The text appears to be a comprehensive legal document outlining ...

Bank Guarantees and Customs Bonds Must Follow SFMS Electronic Transmission Rules for Valid Processing

March 5, 2025

Circulars     Customs

The text appears to be a comprehensive legal document outlining bank guarantee and customs bond procedures. Here's the focused legal summary: The document establishes procedures for bank guarantees and customs bonds under Indian customs law, detailing obligations for importers/exporters (obligors) and banks. Key provisions include: The bank guarantee framework requires banks to undertake payment to the government up to a specified amount in case of breach by obligors. Banks must provide unconditional guarantees without demur upon government demand, with liability restricted to the guaranteed amount. The guarantee remains effective until obligations are fulfilled and certified by relevant authorities. Banks cannot revoke guarantees during currency without prior government consent. Electronic transmission through SFMS (Structured Financial Messaging System) is mandatory for operationalizing paper bank guarantees, with specific message formats and field requirements. Non-compliance with SFMS procedures may prevent guarantee confirmation and subsequent processing.

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