Overview of Customs Procedures in India – IDPMS | Faceless Assessment | AEO Certifications

Customs procedures in India are a comprehensive set of processes administered by the Customs Department, which falls under the Ministry of Finance. These procedures are designed to regulate the flow of goods into and out of the country, ensuring compliance with India’s laws and regulations. Customs procedures also include checks for banned or restricted items and the verification of declared values to prevent under-invoicing. Additionally, for exports, similar declarations and document submissions are required, with the focus on enabling Indian goods to meet global standards and entry criteria for foreign markets. These procedures are crucial for maintaining the integrity of international trade standards and protecting national interests.

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Table of Contents

1. Background of Procedures
2. Import Data Processing and Monitoring System (IDPMS)
3. Single Window Clearance – Integrated Declaration
4. Authorised Economic Operator
5. Omnibus Powers to CBIC (Board) to Relax Procedures
6. Verification of Identity of a Person Through Aadhaar Number
7. Procedure for Verification of Identity and Compliance of Exporter, Importer and Customs Brokers
8. Turant Customs
9. Faceless Assessment of Bill of Entry and Appeals

1. Background of Procedures

Goods are imported in India or exported from India through sea, air or land. Goods can come through post parcel or as baggage with passengers. Procedures naturally vary depending on mode of import or export. Procedures discussed in this article are applicable for imports by sea, air or land, but not as baggage or postal despatch.

Some general provisions relating to import/export procedures are discussed first.

Entry – ‘Entry’ in relation to goods means an entry made in a Bill of Entry, Shipping Bill or Bill of Export and includes the entry made under regulations made under section 84 of Customs Act – section 2(16) of Customs Act, as amended w.e.f. 31-3-2017.

Till 31-3-2017, ‘entry’ included label or declaration accompanying the goods if goods were imported or to be exported by post. These words have been omitted w.e.f. 31-3-2017.

Section 84 of Customs Act empowers CBI&C to make regulations in respect of form of entry, examination, assessment, transit and transshipment of goods imported or to be exported by post. Hence, now, in respect of imports by post, form of ‘entry’ will be determined by CBI&C.

Section 46 of Customs Act requires every importer of goods to make ‘entry’ by presenting to the customs officer a Bill of Entry for home consumption or warehousing in prescribed form. Section 50 of Customs Act requires every exporter to make ‘entry’ by presenting shipping bill (if goods are to be exported in a vessel or aircraft) or bill of export (in case of goods to be exported by land).

Section 84 of Customs Act provides that if the postal article is not accompanied by such label or declaration, form and manner of ‘entry’ will be as specified by Board in regulations [position after 31-3-2017].

Section 77 requires owner of a baggage to make declaration of its contents to customs officer. However, this is not defined as ‘Entry’.

Amendment to documents – Importer, exporter or ‘Person In charge’ have to submit various documents to customs authorities like Bill of Entry, Arrival manifest or import manifest (words ‘arrival manifest’ inserted w.e.f. 29-3-2018), Departure manifest or export manifest (words ‘departure manifest’ inserted w.e.f. 29-3-2018) etc. Sometimes, it may become necessary to amend the document due to various reasons like change in classification, clerical mistake in document, change in unloading/loading plan of vessel etc. In such case, permission to amend these documents can be given by customs authorities, in such form and manner and within such time, subject to such restrictions or conditions as may be prescribed  [section 149 of Customs Act as amended w.e.f. 1st August 2019].

Such permission can be given if there are no fraudulent intentions.

Bona fide and inadvertent mistake can be rectified – CC v. N C John (2022) 380 ELT 241 (SC).

In ACC for Appraisement v. Associated Forest Prod. 2000 (115) ELT 37 (SC), it was held that amendment to Bill of Entry will relate back to the original date on which Bill of Entry was submitted – same view in Sai Shipping Agencies v. CC 2006 (202) ELT 467 (CESTAT).

However, if bill of entry is amended by change of name of consignee, earlier importer ceases to be importer and new consignee becomes importer. Hence, date when bill of entry is filed by new consignee will be relevant for rate of duty and rate of exchange. The reason is as per section 2(26), importer includes any person holding himself to be the importer. – CC v. Binani Metals 2001(130) ELT 909 (CEGAT).

Time limit and condition for conversion of shipping bill after export – Shipping Bill (Post export conversion in relation to instrument based scheme) Regulations, 2022 provide that conversion of shipping bill after export is permissible within one year from date of export. This period is extendable by 6 months and again by further six months with permission (total two years). Conditions for such conversion have been specified in the Regulations. There should be no contravention by exporter of Customs Act and all conditions required for instrument need be complied with.

