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  Process for the procurement of the  Trading products.

•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
•With the globalization of Indian economy and consequent upon comfortable balance of payment position Government of India has liberalized the Import Policy and practically all Controls on imports have been lifted.
•Imports in to India are governed by Foreign Trade (Development & Regulation) Act 1992

Goods arrival at the Port



     Important  steps while importing

1.Registration with Regional Licensing Authority is a pre-requisite for import of goods
2.The importer has obtained IEC( Import export code) Code Number from Regional Licensing Authority
3.  The basic customs tariff rate now ranges from 0 to 40% plus additional duty of 2%; the average rate is about 30%.


•Arrival at customs port/airport only
•Import Manifest / Report
•Grant of Entry Inwards by Customs Officer
•Carrier responsible for shortages during unloading
•Bill of entry filing :in quadruplicate – original and duplicate for customs, triplicate for the importer and fourth copy is meant for bank for making remittances.
Documents to be submitted by Importer :Grant of Entry Inwards by Customs Officer  –
2.Packing list
3.Bill of lading
 4.GATT declaration form
 5.Importer/CHA declaration
6.LC or Bank draft
 7.Insurance memo/policy
 8.Certificate of country of Origin
 9. Technical literature
 10. Import license or attested copy when clearance under license
Assessment of Duty and Clearance

The documents submitted by importer are checked and assessed by Customs

authorities and then goods are cleared.


Appraising the goods

Valuation of goods

Approval of Assessment

Payment of Customs Duty

Out of Customs Charge Order

After goods are examined, it is verified that import is not prohibited and after customs duty is paid, Customs Officer will issue ‘Out of Customs Charge’


Demurrage if goods not cleared – Heavy demurrage is payable if goods are not cleared from port within three days.


•The documents submitted by importer are checked and assessed by Customs authorities and then goods are cleared. Section 2(2) defines ‘assessment’ as follows – ‘Assessment’ includes provisional assessment, reassessment and any order of assessment in which the duty assessed is Nil. Thus, ‘assessment’ includes ‘Nil’ assessment.
•Customs Clearance of imported goods

      Customs Authorities and the Clearing agents play the key role in the import of goods. All goods imported into India have to pass through the procedure of Customs clearance as they cross Indian border. The goods are examined, appraised, assessed, evaluated and then allowed to be taken out of charge of the Customs for use by the importer. The entire process of customs clearance is complex and to carry out this procedure smoothly, the help of accredited customs clearing agents has to be taken.

Types of Duties


Basic Duty:
This is the basic duty levied under the Customs Act

Additional Duty (Countervailing Duty) (CVD):

This additional duty is levied under section 3 (1) of the Custom Tariff Act and is equal to excise duty levied on a like product manufactured or produced in India

Anti-dumping Duty:

Sometimes, foreign sellers abroad may export into India goods at prices below the amounts charged by them in their domestic markets in order to capture Indian markets to the detriment of Indian industry

•Special Additional duty

is duty levied under Section 3(5) if the CTA 1975. This is levy in order counter balance various internal taxes like Sales Tax, VAT, etc



We have thus seen that import procurement in India involves multiple steps and procedures taxes and duties
For an ERP consultant it is important to know the process flow so that the scenario can be mapped accurately in the system
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    1. Former Member Post author
      Thanks for your comments Rajat
      For a CIF shipment Via a vis a FOB shipment the change is in the Duty calculation and the Documention .

      For a FOB  shipment the Duty is also calcuated on teh freight Value of the shipment ( This is included in the Total Value of the shipment)


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