid bulk cargo being transported through pipelines, the requirement of transit insurance may be waived. For storage (a) Goods, other than sensitive goods mentioned in para (b) below, permitted to be warehoused, will be subject to the following requirement of security under section 59 (3): (i) for the initial period of one year, there shall be no requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ond one year will be subject to the importer or owner furnishing a security by way of a bank guarantee for an amount equivalent to 50% of the sum of duty plus interest accrued thereon during the preceding period; and (iii) any extension in warehousing period beyond two years will be subject to the importer or owner furnishing a security by way of a bank guarantee for an amount equivalent to the duty involved and interest accrued thereon during the preceding period; (d) However, if the sensitive goods are proposed to be stored in the importer's private bonded warehouse: (i) the importer shall furnish a security by way of a bank guarantee equivalent to the duty involved at the customs station of i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... powered to extend the period of warehousing, beyond the initial period of one year, for up to a year at a time. The second proviso provides that while extending the period of warehousing he may consider curtailing such period depending upon the likelihood of deterioration of the warehoused goods. In this connection, it may be noted that in cases referred in para 5, a security has to be obtained while granting extension. Alongside the security, a declaration that the goods shall not deteriorate during the period of extension being sought should also be obtained from the importer or owner. 7.2 However, where the Principal Commissioner or Commissioner of Customs is of the opinion that the goods are likely to deteriorate during th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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