'In FOB contract, seller must bear the charges for loading cargo on vessel'

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We have a contract on FOB basis and the cargo is to be shipped mainly in break bulk mode. The customer (buyer) will arrange the vessel. In a FOB contract and break bulk mode of transport, who is responsible for stevedoring charges — the buyer or seller?

Stevedoring technically means “from the first point in the ship’s or ship’s hold to the first point on the quay or vice versa”. It is therefore the process of loading or discharging/offloading of cargo to/from a ship. In a FOB contract, all the charges relating to the cargo till the goods are placed on board the vessel are to the seller’s account.

 

We have a current account with Bank ‘A’. We received advance payment for exports through ‘A’. We obtained FIRC and submitted it to Bank ‘B’ along with export documents. Now Bank ‘A’ has debited penal charges to our current account for not advising them as to how the payments have been adjusted. Is the bank correct?

Each bank has its schedule of charges. If penal charges are not in the schedule or not specifically agreed, the bank cannot levy it. You can contest the debit and take it up with the bank’s ombudsman or consumer courts. I do not know which bank you are dealing with. You may note that State Bank of India charges Rs 1,000 for receiving advance payment of up to $50,000 and Rs 2,000 for higher amounts. For only lodgment of export bills where full advance is received, SBI charges Rs 500 for bills of up to $50,000 and Rs 1,000 for amounts beyond that. SBI does not levy penal charges for not submitting the export documents or not informing the bank. You may look up SBI schedule of charges here.

 

We had imported capital goods under EPCG issued in June 2017 (before GST). Our machine landed in India in late July 2017 (after GST implementation). So, we had paid full 18 per cent GST. Can we take credit of this IGST? How to adjust it through our local/export sales?

Yes. You can take credit of the IGST paid on imports on the basis of bill of entry and utilise it for payment of IGST/CGST/SGST on your local sales. If you export, you can either utilise the credit to pay IGST on your export goods and claim a refund of that under Rule 96 of the CGST Rules, 2017, or clear the export goods without IGST payment under letter of undertaking and claim refund of the unutilised credit under Rule 89 of the CGST Rules, 2017.

 

From our SEZ unit, we want to clear imported raw material to DTA. Can we file a bill of entry on behalf of and under authorisation from DTA buyer and clear on payment of normal customs duty?

Yes. But, as per first proviso to Rule 47 of SEZ Rules 2006, such DTA sales shall be subject to the provisions of the FTP, as applicable to import of similar goods into India.


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