Shifting to new container e-sealing system in a hurry may hurt trade

The Central Board of Excise and Customs (CBEC) has revised its instructions on electronic sealing (e-sealing) of containers by exporters under self-sealing procedures. The new procedures will come into force from October 1.

The CBEC had issued a circular (no. 26/2017-Cus dated July 1, 2017) doing away with the procedure of sealing of containers by the jurisdictional excise/Customs officers from September 1. It had given exporters, who have the status of export house or registration under the goods and services tax (GST) laws, the option of self-sealing of containers. Alternately, the export goods could be brought to inland container stations (ICD) or container freight stations (CFS) for stuffing and sealing the containers. For self-sealing, exporters were required to obtain permission from the jurisdictional Commissioner or Principal Commissioner of Customs. That circular is now amended through a circular (no.  36/2017-Cus dated August 28, 2017).

Under the new procedures, exporters, who have permission for self-sealing from the Customs authorities at the ports, need not to obtain fresh permission from jurisdictional Customs authorities. They will be automatically entitled for the self-sealing facility under the new procedures. The permission to self-seal the export goods from a particular premises will not be withdrawn unless any non-compliance is noticed. In case the premises changes, a fresh permission from the jurisdictional authorities will be required.

The exporters should seal the container with tamper-proof e-seal of standard specifications. It should have a unique number, which should be declared in the shipping bill. Before sealing the container, exporters must feed data such as their name, importer exporter code (IEC), e-seal number, date and time of sealing, shipping bill number and date, destination customs station, container number and trailer-track number. 

This information need not be in the electronic seal but tagged to the seal using a web/mobile application to be provided by the vendor of RFID (radio frequency identification) seals. The serial number of the e-seal must be declared at the time of filing the online integrated shipping bill or in case of manual shipping bill, before the container is despatched to the  to the designated ICD/CFS.

The CBEC says the exporters should directly procure the e-seals from vendors confirming to the standards specified in the circular. The new procedures seeks to enhance integrity of transportation of goods and so, the exporters should give vendors the details such as IEC at the time of purchase as well as for using the standard web application necessary to support the RFID self-sealing eco-system. The circular prescribes various disciplines for vendors, exporters and Customs officers. 

As usual, the CBEC had issued half-baked instructions in July that made many exporters unnecessarily run to their jurisdictional authorities for getting self-sealing permission before August-end. After wasting enough of their time, it has now said that no such permission will be required for those already having the permission from the Customs at the ports giving much relief to harried exporters.  The latest circular clarifies many points and pushes exporters towards a better hi-tech system. 

However, the CBEC should allow sufficient time for RFID vendors to reach out to exporters and train them. The present procedures should continue till the CBEC has enough evidence that most exporters have got familiar with the new procedures.

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel