Customs
House Agent (CHA) is a person who is
licensed to act as an agent for transaction of any business relating to the entry or
departure of conveyances or the import or export of goods at any Customs station.
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Liabilities on a CHA
Section
146 of the Customs Act is the enabling
provision, which allows agents of importers and exporters to act on behalf of importers
and exporters. This is necessitated by the highly involved and technical nature of the
work to be done in connection with clearance of imports into and exports out of country.
The importers and exporters themselves may have neither time nor the requisite knowledge
on their own. Therefore, agents are allowed to act on their behalf. The work of the agents
is governed by the Customs House Agents Licensing Regulations, 1984 framed
under this section read with Section 157.
There are certain liabilities fastened on the agent of the importer or exporter
under Section 147. Some of these liabilities are in
the nature of extension of and exceptions to the liability of an agent under the Indian Contracts Act, 1872. Sub-section (1) empowers the
agent to do everything that an importer or an exporter can do. Filing a bill of entry,
shipping bill, submitting supporting documents therewith, helping in examination of goods,
payment of duty on behalf of the principal, warehousing of goods, removal from warehouse
and the like. The common law principle that an agent’s actions bind the principal is
given the status of a legal presumption. The consequences of all actions of a CHA will
bind the importers and exporters on whose behalf they act. An agent who is authorized to
act on behalf of the importer or exporter is treated as the owner of imported or exports
goods. In respect of that particular transaction, a notice could be given to that agent.
This does not normally extend to recovery of duty not paid or short paid by the owner,
importer or exporter of goods. As an exception, this is permissible when the
Deputy/Assistant Commissioner is of the opinion that such recovery from the owner,
importer or exporter of goods is not possible.
1.
No ceiling for number of CHAs who can be appointed in a Customs House.
2. Issue of regular licence is preceded by a period of grant of temporary licence.
3. Prescribing criteria of experience and financial soundness for appointment.
4. Grant of regular licence is subject to passing examination, satisfying minimum
volume
of business and complying with obligations under Regulation No.14.
5. Change in the constitution of partnership or firm not to affect the operations
of CHA.
6. Commissioners have been empowered to prescribe fees to prevent excess billing by
the CHAs.
Under Regulation 4, every January, the Commissioner of Customs has
to notify and advertise and call for applications from persons for acting as CHAs within
his jurisdiction. Individuals, firms and companies can act as CHAs. In case of firms and
companies, the application has to give the particulars of partner or director who will
actually do the work of clearance of goods at the Customs station. Application is made in
Form A.
Applications
made by the firms or companies should contain full details of the directors or partners.
Qualifications of an applicant
The applicant
individual working for a firm or a company should be:
-
A graduate from a
recognized University.
-
Should hold a pass
in Form G as employee of the firm / company.
-
Should have engaged
in Customs clearance work for three years.
-
Should possess
assets of Rs.1 lakhs or Rs.50,000/- as certified by a scheduled bank.
-
Reliability of the
applicant and soundness of financial status are very important criteria.
-
If there are too
many applicants than the licenses that can be granted, the Commissioner has to select
persons for licensing by seniority of holding G pass. If there are two persons of same
seniority, the older person will be preferred [Regulation 8(3)].
Relaxations, which can be granted by the Commissioner:
An applicant need to
possess pass in Form G for one year only if permitted by the Commissioner for reasons to
be recorded in writing.
DEPARTMENTAL
CLARIFICATIONS
Qualification
Various Custom Houses
and Commissionerate prescribe certain volume of business as qualification for considering
application for regular licences:
1. 150
documents per year (for ex: shipping bill or bill of entry)
2. Clearance
or shipment 1500 packages per year.
3. Clearance
or shipment of packages of value not less than Rs.60 lakhs.
A G-Pass holder with one year
experience may also appear for examination if permitted by the Commissioner for reasons to
be recorded in writing.
1. Diploma in
“Customs clearance and freight forwarding” offered by Bombay University is not
considered as graduation for the purpose of eligibility.
2. An employee or partner or director of a CHA licensee authorized to take
examination under Regulation 9(5) is allowed to take three examinations in a period of two
years from the date of application by the licensee for examination.
3. Level of knowledge of local language has to be determined by the Commissioners
as the Regulations do not prescribe any requirement. Knowledge of local language by the
authorized representative is considered sufficient.
4. A person who passes examination under Regulation 9(5) can apply for independent
CHA licence when applications are called for, subject to possessing other qualifications.
5. Persons who were granted CHA licence before the amendment of 1997 prescribing
graduation as qualification would continue to qualify for renewal of licence.