Amendment after clearance and conversion of shipping bill – In case of bill of entry, shipping bill or bill of export, it can be amended after clearance only on the basis of documentary evidence which was in existence at the time the goods were cleared, warehoused or exported, and not on basis of any subsequent document. [proviso to section 149].

In Ashok Leyland Ltd. v. CCE 2004 (173) ELT 518 (CESTAT), it was held that amendment u/s 149 is only for alteration, addition or deletion of the particulars therein, at the discretion of customs officer. Reassessment is not permissible u/s 149.

However, in Taksal Pharma v. CC (2008) 232 ELT 345 (CESTAT SMB), it was held that if there is any mistake in Bill of Entry, importer can approach department for reassessment under section 149 of Customs Act and then claim consequential refund – same view CC v. Swatch Group (2009) 235 ELT 383 (CESTAT SMB).

Conversion of ‘Zero Duty EPCG shipping bill’ to ‘Zero Duty EPCG and drawback scheme’ shipping bill is permissible – CC v. Gokaldas Images (2011) 270 ELT 426 (CESTAT SMB).

Amendment to export or import documents by importer or exporter himself – Presently, section 149 of Customs Act empowers proper officer to amend export or import document.

Now, such amendment may also be done electronically through the customs automated system on the basis of risk evaluation through appropriate selection criteria – second proviso to section 149 of Customs Act inserted w.e.f. 28th March, 2021.

Such amendments, as may be specified by CBI&C, may be done by the importer or exporter on the common portal – third proviso to section 149 of Customs Act inserted w.e.f. 28th March, 2021.

Good step towards ease of doing business.

As per Notification No. 36/2021-Customs (N.T.) dated 29-3-2021, amendments in the bill of entry presented under the second proviso to section 46(3) of the Customs Act, supplementing of Bill of Lading details in the Bill of Entry, may be done by the importer himself on the common portal.

Correction of clerical mistake – As per section 154 of Customs Act, Central Government, Board or any customs officer can correct any clerical or arithmetical mistake in any decision or order, from any accidental slip or omission. As per section 149, amendment of any document is permissible. It has been held that refund can be granted if such correction is made. Case law discussed under ‘refunds’ [In my view, it is safer to file appeal.]

Fees for amendment of documents or obtaining certified copy of customs documents – As per Levy of Fees (Customs Documents) Regulations, 1970; fee of ` 10 is payable for obtaining permission to amend a customs document. Fee of ` 50 is payable to obtain certified copy of ‘customs document’. As per the regulations, ‘customs document’ means document used in compliance with provisions of Customs Act and includes a bill of entry, shipping bill, bill of export, arrival manifest or import manifest (words ‘arrival manifest’ inserted w.e.f. 29-3-2018), import report, departure manifest or export manifest (words ‘departure manifest’ inserted w.e.f. 29-3-2018), export report, bill of transhipment, baggage declaration, show cause notice and any order passed under Customs Act.

Levy of Fees (Customs Documents) Regulations, 1970 have been amended w.e.f. 17-2-2021 to make provision for payment of Rs 1,000 as fees for handling of mismatch between shipping bill and GST returns in Customs Automated System.

Signature with name and designation – All documents should be signed by mentioning name and designation of person signing the document. – CC, Mumbai PN 73/2002(EP) dated 11-6-2002.

Merchant Overtime fee – Supervision of customs officer is required for various purposes like loading/unloading of vessels, stuffing/destuffing of containers, examination of cargo etc. No (official) charges are payable if this work is done during normal working hours and within customs area. However, if supervision is required due to urgency outside office hours or on holidays or at places other than customs station, merchant overtime is payable on payment of fee under section 36 of Customs Act. The fees and procedures are prescribed in Customs (Fees for Rendering Services by Customs Officers) Regulations, 1998.

Practice of collecting overtime fee for customs officers posted at gates of docks for supervision of movement of cargo have been discontinued by introducing 24 hours a day, 7 days week and 365 days in a year working. – MF(DR) circular No. 5/2002-Cus dated 17-1-2002.

Where working hours for clearance of cargo have been specified as twenty four hours on all days, MOT charges are not payable – amendment to Regulation on 1-4-2016.

24×7 customs clearance has been extended to many customs port for all Bill of Entry (and not only facilitating Bill of Entry), stuffing of containers and goods shipped under free shipping bills. In such case, no MOT is required to be paid. This applies to CFS attached exclusively to 24×7 ports also – MF(DR) Circular No. 4/2012-Cus dated 16-2-2017.

