New / Amended Provisions under Customs Warehousing Regulations 2016
Pursuant to the enactment of the Finance Bill 2016, Ch IX of the Customs Act, 1962 stands amended. Accordingly, the CBEC has notified amended / new Warehousing Regulations 2016 on 14th May 2016, as under:
Further, bonds required to be obtained from importer under section 59 have been prescribed to replace the bonds earlier prescribed:
The system of physical escorting of goods within the same town has been dispensed for movement of goods from one warehouse to another. Escorting will also not be required for movement of goods from a warehouse to a customs station for export. These movements would be done by affixation of a one-time-lock.
It may be noted that the regulations on licensing of different types of warehouses contain transitional provisions to enable the warehouses to switch over to record based control in a smooth and orderly manner. The provisions require existing licensees to fulfill certain conditions within a period of three months upon which they can migrate to a system of record based controls and the customs lock can be removed.
Section 58A has been enacted to provide for a new category of warehouses (special warehouses). These warehouses shall be entitled to store specific classes of goods, which have been notified under sub-section (2) of section 58A (Notification No.66/16 – Cus (NT) dated 14th May 2016). These warehouses shall be under the lock of customs. An existing licensee or any new applicant shall be required to apply for a license under Special Warehouse Licensing Regulations, 2016, if they propose to store or continue to store goods notified under notification 66 /16-Cus (NT) dated 14th May 2016 namely, goods stored for duty free shops/airline/ship/diplomatic stores. Here again, a transitional period of three months has been provided so as to allow existing arrangements to continue and enable a smooth and orderly transition.
With respect to the amendment carried out to section 64 of the Customs Act, few field formations have raised the issue regarding drawal of samples by regulatory agencies. It is clarified that any regulatory agency can draw a sample while goods are warehoused.It may also be noted that the Warehouse (Custody & Handling of Goods) Regulations, 2016 and Special Warehouse (Custody & Handling of Goods) Regulations, 2016 specifically provide for the warehouse keeper to maintain records of samples drawn by any regulator under any law for the time being in force. However, should the owner of goods require samples for marketing etc., the same are to be cleared on payment of duty by filing an ex-bond bill of entry.
Under sub-section (2) of section 73A, the responsibilities of licensee have been provided in Warehouse (Custody & Handling of Goods) Regulations, 2016 and Special Warehouse (Custody & Handling of Goods) Regulations, 2016. The regulations also provide for computerization of records in respect of warehoused goods. This is a key component based upon which liberalization in respect of warehousing procedures has been carried out. During the course of trade consultations, it was gathered that licensees are at different stages of automation. While some warehouses are already using highly advanced IT systems, others have not computerized their records.Warehouse keepers may be encouraged to acquire I.T. capabilities for inventory management at the earliest.