Multimodal
transport operators (MTOs) are appointed under Multimodal Goods Transportation Act, 1993
by the Ministry of Surface Transport. Their work involves carriage of goods by more than
one mode of transport between India and any place abroad. They handle export cargo
stuffing and destuffing. This does not automatically confer any right on them to obtain
appointment as steamer agents or CHAs unless thy are otherwise qualified for such
appointment. Their role is different from that of a CHA or a steamer agent.
Temporary
licence
After
scrutinizing and accepting the application a temporary licence for a period of one year is
granted under Regulation 8 in Form B.
Before receiving
the temporary or regular licence, the applicant has to go through another important step. He is required to execute a bond and give a surety
or bank guarantee in Forms D and E. For major ports , the surety amount is Rs.25000/- For other ports, it is Rs.10000/- Surety may also
be given in the form of National Savings Certificates or postal security. In the last two
forms of surety, these should be pledged in the name of the Commissioner. It is important
to note that since a regular licence holder is allowed to work in more than one Customs
station, separate bond and surety have to be given in respect of each Customs station.
Curriculum
[Regulation
9(3)]
1. Preparation
of various kinds of bill of entry and shipping bill.
2. arrival
entry and clearance of vessels.
3. Tariff
classification and rates of duty.
4. Determination
of value for assessment.
5. Conversion
of currency.
6. Nature
and description of documents to be filed with various kinds of bills of entry and shipping
bill.
7. Procedures
for assessment and payment of duty.
8. Examination
of merchandise at the Customs stations.
9. Provisions
of the Trade and Merchandise Marks Act,1958.
10. Prohibitions on imports
and exports.
11. Bonding procedure and
clearance from bond.
12. Re-importation and
conditions for free re-entry.
13. Drawback.
14. Offences under the Act.
15. Provisions of allied
Acts including Customs Tariff Act,1975, Foreign Trade (Development and Regulation) Act,
1992,Foreign Exchange Regulation Act,1973, Indian Explosives Act,1884, Arms Act,1959,
Opium Act, 1878, Drugs and Cosmetics Act,1940, Destructive Insects and Pests Acts, 1914,
Dangerous Drugs Act, 1930 insofar as they relate to the clearance of the goods through
Customs.
16. Refund procedures,
appeals and revision petitions.
Although not a part of
curriculum, the Commissioner has to satisfy himself that the applicant-candidate has good
knowledge of English and local language of Customs station. For a person working
exclusively in docks, knowledge of English is not compulsory. But, knowledge of Hindi will
be considered as advantageous. [Regulation 9(4)].
Examinations
Regulation 8 itself
refers to two opportunities to a temporary licence holder for writing and passing the
examinations. A third opportunity may be given by the Commissioner if the temporary
licence holder has met with the minimum work criteria (number of package, value, tonnage,
Duty amount etc). This extension of time is granted for minimum six months and maximum one
year.
If this extension of
time is refused by the Commissioner, a representation can be made to the Chief
Commissioner.
The candidate will
have three opportunities to pass the examination within two years. One may take
examinations as soon as temporary licence is granted. The examination fee is Rs.500/-per
appearance.
There will be
two examinations each year. There will be both oral and written examinations. A person who
passes written examination but fails in oral examination is treated as failed. But, he
need not write examination again.
The reference
to applicant or candidate or temporary licence holder or regular licence holder must be
correctly understood. Where the applicant is an individual, it is the same person who
holds the temporary licence and also writes the examination. On the other hand, if the
applicant is a firm or company, the person who writes the examination is an employee of
the firm or company. But the temporary or regular licence may be issued in the name of the
firm or company. This position is clear from Regulations 5 and 6.
Regulation 9(5)
allows a CHA to permit one of the employees, or partners or directors to appear in the
examination conducted under Regulation 9. This would be in addition to the person already
present and who has passed this examination. The person so permitted to appear for
examination must be a graduate. But, he need not be a G pass holder or have experience in
the capacity of a G pass holder.
An application
for regular licence can be made by a person who has passed the examinations. Application
for regular licence is made in Form C. Form A and Form C are almost identical except that
while the first form is issued under Regulation 5, the latter form is issued under
Regulation10. Licence fee is Rs.5000/-. Regular licence is granted in Form D. The
applicant for regular licence has to satisfy following conditions:
A. The
applicant must satisfy the norms regarding quantity or value of cargo cleared form the
Custom House. This is
determined by the Commissioner.
B. The
conduct of the applicant during the period of holding temporary licence must be business
like. There should be no delay in clearance of goods or in payment of duty on account of
conduct of the applicant. There should be no complaint of misconduct of the applicant.