[Really unofficial charges are so high that no one bothers much about official MOT charges].

Provision of Central Excise Act do not provide for penalty against decisions relating to administrative expense, supervision charges, MOT fee etc. – CCE v. Sarla Polyester Ltd. 2006 (194) ELT 416 (CESTAT SMB) (same may be held in case of customs also).

Paperless Initiatives by customs – Work of customs at most of the ports and airports has been computerised. Whenever the work is computerised, documents like IGM and Bill of Entry have to be filed electronically.

Electronic filing of documents is mostly compulsory for Customs Broker, importers and exporters.

Documents can be filed through ICEGATE [Indian Customs Electronic Commerce/Electronic Data interchange (EC/EDI) Gateway] on www.icegate.gov.in. Single window clearance system has been introduced with some authorities.

Ease of doing business – reducing paper work, electronic messages – Customs department has decided to reduce paper work to minimum. For this purpose, it has been decided to either eliminate taking print outs or reduce print outs of challans, Bill of Entry etc. to bare minimum System of electronic messages is introduced in customs clearance – MF(DR) circular No. 55/2016-Cus dated 23-11-2016.

ICEDASH EoDB monitoring dashboard by CBI&C – CBIC has introduced ICEDASH dashboard for monitoring customs clearance. It is ‘Ease of Doing Business (EoDB) monitoring dashboard, which can be accessed through CBI&C website – (press news on 5-11-2019) – (2019) ELT 368 A235.

Digital signatures on various documents to be submitted to Customs – With effect from 1-4-2015 importers, exporters, customs brokers, shipping lines, airlines or their agents shall have the facility to use Digital Signature Certificate for filing Customs process documents viz. Bills of Entry, Shipping Bills, IGM (General Declaration and Cargo Declaration), EGM (General Declaration), CGM through Remote EDI System (RES). Besides ACP, all importers, exporters using services of Customs Brokers for formalities under Customs Act, 1962, shipping lines and air lines are required to file customs documents under digital signature certificates mandatorily with effect from 01.01.2016.

Digitally signed document can be filed through remote IDI system. Procedure has been specified in MF(DR) Circular No. 10/2015-Cus dated 31-3-2015.

Verification and monitoring of duty credit scrips by customs – Since customs revenue is involved, customs officers should verify and monitor export obligation under duty exemption and reward schemes. Detailed instructions are given in MF(DR) Circular No. 5/2010-Cus dated 16-3-2010. in some cases, detailed verification should be done while in some cases, random verification should be caused by Principal Commissioner/Commissioner of Customs.

Customs Clearance Facilitation Committee at major customs ports – CBI&C has advised that Customs Clearance Facilitation Committee at all major customs ports. The committee should consist of senior most functionary of departments like food safety, plant quarantine, drugs, wild life, railways, pollution control board etc. The committee should monitor expeditious clearance of imported and export goods, resolve grievances etc. – MF(DR) Circular No. 13/2015-Cus dated 13-4-2015.

24×7 customs clearance operations at some ports – 24×7 customs clearance has started at 20 sea ports and 17 airports. There is demand to provide for 24×7 clearance in ICDs also. Since requirements and local circumstances vary, Pr. Chief Commissioner/Chief Commissioner should decide about extending clearance facility at ICD beyond normal working hours – MF(DR) Circular No. 11/2022-Cus dated 29-7-2022.

Grievance redressal – As per Citizen’s charter, Customs Officers are required to carry out their tasks with integrity and judiciousness; courtesy and understanding; objectivity and transparency; promptness and efficiency. Grievance Redressal Mechanism is established for both cargo clearances and passenger clearances. Public Grievance Officer (PGO) has been designated in each Commissionerates. Public Grievance Committee has been constituted in each Commissionerate. Watch dog committee, Airport Facilitation Committee and Permeant Trade Facilitation Committee has also been constituted.

Online transmission of shipping bills and authorisations between customs and DGFT – Customs clearances are often based on authorisations issued by DGFT. Similarly, details of exports of individual exporters are to be obtained by DGFT from customs for calculation of fulfilment of export obligations etc. A system has been introduced by which shipping bills (of customs) and Authorisations (issued by DGFT under DES or EPCG scheme) will be transmitted from DGFT to customs and vice versa online – MF(DR) circular No. 3/2009-Cus dated 20-1-2009 – see also CC, Mumbai PN No. 8/2009 dated 31-3-2009.

