CBIC Clarifications on Procedure
for E-commerce Exports thru Post and Personal Imports
·
New Regulations come into effect from 21st
June 2018.
·
Absence of EDI system at FPOs, the Postal
Bill of Export (PBE-I) for e-commerce exports will be processed in manual
environment for the time being.
·
Para 9.17A of the Foreign Trade Policy
2015-20, prescribed a procedure for
e-commerce exports under MEIS. Presently, the facility extends to the
Foreign Post Offices at Delhi, Mumbai and Chennai. Exports under MEIS through
Post will continue to be governed through the aforesaid circular, except that
the declaration form appended to thereto shall now be replaced with PBE-1,
which has been prescribed under the new Regulations.
·
Exports under e-commerce, not involving
MEIS, may be done through any notified Foreign Post Office.
·
Any exporter holding a valid Import-Export
Code shall be permitted to export goods by filing a Postal Bill of Export (PBE)
in the form prescribed under the “Export by Post Regulations 2018”.
·
It is clarified that Customs will not be
onboarding the web application for conducting any regulatory process. All
customs procedures will remain in manual mode, till introduction of EDI at FPOs.
·
In case of natural persons (i.e. other
than firms & companies) exporting parcels, there is no change in procedure
being followed hitherto. It is clarified that they will not be required to file
any PBE.
·
Chapter heading 9804 was amended to cover
all types of personal imports, whether by post, courier, air or sea.
Note 4 to chapter 98 was also amended to exclude from heading 9804, motor
vehicles, alcoholic beverages and tobacco products.
·
DGFT has removed the value cap of Rs 2000.00 w.r.t to personal imports, as well as, fully
aligned the chapter notes in ITCHS with those enacted under Chapter 98 of the
Customs Tariff.
·
An IEC code becomes necessary, such as for
filing a Bill of Entry.
·
Imports by post are concerned, it is
recognized that Posts is a unique eco-system of clearance in comparison with
other modes of clearance of imported goods.
·
It may be noted that under notification
50/2017 – Cus dated 1.7.2017 (Sl. No. 608A) bonafide gifts up to a CIF value of Rs 5000=00 (Rs. Five Thousand
only) intended for personal use have been exempted from duty.
·
Imports by a legal person (firms,
companies, other forms of business entities) or which are for trade,
manufacture or agriculture, cannot be regarded as personal imports and shall
not fall within CTH 9804. Such imports by post shall be classified as per Customs
Tariff and shall require an IEC, except as provided under para 2.07 of the HBoP 2015-20.
·
Imports by legal persons or imports connected
with trade or manufacture or agriculture would require that the importer
file a bill of entry at a jurisdictional customs station with EDI facility for
payment of duties provided that the CIF value exceeds Rs
1000 (Rupees One Thousand only) [notification 50/2017 Sl. No: 610 refers]. It
may also be noted that import of commercial samples under notification
154/94-Cus dated 13.7.1994, as amended, warrants filing a Bill of Entry as it
is limited to IEC holders and subject to various other conditions including
value limits.
[CBIC Circular No. 14/2018-Customs dated 4 June 2018]
Subject:
Procedure for e-commerce exports through Post and clarification on personal
imports.
In order to facilitate
exports and specifically give a fillip to the global outreach of India’s
exporters via e-commerce (more so to the small & medium enterprises), all
IEC holders have been permitted to export goods through FPOs. Any IEC holder
exporting goods through the FPO, will be eligible for zero rating of exports,
by way of IGST refund or discharge of LUT. Those who do not wish to avail this
facility or fall in the category of Exempted/Non-Taxable are also permitted to
export under the same procedure. In order to cater to e-commerce exports
through post, the Board has prescribed the declaration forms under “Exports by
Post Regulations, 2018”.
2. In absence of EDI system at
FPOs, the Postal Bill of Export (PBE-I) for e-commerce exports will be
processed in manual environment for the time being. However, for the purpose of
GST, data will be captured and uploaded through an off-line utility (ICAN)
provided by DG (Systems). It is clarified that till such time that computers
with ICAN facility are installed and operationalised,
exporters will be free to follow the procedure contained herein.
3. Vide circular 36/2016 –
Customs dated 29th July 2016, the Board had in pursuance to para 9.17A
of the Foreign Trade Policy 2015-20, prescribed a procedure for e-commerce exports under MEIS. Presently, the
facility extends to the Foreign Post Offices at Delhi, Mumbai and Chennai.
Exports under MEIS through Post will continue to be governed through the
aforesaid circular, except that the declaration form appended to thereto shall
now be replaced with PBE-1, which has been prescribed under the new
Regulations. It is further provided that exports under e-commerce, not involving
MEIS, may be done through any notified Foreign Post Office under the
following procedure:
4. Any exporter holding a
valid Import-Export Code shall be permitted to export goods by filing a Postal
Bill of Export (PBE) in the form prescribed under the “Export by Post
Regulations 2018”.