There also should not be any complaint of non-compliance of provision of Regulation 14,
which casts some important obligations on the CHAs.
Disqualifications
for regular licence
Regulation 10(1)
specifies that only a person who qualifies in the examination can apply for a regular
licence, Nevertheless, sub-regulation (3) provides that the Commissioner may reject the
application of a person who fails to qualify in the examination, It further provides that
if performance criteria is not satisfied
(regarding quantity and value of clearances or conduct), the application may be rejected.
A representation can be made against an order of rejection within 30 days to Chief
Commissioner. The Chief Commissioner is also empowered to review the procedure of grant of
regular licence within one year.
Regular
licence granted to a person cannot be transferred [Regulation 13].
Validity
of licence
Under Regualtion12
(1), the validity of licence is for a period of five years.
Extension of licence
An applicant seeking
revalidation or extension of licence has to apply before the validity expires, to the
Commissioner. It will be renewed for a period of five years either from the date of
expiration of licence or from the date of last renewal of licence, A CHA seeking renewal
has to satisfy the Commissioner that he has conformed to the norms fixed by the
Commissioner regarding minimum quantity and value of cargo clearance and that he is not
guilty of misconduct or that he has not been the cause of delayed clearance of goods or
delayed payment of duty. There should also be no complaint that he has violated the
obligations cast on him under Regulation 14 read with Regulation 12.
The renewal fee
payable is Rs.3000/-[Regulation 12(3)]
A person who has passed examination can act on behalf of another firm or company
which is holding a regular licence. But, at any time, he can act for only one such firm or
company.
A CHA who has
been granted licence cannot acquire a right to obtain office accommodation in the Custom
House [Regulation 24].
Working in other
Customs Stations
A person holding regular licence can work in all Customs stations as a CHA. If a
place has both sea port and international air port, there is no need to seek the facility
of separate licence from each place. Otherwise, for this purpose a separate
application has to be made to the concerned Commissioner of Customs. The applicant
should satisfy the commissioner that he has the financial soundness as prescribed under
Regulation 6 [see under "Qualifications of applicant", above]. Such an
applicant has to satisfy the Commissioner that he has sufficient clients, that he can
provide warehousing and transport facilities. Separate bond and bank guarantee
should be given as in given to his regular Customs station, in Forms D and E.
DEPARTMENTAL
CLARIFICATION
Regular licensees working in other Custom Houses
In terms of the
Regulations, a person who is regular licence holder and intends to work in another Custom
House will be eligible to obtain a regular licence at any other Customs station from the
concerned Commissioner subject to his fulfilling the requirements specified in
Regulation10 (2). There is no requirement under this sub-regulation that an employee
qualified under Regulation 9 should be available at branch office of the licencee where he
intends to obtain regular licence under Regulation 10(2).
A CHA licence may be
suspended or revoked within the jurisdiction of Commissioner if there is failure of
condition of bond executed by the CHA. Misconduct on the part of CHA or failure to comply
with regulations will also result in suspension or revocation of licence. Suspension may
be ordered in cases requiring immediate action, pending enquiry. [Regulation 21].
Procedure for suspension/revocation of licence
The Commissioner of Customs has to issue a show cause notice to the delinquent CHA
and give him forty-five days time to reply to it. The reply has to made to an
Deputy/Assistant Commissioner nominated by the Commissioner for this purpose. The reply
should state whether a personal hearing is desired.
The
Deputy/Assistant Commissioner has to conduct inquiry into grounds which are not admitted
by the CHA in his reply. For this purpose, both oral and documentary evidence may be taken
by him. He may question any person for ascertaining the correct position. The CHA can
cross-examine the departmental witness. If opportunity of cross-examination is denied, the
Deputy/Assistant Commissioner has to record his reasons for doing so. At the end of
proceedings, the Deputy/Assistant Commissioner will submit a report to the Commissioner.
The Commissioner has to serve a copy on the delinquent CHA requiring him to make
representation against that report, within atleast 60 days. The Commissioner has to pass
an order after considering the report and the representation.
Appeal against
Commissioner’s order
Regulation 23(8)
provides an appellate remedy against the above order to the CEGAT. A CHA aggrieved by the order of the
Commissioner can appeal to the Tribunal. Though the regulations do not so provide, it may
be noted that the provisions of Sections 129A to 130 of Customs Act, 1962, would apply to
an appeal filed under this sub-regulation.
Employment of Persons
A CHA may
employ one or more persons for assisting him in his work as CHA. The appointed person
should have atleast passed X standard examination. The appointment of a person has to be
approved by the Deputy/Assistant Commissioner designated for this purposes by the
Commissioner. The antecedents of the person and his character are considered before
granting approval. A new appointee has to pass an examination within six months which is
conducted by a committee of Customs officers, for ensuring that the appointee has adequate
working knowledge of the provisions of statutes. Upon failure of the candidate, the
Deputy/Assistant Commissioner may grant permission for another appearance. Maximum four
such permissions can be granted.
A person who has passed this examination while working under a CHA will not be
required to appear for examination when he works for another CHA.
If a CHA
authorizes his employee to sign documents, he must file a letter approving such
authorization with the Deputy/Assistant Commissioner. If there is any change in the
authorization, it should also be communicated in writing to the Deputy/Assistant
Commissioner.
The CHA will be
responsible for the conduct of his employees and acts of omissions and commissions by
them.
Identity
cards in Form G
All
employees of CHAs are given identity cards in Form G after passing the examination. Till
he passes examination, the identity card will be in Form H. At all times during work at
Customs station, the person should carry his identity card and produce it on demand.
[Regulation 20].
Departmental
clarification
Person with
experience in Customs Clearance who do not possess minimum qualification of passing 10th
standard examination will not be considered for issuing G pass. However, persons who were
given such G pass before introduction of minimum educational qualification in 1997 would
continue to be eligible for renewal of such pass.
Service charges
Every CHA
has to enroll himself as a member of a CHA association registered with the Custom House
and recognized by the Commissioner. Regulation 25 confers power on the Commissioner to fix
rates which may be charged to the client for services rendered by the CHA. This is done in
consultation with a recognized association of CHAs. The CHAs are required to strictly
adhere to these rates.
Schedule
of rates
IMPORT
1 |
Bill of Entry |
Rs.50/- per Bill of Entry of one page per set.
Rs.40/- for each subsequent page |
2
(a) |
Agency charges for all commodities except documents |
(a) Rs.8/- per PKg with minimum Rs.250/- per consignment in case of import
of dry fruits.
(b) 1 to 25% of CIF value depending upon commodity upto first 10 lacs and
0.75% for balance value over Rs.10 lacs subject to a minimum of Rs.750/- per Bill of
Entry.
(c) Rs.1500/- per container load of 20’ and Rs.2000/- for 40’
container. |
(b) |
Documents other than books, periodicals and magazines |
Rs.400/- to 600/- per Bill of entry depending upon value & size of the
consignment. |
3 |
Charges for Customs Examination including Opening and Sealing of packages |
Actuals |
4 |
Completion of Octroi formalities at ICD/ CFS or at cargo terminal |
Rs.50/- per form. |
5 |
Survey attendance (excluding) actual expenses |
Rs.75/- per survey |
6 |
Survey expenses |
Actuals |
7 |
Drug Control formalities conveyance to Drug Controller and expenses for
making extra trips |
Rs.40/- per Bill of Entry |
8 |
Licence release order |
Rs.100/- per Release Order |
9 |
Charges for obtaining SLC/NDC and other certificates |
Rs.50/- per certificate |
10 |
Bond formalities |
Rs.150/- |
11 |
DEEC formalities |
Rs.250/- per Bill of Entry |
12 |
Direct delivery of containers at premises of the importer |
Rs.400/- per TEU outside |
|
EXPORT |
1 |
Shipping Bill |
Rs.50/- per Shipping Bill |
2 |
Agency charges |
(a) Rs.8/- per Pkg. Except fresh vegetable.
(b) Rs.6/- per Pkg. In case of Fresh Ginger and Pan
(c) Rs.500/- per wagon for capacity upto 20 M.Ton & beyond that Rs.650
per wagon.
(d) Rs.1500/- per container 20’
Rs.2000/-
per container 40’ |
|
(b) Air freight |
Rs.250/- per consignment |
3 |
Bill of lading, stamp & preparation (upto 15 copies) |
Rs.35/- per bill of lading |
4 |
Charges for customs examination including opening and sealing of packages |
Actuals |
5 |
Completion of formalities of Octroi |
Rs.50/- per form |
6 |
Amendment of Shipping Bill |
Rs.20/- Customs fee on actual basis |
7 |
Staff overtime for examination/ shipment during second & third shift |
Actuals |
8 |
DEEC formalities |
Rs.250/- per shipping bill |
(i) |
Customs Drawback Claims/Insurance Steamer and Airlines
Agents/IAAI/ Rly. CWC/Octroi |
7.5% of the amount realized per claim |
(ii) |
Charges for filing of cash claim |
Rs.100/- per claim |
(a) |
For obtaining the duplicate copies of documents |
Rs.250/- |
IMPORT
AND EXPORT
Customs duty redemption fine; penalties, AAI, Railway, CWC charges Sea &
Air Freight, overtime, general averages bonding and debonding, expenses for escorting Bond
Cargo sundries loading, conveyance and transport charges, fork lift charges, packing and
lashing expenses, telephone, telegram, postage and telex charges, Xerox expenses, cost of
stamp paper, special adhesive stamps, Bill of lading issuing expenses, GSP fee, Chamber of
Commerce Fee, AEPC, Export inspection agency expenses, container rent, container movement
expenses, stuffing and destuffing charges, any other charges, payable to steamer detention
charges, truck detention charges, all statutory demurrage charges, shipment and delivery
expenses, adjudication formalities, amendment expenses, unforeseen expenses, and all
reimbursable expenses, etc.