ICEGATE – ICEGATE stands for the Indian Customs Electronic Commerce/Electronic Data interchange (EC/EDI) Gateway. ICEGATE is a portal that provides e-filing services to the trade and cargo carriers and other clients of Customs Department (collectively called Trading Partner). ICEGATE links about 15/broad types partners with Customs EDI through message exchanges enabling faster Customs clearance and in turn facilitating Foreign Trade.

SWIFT – Customs has introduced Single Window Interface for facilitating Trade (SWIFT) to integrate customs and other Participating Government Agencies (PGA) for seamless processing of import and export procedures.

One of the component of SWIFT is e-Sanchit. To introduce paperless processing under SWIFT. On e-Sanchit, system allows trader to submit all supporting documents for clearance of consignments electronically with digital signature. It is mandatory for importers w.e.f. 1-4-2018 and will be extended to exporters also. Soon, PGAs themselves upload licenses, permits, certifications, authorisations etc. issued by them. The email registered under ICEGATE will be used to communicate with beneficiary. Hence, all importers, exporters and CB should register on ICEGATE – MF(DR) circular No. 35/2018-Cus dated 1-10-2018 and 40/2018-Cus dated 13-10-2018.

The system has been extended to exports. The procedure has been prescribed in MF(DR) circular No. 43/2018-Cus dated 8-11-2018.

Three participating Governmental Agencies i.e. Wildlife Crime Control Bureau (WCCB), Central Pollution Control Board (CPCB) and Central Drug Standard Control Organisation (CDSCO) have been brought under the scheme. Documents which they can upload electronically have been specified – MF(DR) circular No. 44/2018-Cus dated 13-11-2018.

e-SANCHIT – CBI&C has introduced ‘eSanchit’ for paperless transaction. The importers are now required to upload the required documents online through www.icegate.gov.in while filling the Bill of Entry instead of submitting the physical papers. Reply to queries raised by Customs Officers can be submitted online by uploading the documents. Physical presence of paper or person for assessment related works have been done away with. CBIC is embarking on a project to bring all Participating Government Agencies (PGAs) under eSanchit wherein PGAs who issues Licenses, Permits, Certificates and Other Authorizations (LPCOs) would upload the documents themselves doing away with uploading of such document by the beneficiary (importer/exporter) themselves. Importers/Exporters, Customs Brokers and other beneficiaries are required to register on ICEGATE for this purpose.

The system has been extended to exports. The procedure has been prescribed in MF(DR) Circular No. 43/2018-Cus dated 8-11-2018.

Various PGAs were added from time to time. Two more PGA has been added to e-Sanchit platform making total to 53 PGA – CBIC Circular No. 57/2020-Cus dated 30-12-2020.

Common Customs Electronic Portal – CBI&C may notify a common portal, to be called the Common Customs Electronic Portal, for facilitating registration, filing of bills of entry, shipping bills, other documents and forms prescribed under Customs Act or under any other law for the time being in force or the rules or regulations made thereunder, payment of duty and for such other purposes, as the CBI&C may, by notification, specify – Section 154C and section 2(7B) of Customs Act inserted w.e.f. 28th March, 2021.

https://www.icegate.gov.in has been notified as the Common Customs Electronic Portal for facilitating registration, filing of bills of entry, shipping bills, other documents and forms prescribed under the Customs Act or under any other law for the time being in force or the rules or regulations made thereunder, payment of duty, functions specified to be carried out through common portal through Customs Act or rules made under section 156 of the said Act or regulations made under section 157 of the said Act and for data exchange with other systems within or outside India – Notification No. 33/2021-Customs (NT) dated 29-3-2021.

Exchange Rate Automation Module (ERAM) – Exchange Rate Automation Module (ERAM) has been launched. Foreign Exchange rates will be forwarded by SBI to ICEGATE through message exchange. The exchange rates received from SBI shall be adjusted to the nearest five paise and integrated with ICEs. These exchange rates shall be published on ICEGATE website at 6:00 p.m. as per the existing frequency and shall be accessible for public viewing on ICEGATE website i.e. https://www.icegate.gov.in. Contingency plan will be available – CBIC Circular No. 07/2024-Cus dated 25-6-2024.

2. Import Data Processing and Monitoring System (IDPMS)

Import Data Processing and Monitoring System (IDPMS) has been developed by RBI in consultation with customs authorities and other stakeholders. The purpose is to enhance ease of doing business and facilitate efficient data processing for payment of import transactions and its effective monitoring.

Banks can use the IDPMS for reporting and monitoring of import transactions. Detailed procedure has been specified in RBI AP(DIR) circular No. 05 dated 6 -10-2016.