4.1 Every PBE-I (for e-commerce
exports) shall be filed in duplicate and shall cover only one consignor, though
it can be used for any number of consignees. In other words, there will be no
limit on the number of postal shipments which can be effected using a single
Postal Bill of Export - I. The exporter shall be required to attach the
invoice(s) with the PBE. In addition, the exporter shall continue filing of the
postal label or declaration as per CN22/CN23 (Forms attached). An important
ingredient of the revised CN 22/ CN23 forms is that a column for “sale of
goods” has been added.
4.2 The PBE along with goods
shall be presented to the Customs at the Foreign Post Office. In case of
constraints of space or other logistics issues, the jurisdictional commissioner
in consultation with the jurisdictional PMG, may also notify any other
designated Post Office for presentation of export goods, through a public
notice. The PBE shall be processed manually. Upon completion of processing of
the PBE by Customs, the goods shall be presented to the Postal department, who
will acknowledge receipt of the shipment on the PBE and affix the tracking
number of each shipment on the same. Upon affixation of the tracking number by
postal authorities, the PBE shall be brought back to the Proper Officer for
grant of “Let Export Order”. The original PBE will be retained by Customs and
the duplicate PBE will be handed over to the exporter or his customs broker.
4.3 In the case of exports, not
involving e-commerce, the PBE-II shall be filed in duplicate and shall cover
only one consignor and one consignee though multiple packages between a given
consignor and a given consignee can be covered in the same PBE. The procedure
as above will be followed.
4.4 Commissionerates are advised to make
suitable arrangements for noting and processing of PBEs. All extant
instructions relating to examination & assessment applicable to shipping
bills will continue to apply. Chief Commissioners / Commissioners are requested
to evolve guidance for officers for manual risk management.
4.5 The Postal Authorities will
furnish the proof of export of the goods i.e. copy of relevant CN / CP forms,
as applicable to different categories of postal mails, to the Customs at the
FPO. Essentially, the document must contain the tracking nos. of the parcel
along with dispatch identifier. A corresponding entry relating to proof of
export will be made in noting register. Only after receipt of such proof of
export should details in ICAN be uploaded.
5. During the course of
deliberations in the Customs & India Post Joint Conference on facilitating
exports through e-commerce (held on 11th May 2018), the issue of off-line
data entry, increase in exports through post and ensuing shortage of staff was
discussed. Ways & means were discussed for providing best possible
convenience to exporters w.r.t. logistics requirements
of a small parcel environment alongside of following manual customs procedures.
After due consideration of the deliberations, the Board has permitted Customs
Brokers (CBs) to operate at all FPOs for the ease of operations of exporters.
It is also decided that in order to ensure transparency and visibility, CBs
will be required to onboard any third-party web application before commencing
operations at the FPO.
5.1 The web-application shall
have the following functionalities:
(a) The IEC holders and Customs brokers using
FPOs for exports should be registered on the application with KYC documents;
(b)
The e-commerce exporter would input
data required in the PBE (with multiple consignees) on the web-application;
(c)
The application shall provide the
facility of printing the Postal Bill of Export (PBE-1) from the web
application, and the Customs Broker shall file the same at the FPO as per
manual procedure; (d) The web-application shall also provide the facility of
uploading postal tracking numbers by the Customs Brokers;
(e)
The application should provide
dashboards to the exporters and customs brokers w.r.t
to their shipments;
(f)
Customs at the FPO shall have log in
facility to view data with respect to a FPO or a Customs Broker or any exporter
for the purpose of data analysis and profiling for risk management; and
(g)
The application will provide the
facility to customs officer to verify the data and download into a locally
installed PC;
5.2 It is clarified that
Customs will not be onboarding the web application for conducting any
regulatory process. All customs procedures will remain in manual mode, till
introduction of EDI at FPOs. The application will be essentially used between
the exporter and customs broker to facilitate communication, enable shipment
visibility and printing of PBE or any such other value-added services for B2B
use.
6. In the case of natural
persons (i.e. other than firms & companies) exporting parcels, there is no
change in procedure being followed hitherto. It is clarified that they will not
be required to file any PBE.
6.1 In the case of export of jewellery as provided under para 4.48 of the FTP (2015-20),
as amended upto 5.12.2017, extant procedures shall
continue to be followed.
7. In the budget of 2017,
chapter heading 9804 was amended to cover all types of personal imports,
whether by post, courier, air or sea. Note 4 to chapter 98 was also amended to
exclude from heading 9804, motor vehicles, alcoholic beverages and tobacco
products.