The above-said charges will be collected from Importers & Exporters on actual
basis. It is further directed that a certificate from a Chartered Accountant certifying
that the rates charged by the CHA are strictly in accordance with the rates prescribed
should be furnished at the time of renewal/extension/regularization of CHA Licence.
Records
to be maintained by the CHA
CHAs have to
maintain detailed, itemized and upto date books of accounts. The accounts should reflect
all financial transactions entered into as a CHA. A copy of all documents such as shipping
bill, bill of entry, transhipment application etc. filed must be maintained by the CHA for
atleast five years. These records should be made available for inspection by the officers
of the department.
Duties
and Obligations of a CHA
Clearances
only against authorization
A CHA is
required to clear goods for import or export only against specific authorization from the
principal and must produce it whenever required by the Deputy/Assistant Commissioner.
Method of
transacting business
The CHA has
to either personally clear the goods or clear it through an employee who is approved by
the Deputy/Assistant Commissioner who is designated for this purpose by the Commissioner.
All the documents prepared by him should prominently bear the CHAs name at the top of the
document. The CHA should not attempt to influence the conduct of Customs officers in
matters pending before him or his subordinates. There should be no threats, false
accusations or duress against such officers. No promise of advantage or benefit or gift
should be made or bestowed on such officers. Duty of CHA should be discharged with utmost
speed and avoid delays. He cannot charge for his services in excess of rates approved by
the Commissioner.
Personal
interests of CHA
If the CHA
is a former officer of the department, he cannot represent any matter before a Customs
officer, which he had personally considered as such officer. He cannot also use facts
which came to his knowledge when he was an officer.
Duty to
tender correct advise
The CHA is
duty-bound to advise the client to comply with the provisions of the Act and the
regulations. If there is non-compliance of provisions by any client, he is required to
bring it to the knowledge of the Deputy/Assistant Commissioner. This regulation requires
the CHAs to act as source of information to the department.
The CHA has to
exercise diligence and ensure that he passes on correct information to the client, ensure
that all information relevant for clearance or cargo or baggage is passed on to the client
if it is relevant for clearance of cargo or baggage.
Accounting
for money received
The CHA has a
duty to promptly pay to Government all money received from client for payment of duties
and taxes. Similarly, any money received by him from the client or from the Government
should be promptly and fully accounted to the client.
Liability as
to information
CHA should not
attempt to gather information from Government records if it is not granted by the proper
officer. Access to record maintained by him should not be denied, nor removed or concealed
when sought by the Commissioner. There is a duty to maintain records and accounts as
directed by the Deputy/Assistant Commissioner and produce them before that officer for
inspection. All documents have to be prepared strictly in accordance with the rules and
orders.
If the licence granted to a CHA is lost, it should be promptly reported to the
Commissioner.
If there is
failure in complying with obligations under Regulation 14, the Commissioner may prohibit a
person from acting as a CHA within his jurisdiction.
Change
in constitution of firms, companies, concerns
Any change in
the partners or directors should be informed to the Commissioner [Regulation 15].
If there is any
change in the constitution of the firm or company, an application for grant of temporary
and regular licence should be made within 30 days of such change. If there is nothing
adverse against the firm or company, the Commissioner will grant licence of the category
held by the firm or company earlier. In the meantime, the concern may be allowed to
continue its business as a CHA if an application to that effect is made to the
Commissioner.
If the concern
is not a firm or company, in case of any change in the constitution of the concern,
permission will be granted to continue the business as CHA by the Commissioner, If the
change occurs due to death of person who was licenced to act as a CHA, his legal heir who
was assisting him in his work as CHA under Regulation 20 may be granted licence if there
is nothing adverse against that person and he also passes the examination.
If there is any change of qualified person acting on behalf of the firm or company,
such information should be immediately given to the Deputy/Assistant Commissioner. |