3. Single Window Clearance – Integrated Declaration

A system of ‘Integrated Declaration’ has been introduced under the ‘Indian Customs Single Window’.

Importer/exporter has to file customs clearance documents at a single point electronically with customs. Required permission from Partner Government Agencies (PGA) will be obtained online. The PGAs include Animal Quarantine, Plant Quarantine, Drug Controller, Food Safety and Standards Authority of India, Textile Committee etc. Hard copy of NOC is not required. The procedure has been explained in MF(DR) circular No. 10/2016-Cus dated 15-3-2016 and MF(DR) instruction F No. 450/14/2015-Cas.IV dated 31-3-2016.

The Bill of Entry will be part of this ‘Integrated Declaration’.

Regulatory checks and NOC not required for clearance from customs warehouse – Under single window NOC project, all regulatory checks are applied at the time of import itself, i.e. at the time of into bond Bill of Entry. Thus, at the time of clearance from warehouse, any NOC from regulatory authority is not required (except in case of warehousing under section 49 of Customs Act i.e. warehousing pending clearance) – MF(DR) Instruction No. 450/147/2015-Cus dated 26-2-2016.

4. Authorised Economic Operator

Customs organizations all over the world are tasked with the twin challenges of securing the borders from unlawful trade and at the same time facilitating legitimate trade.

SAFE Framework of Standards was adopted by WCO in 2005, In India the AEO programme was launched in 2011 on Pilot basis vide Circular No. 37/2011-Cus dated 23.08.2011 and rolled out in full fledged manner vide Circular No. 28/2012-Cus dated 16.11.2012. In the light of international developments, as well as in view of the focus of the Government of India on “Ease Of Doing Business”, a revised AEO Programme was launched vide Circular No. 33/2016-Customs dated 22.07.2016 providing additional facilities to the legitimate trade who have demonstrated strong internal control system and willingness to comply with the laws administered by the CBI&C.

AEO Programme seeks to secure the global supply chain in partnership with business entities that are fully legally compliant and provide with the Customs the confidence to validate their security features.

In light of these objectives the AEO program was given strength vide Circular No. 33/2016-Customs dated 22-7-2016 (herein after referred to as “said Circular”), Circular Nos. 03/2018 Customs dated 17-01-2018, 26/2018 Customs dated 10-08-2018, 51/2018-Customs dated 7-12-2018, 54/2020-Customs dated 15-12-2020 and 10/2023-Cus dated 11-4-2023. This unique international instrument has ushered in modern supply chain security standards with the help of a closer partnership between Customs and business in the form of Authorized Economic Operator (AEO) programme.

The AEO programme seeks to provide tangible benefits in the form of faster Customs clearances and simplified Customs procedures to those business entities who offer a high degree of security guarantees in respect of their role in the supply chain. The SAFE Framework sets forth the criteria by which businesses in the supply chain can obtain authorized status as a secure partner. Such criteria address issues such as threat assessment, a security plan adapted to the assessed threats, procedural measures to prevent

Another facilitation scheme was Accredited Client Programme (ACP). This has been merged with AEO programme.

There is three tier programme for importers and exporters – AEO-T1, AEO-T2 and AEO-T3. These certificates are granted to importers and exporters which fulfil the required criteria.

There is single tier AEO-LO programme for logistics providers, custodians or terminal operators, Customs Brokers and Warehouse Operators.

Clarifications have been given in MF(DR) Circular No. 13/2021-Cus dated 1-7-2021 giving details of digital initiative for online filing, real-time monitoring and digital certification by AEO-T2 and AEO-T3 applicants.

As per MF(DR) Circular No. 18/2021-Cus dated 31-7-2021, there will be certification/auto renewal of AEO-T1 entities. They have to submit annual self declaration, which will be taken on record by AEO Programme Manager. There will be comprehensive compliance review by concerned zone.

Any economic operator such as importer, exporter, logistics provider and CB can apply for authorisation, if he is able to establish record of compliance in respect of customs and other legal provisions, is financially solvent and able to demonstrate satisfactory systems of managing commercial and transport records.

Application should be submitted in prescribed format. The applicant should have proper financial solvency, safety and security for procedures, premises, cargo, conveyance, personnel and business partners.

The AEO programme is on voluntary basis. Authorisation shall be granted after detailed verification and validation.

AEO Certificate is valid for three years for AEO-T1 and AEO-T2. It is five years for AEO-T3 and AEO-LO.

Post certification review is done on periodic basis.