8. Also, the Foreign Trade
Amendment Order, 2017 dated 25.07.2017 has amended clause 3(1) (i) of the Foreign Trade (Exemption from application of
rules in certain cases) Order, 1993, and now reads as under:
3. Exemption from the application
of rules. -
(1) Nothing contained in
the Rules shall apply to the import of any goods, (i)
by any person through the post or otherwise for his personal use subject
to compliance of other Laws/Rules/ Orders/Regulations in force.
9. By issue of notification
16/2015-20 dated 12th July
2017, DGFT has removed the value cap of Rs 2000.00
w.r.t to personal imports, as well as, fully aligned the chapter notes in ITCHS
with those enacted under Chapter 98 of the Customs Tariff. Personal imports
would be considered as “free”, except those items which are appearing in the
list of “restricted” items or “prohibited” items or where they are regulated by
any other law for the time being in force, subject to a de-minimus
clause or a clause for personal imports provided in such law. (As regards
definitions of the words “restricted” and “prohibited”, chapter 9 of the
Foreign Trade Policy 2015-20 may be referred)
9.1 The net effect of all the
above changes is that any personal import, whether by courier or post or by Air
or Sea shall be classified under tariff heading 9804 of the Customs Tariff.
9.2 In this connection,
clarification has been sought as to what constitutes personal import? Customs
Act, 1962 does not define personal import. However, the Handbook of Procedures
carries a definition of personal imports in para 2.07 (a) (iii), which is as
follows:
Persons importing or exporting
goods for personal use not connected with trade or manufacture or agriculture.
9.3 Further, where an IEC code
becomes necessary, such as for filing a Bill of Entry, the HBoP
provides for using a default code (0100000053) for:
Persons / Institutions /
Hospitals importing or exporting goods for personal use, not connected with
trade or manufacture or Agriculture.
9.4 Accordingly, field formations
are advised to rely upon the above definitions for the purposes of determining
whether an import falls within the chapter heading 9804.
10. In so far as imports by post are
concerned, it is recognized that Posts is a unique eco-system of clearance in
comparison with other modes of clearance of imported goods. Unlike other eco-
systems, imports by post are both trackable as well as non-trackable.
Manifests, as available in other eco-systems, containing details of
consignor/consignee, their addresses and value/description of goods are not
being captured or exchanged universally between postal authorities. Data
exchange between postal authorities, globally, is at very nascent stages /
pilot stages. India Post is still in the process of joining data exchange
systems, such as UPU-WCO’s SECUREX and other systems which are being worked out
bi-laterally with some other countries. In other words, the basic pre-
requisite of release of goods, namely, filing of declaration and deposit of
duty, cannot be provided with any consistence in the current postal
environment.
11. Keeping the above in view, chapter XI of
the Customs Act was amended by deleting section 82, while section 84 was
amended to provide for issue of regulations to provide a form and manner for making
entry in respect of imports and exports by post. However, compliance to a
system for filing of declaration for personal imports requires a robust
electronic communication system between an importer and Customs/Post. Such a
system requires added functionalities in postal tracking system, which are
still underway, and therefore the traditional system of relying upon CN 22 and
CN 23 will continue for the time being. It may be noted that under notification
50/2017 – Cus dated 1.7.2017 (Sl. No. 608A) bonafide gifts up to a CIF value of Rs 5000=00 (Rs. Five Thousand
only) intended for personal use have been exempted from duty.
12. In view of the amendments carried out to
heading 9804, it follows by principle of exclusion, that
imports by a legal person (firms, companies, other forms of business entities) or
which are for trade, manufacture or agriculture, cannot be regarded as
personal imports and shall not fall within CTH 9804. Such imports by post shall
be classified as per Customs Tariff and shall require an IEC, except as
provided under para 2.07 of the HBoP 2015-20.
13. Since any import other than personal
would be in furtherance of business, there is a requirement of filing a
declaration, payment of customs duties & IGST, which is to be available as
credit to the importer. Also, compliance of foreign exchange remittance for
imported goods requires a customs declaration. All these requirements
necessitate filing of a bill of entry, which is not possible in the postal
clearance eco-system. Accordingly, imports by legal persons or imports connected
with trade or manufacture or agriculture would require that the importer
file a bill of entry at a jurisdictional customs station with EDI facility for
payment of duties provided that the CIF value exceeds Rs
1000 (Rupees One Thousand only) [notification 50/2017 Sl. No: 610 refers]. It
may also be noted that import of commercial samples under notification
154/94-Cus dated 13.7.1994, as amended, warrants filing a Bill of Entry as it
is limited to IEC holders and subject to various other conditions including
value limits.
14. In order to provide time for the trade
to adopt new procedures and Commissionerates to put
in place commensurate administrative arrangements, the new Regulations come
into effect from 21st June 2018.
15. Difficulties, if any, should be brought
to the notice of the Board
F.No: 476/02/2016-LC