Security in case of provisional assessment by AEO – In case imports of AEO, security is not required in case of provisional assessment and 50% bank guarantee or cash deposit in some specified cases is required – CBI&C circular No. 38/2016-Cus dated 22-8-2016 amended vide MF(DR) circular No. 19/2021-Cus dated 16-8-2021.

However, these instructions are not applicable in respect of claim of preferential rate of customs duty, in view of section 28DA of Customs Act – MF(DR) circular No. 2/2022-Cus dated 19-1-2022.

Web based application for AEO-T-1 – AEO website has been launched. AEO-T1 application can be filed. Details are specified in MF(DR) circular No. 51/2018-Cus dated 7-12-2018.

Deferred payment of customs duty for AEO-T2 and AEO-T3 importers – Importers certified as AEO-T2 and AEO-T3 can use facility of deferred payment of customs duty on imports. They should get ICEGATE login. The AEO should appoint a nodal person for authenticating customs documents. – MF(DR) circular No. 32/2016-Cus dated 26-10-2016.

Liberalised Authorised Economic Operator Package for MSMEs – CBIC has introduced flagship Liberalised Authorised Economic Operator package of MSMEs, vide press release dated 7-1-2021.

In order to attract MSMEs to become Authorised Economic Operators (AEOs) and avail the various benefits, the CBIC has relaxed the compliance criteria provided the MSMEs have a valid certificate from their line-ministry. The relaxed requirements allow MSMEs who have filed minimum 10 Customs clearance documents in one year and who have a clean compliance record over 2 years to apply for the scheme. The documentary requirements have also been appreciably simplified. CBIC commits to take a decision on an application for grant of AEO status within only 15 days from electronic submission of complete documents for AEO Tier T1.

Additional benefits, like further reduction in Bank Guarantee requirements, have been introduced for MSMEs, and will be expanded subsequently.

CBIC’s flagship “Liberalised MSME AEO Package” scheme is a voluntary compliance programme which enables swifter Customs clearance for accredited stakeholders in the global supply chain viz. importers, exporters, logistic service providers, custodians etc.

The approved AEOs derive various benefits such as, inter alia, the facility of Direct Port Delivery (DPD) of imported containers, Direct Port Entry (DPE) of their Export Containers, high level of facilitation in customs clearance of their consignments thereby ensuring shorter cargo release time, exemption from Bank guarantees, priority for refund/rebate/duty Drawback, as well as a Client Relationship Manager at the customs port as a single point of interaction.

Another important benefit available to specified AEOs is that their payment of Customs duty is deferred and need not to be paid before the clearance of the imported goods by Customs.

An added advantage for Tier 2 AEOs is that their exports to certain countries are accorded facilitation by the foreign Customs administration with whom India enters into a Mutual Recognition Agreement/Arrangement.

5. Omnibus Powers to CBIC (Board) to Relax Procedures

Section 143AA of Customs Act, inserted w.e.f. 29-3-2018, gives omnibus powers to CBI&C (Board) to relax procedures for ease of doing business. The section reads as follows:

Notwithstanding anything contained in any other provision of the Customs Act, the Board may, for the purposes of facilitation of trade, take such measures or prescribe separate procedure or documentation for a class of importers or exporters or any other persons or for categories of goods or on the basis of the modes of transport of goods, in order to,— [The words in italics inserted by Finance (No. 2) Act, 2024 w.e.f. 16-8-2024].

• maintain transparency in the import and export documentation; or
• expedite clearance or release of goods entered for import or export; or
• reduce the transaction cost of clearance of importing or exporting goods; or
• maintain balance between customs control and facilitation of legitimate trade.

6. Verification of Identity of a Person Through Aadhaar Number

As per section 99B(1) of Customs Act [inserted w.e.f. 1st August 2019], proper officer, authorised by Principal Commissioner/Commissioner of Customs may require a person to undergo authentication of Aadhaar number and submit other documents as prescribed. If person does not have Aadhaar Number or authentication fails due to technical reasons, alternative mode of verification shall be done. Such authentication may be for ascertaining compliance with provisions of Customs Act or other law in force.

Provisions of section 99B(1) of Customs Act shall not apply to such class of persons as may be prescribed – section 99B(2) of Customs Act [inserted w.e.f. 1st August 2019].

If such authentication is not done, following can be suspended relating to the person:

• clearance of imported goods and export goods
• sanction of refund
• sanction of drawback
• exemption from duty
• license or registration granted under the Act
• any benefit, monetary or otherwise, arising out of import or export section 99B(3) of Customs Act [inserted w.e.f. 1st August 2019]

The order of suspension shall remain in force till authentication is done section 99B(4) of Customs Act [inserted w.e.f. 1st August 2019].

7. Procedure for Verification of Identity and Compliance of Exporter, Importer and Customs Brokers

Under provisions of section 99B of Customs Act, regulations may be called the Customs (Verification of Identity and Compliance) Regulations, 2021 have been issued.

These provisions will apply to Importers, Exporters and Customs Brokers. However, these regulations shall not apply to the Central Government, State Governments and Public Sector Undertakings.

The Jurisdictional Commissioner/Principal Commissioner of Customs may select any person, who may have engaged in import or export activity or availed or claimed the benefits mentioned in section 99B(3)(i) clauses (a) to (f) of the Customs Act or engaged as a Customs Broker in such activity or in availing or claiming such benefits prior to the commencement of these regulations and these regulations shall apply to such person.

Information to person selected for verification of identity – The person selected shall be informed about such selection immediately through the Common Portal, to the extent available, and in other cases, through such means as deemed appropriate by the Jurisdictional Commissioner/Principal Commissioner of Customs.

Verification of identity – The person selected for verification shall furnish the prescribed documents or information on the Common Portal within fifteen days of such intimation of selection. A person who is newly engaging in import or export activity after the commencement of these regulations shall furnish the said documents not later than thirty days of engaging in import or export activity.

Authentication of Aadhaar and PAN – Every individual, karta, managing director, whole time director, partners, member of managing committee of association, board of trustees, authorised representative, authorized signatory, shall, within the prescribed time limit, undergo on the Common Portal:

1. authentication of Aadhaar; and
2. verification of Permanent Account Number.

If the authentication of Aadhaar cannot be completed due to its non-assignment or due to technical reasons, the person to be verified shall furnish a notarised copy of valid passport or electoral photo identity card for verification on Common Portal, within an extended further period of five days from the date of such selection or failure of authentication, as the case may be, or within such extended period, as may be allowed by the Jurisdictional Commissioner/Principal Commissioner of Customs.

Verification by proper officer of customs – On submission of documents or information as above, the proper officer (Deputy Commissioner or Assistant Commissioner subordinate to the Jurisdictional Commissioner/Principal Commissioner of Customs) or an officer authorised by him shall:

1. undertake a physical verification of the address provided in the principal place of business not later than forty five days from the date of submission of the documents
2. evaluate the financial standing of the person.

“Principal place of business” means the primary address specified in the Importer Exporter Code issued by Directorate General of Foreign Trade (DGFT).

Physical verification of premises – The proper officer may, for reasons to be recorded in writing and with the approval of an officer not below the rank of Joint or Additional Commissioner of Customs, in lieu of the physical verification of the place of business, carry out the verification of such documents as he may deem fit. However, where the verification of identity is completed by means other than authentication of Aadhaar, the physical verification shall not be waived.

Result of verification of identity – The outcome of the verification of identity shall be captured in the Customs Automated System and informed to the person verified.

Verification of compliance – Notwithstanding the verification of identity of persons as above, the Jurisdictional Commissioner/Principal Commissioner of Customs, may, with a view to protecting the interest of revenue or preventing smuggling, cause verification of the compliance to the provisions of the Act or any other law for the time being in force, by such person and for this purpose require the person concerned to produce any document or information in the Customs Automated System.

Suspension of benefits – The Jurisdictional Commissioner/Principal Commissioner of Customs may, based on reasons to be recorded on the Customs Automated System, order suspension of any or all of the benefits mentioned in section 99B(3)(i) of the Customs Act and inform such decision to such person. Where the benefits are suspended, the Jurisdictional Commissioner/Principal Commissioner of Customs, shall within a period of fifteen days from the date of such suspension, give an opportunity of being heard to such person whose benefits are suspended and may pass such order as he deems fit, either revoking the suspension or continuing it, as the case may be, within a period of fifteen days from the date of hearing granted to such person.

Restoration of benefits – The benefits suspended shall be restored when the person concerned complies with the requirements or furnishes correct document or information sought thereunder.

Denial of benefits – In case of failure of authentication as required under section 99B(1) of Customs, the Jurisdictional Commissioner/Principal Commissioner of Customs may, after giving opportunity of hearing, by order, direct that such person shall not have the benefit of any of the items specified in section 99B(3)(i) clauses (a) to (f) of the Customs Act.

Appeal against order of Commissioner/Principal Commissioner of Customs – Appeal against order of Commissioner/Principal Commissioner of Customs lies before CESTAT.

Penalty for contravention – The Jurisdictional Commissioner/Principal Commissioner of Customs may impose a penalty not exceeding fifty thousand rupees on a person who contravenes any provision of these regulations or who fails to comply with any provision of these regulations.

8. Turant Customs

‘Turant Customs’ has been introduced w.e.f. 28-2-2019 with the objectives of speedy clearance, transparency in decision making, and ease of doing business. Subsequently, Board rolled out numerous changes to the Customs clearance process, which combine together support Turant Customs. These initiatives include the self-registration of goods by importers, automated clearances of bills of entry, digitisation of customs documents, paperless clearance, etc.

Turant Suvidha Kendra scheme has been introduced.

Facilities available at Turant Suvidha Kendra have been explained in CBI&C circular No. Circular No.32/2020-Cus dated 6-7-2020. Following facilities are available

• Registration of Authorised Dealer Code, Bank Accounts through ICEGATE
• Automated debit of bond after Assessment
• Simplified Registration of Importers/Exporters in ICEGATE.

The scheme has been extended to Delhi and Mumbai w.e.f. 3-8-2020 vide CBIC circular No. 34/2020-Cus dated 30-7-2020.

9. Faceless Assessment of Bill of Entry and Appeals

Faceless Assessment system of Bill of Entry has been introduced vide CBI&C Circular No. 28/2020-Cus dated 5-6-2020. The scheme has been introduced at Chennai and Bengaluru w.e.f. 8-6-2020 for few commodities.

Various customs officers i.e. DC/AC and Superintendent of Customs have been appointed as ‘proper officer’ for faceless assessment of Bill of Entry vide Notification No. 50/2020-Cus. (NT) dated 5-6-2020.

Procedure for faceless assessment of Bill of Entry has been specified in M.F. (D.R.) Instruction No. 9/2020-Cus dated 5-6-2020.

Board has decided to roll out the Faceless Assessment at an All India level in all ports of import and for all imported goods by 31-10-2020. National Assessment Centres (NAC) have been constituted consisting of Principal Commissioner/Commissioner of Customs – CBI&C circular No. 40/2020-Cus dated 4-9-2020.

Further procedural clarifications have been given vide CBI&C circular No. 45/2020-Cus dated 12-10-2020.

To ensure faster clearance, facilitation levels have been enhanced to 90% w.e.f. 15-7-2021. Entity based DPD (Direct Port Delivery) has been changed to Bill of Entry based DPD. Assessment process has been expedited. FAGs have been reorganized. Examination orders are generated automatically. The details are specified in CBIC Circular No. 14/2021-Cus dated 7-7-2021. These have been further elaborated in CBIC Circular No. 16/2022-Cus dated 29-8-2022.

National Assessment Centres and Faceless Assessment Groups – National Assessment Centres and Faceless Assessment Groups have been reorganised vide CBIC Circular No. 13/2023-Cus dated 31-5-2023. There will be 8 NACs, each headed by either Principal Chief Commissioner or Chief Commissioner.

Customs Officers for conducting faceless or remote assessment – Customs Officers for conducting faceless or remote assessment of Bill of Entry have been notified vide Notification No. 27/2022-Cus (NT) dated 31-3-2022.

Anonymized Escalation Mechanism & extension of Standard Examination Orders through RMS (Phase 1, Part 2) – On basis of CBIC Circular No.14/2021-Customs dated 07.07.2021, an initial Anonymized Escalation Mechanism (AEM) was introduced by the Directorate of Systems’ ICEGATE Advisory dated 02.08.2022. The AEM operates after IGM number with date is recorded in bill of entry (i.e. after arrival of goods). Hence, the  Pr. Chief/Chief Commissioners,  in their roles as Zone and/or NAC heads, should ensure that an aspect lodged in the AEM is not allowed to linger and that all successive actions are quickly taken without loss of time – CBIC Circular No. 23/2022-Cus dated 3-11-2022.

Appeal in case of order issued under faceless assessment – Appeal against order issued under faceless assessment will lie before Commissioner of Customs (Appeals) of Bengaluru, Chennai, Delhi, Mumbai-I, Mumbai-II and Mumbai-III assigned to them electronically in Customs Automated System for purposes of sections 17(5) and 18 of Customs Act. Each of these officers [Commissioner of Customs (Appeals)] shall have all India jurisdiction in respect of Bill of Entry entered under for home consumption under section 46(1) or for warehousing under section of Customs Act which are assigned to them electronically by Customs Automated System – Notification No. 92/2017-Cus (NT) dated 28-9-2017 amended on 30-7-2020 and 4-9-2020.