Open House Meeting held on 09-02-2004

OFFICE OF THE CHIEF COMMISSIONER OF CUSTOMS
MUMBAI ZONE-I, NEW CUSTOM HOUSE ,
BALLARD ESTATE, MUMBAI-400 001.

F.No-. S/I-22(4)/2003 CCO
Date : 17.02.2004

MINUTES OF THE OPEN HOUSE MEETING OF THE CHIEF COMMISSIONER OF CUSTOMS, MUMBAI ZONE-I, II & III HELD WITH REPRESENTATIVES OF THE TRADE AND INDUSTRY ASSOCIATIONS ON 09.02.2004 AT 3.30P.M. IN THE CONFERENCE HALL OF MUMBAI CUSTOMS HOUSE.

The Open House meeting for this month was held under Shri K.M.Tiwari, Chief Commissioner of Customs, Mumbai Zone-I, Shri Joseph Dominic, Chief Commissioner of Customs, Mumbai Zone-II & Shri Jogendra Singh, Chief Commissioner of Customs, Mumbai Zone-III on 09th February, 2004 in the Conference Hall, 2nd flr., New Custom House, Ballard Estate, Mumbai.

The following officers were present:
1. Shri D.S.Sra, Commissioner of Customs (General), Mumbai.
2. Shri C.M.Mehra, Commissioner of Customs (Export Promotion), Mumbai-I.
3. Shri Ahmed Hussain, Commissioner of Customs (Imp.), Mumbai-I.
4. Shri Anil Taneja, Commissioner of Customs(Exp.),ACC,Mumbai-II
5. Shri C.M. Sharma, Addl. Commissioner of Customs, CCO, Mumbai-I.
6. Shri O.P.Khanduja, Addl. Commissioner of Customs (CCO), Mumbai-I.
7. Shri Vivek Prasad, Addl. Commissioner of Customs (Imp.), Mumbai-I.
8. Shri Srinivas Rao, Joint Commissioner of Customs, Nhava Sheva.
9. Shri Rajendra Singh, Joint Commissioner of Customs (E.P.),Mumbai-I.
10. Shri Chandrakant Valvi, Jt.Commissioner of Customs(Imp.),Mumbai-I.
11. Shri S.S.Sandhu, Jt. Director General of Foreign Trade, Mumbai.
12. Shri Darshan Singh, Jt. Director General of Foreign Trade, Mumbai.
13. Shri N.P. Chandy, Deputy Commissioner of Customs (CCO), Mumbai-I.
14. Shri B.C.Sahoo, Appraising Officer, CCO, Mumbai-I.

The following representatives of the Trade & Industries Associations and the Bombay Custom House Agents Association attended the meeting:
1. All India Importers & Exporters Association (AIIEA).
Shri Mohan Nihalani

2. Bombay Custom House Agent's Association (BCHAA).
Shri Sorab P. Engineer
Shri R. Radhakrishnan
Shri Omprakash Agrawal
Shri Pankaj Shah
Shri Nimish Desai
Shri Rajiv Desai
Shri Naval H. Mehta
Shri Dushyant Mulani
Shri Bharat M. Shah

3. Mumbai & Nhava Sheva Ship Agent's Association (MANSA)
Shri R.B.Mankodi

4. The Association Chamber of Commerce & Industries of India (ASSOCHAM)
Shri George Joseph
Shri Rajendra Nair

5. FIEO (Federation of Indian Exporter Organisation).
Shri Gulam Mohd.

6. Maharashtra Chamber of Commerce & Industries (MCCI)
Shri H.S. Birdi

7. IMC (Indian Merchant Chambers)
Shri K.M. Doshi
Shri Virendra Parekh

8. BCCI
Shri Pravin K. Kanaki

9. FICCI
Shri R.N.Kunde

10. CII
Shri C.M. Tungare

13. Individual/Member of the Public
Shri Rajiv Gupta

2. The Chief Commissioners of Customs, Mumbai (S/Shri Joseph Dominic (Zone-II), K.M.Tiwari (Zone-I) and Jogendra Singh (Zone-III) welcomed all the members of Trade, Industry, CHAs Association and officers present in the meeting. Thereafter, the Minutes of the meeting held on 05.01.2004 were confirmed.

3. The Agenda points were taken up for discussions. The representatives of Trade, Industry and CHA association raised the following points:-

I. Issues raised by Khatri Siddick Hassam :
3.1 Shri Gulam Mohd. representing Khatri Siddick Hassam's case brought out that he was not discussing the merit of the case now and has only grievance as that his consignment could have been provisionally released right in the beginning or alternately the samples could had been drawn immediately rather than waiting for 13 days. Because of the delay in drawing the samples for testing the consignment could not reach the destination in time.

3.1.1. The Chief Commissioner of Customs informed that the percentage content of the silk in the resultant product as well as the total quantity of the silk as input used in the manufacture of the resultant product were found to be misdeclared on the Shipping Bills. The Test Report confirmed the misdeclaration. The case was adjudicated expeditiously. Even in the Appeal the charge of misdeclaration was sustained. Therefore, the doubt raised by the Departmental officers and the test of the samples was justified. However, he assured that the testing of the samples (when needed) will be done expeditiously without loss of time. He also assured that instructions will again be issued to release the consignment provisionally as early as possible to avoid increase in transaction cost and inconvenience to the Exporters.

 
(Action : Commissioner (Gen.), (Imp.) & /Exp.), Zone-I & II)

II Points raised by Bombay Chamber's of Commerce & Industry:
3.2 Graphite India Ltd. (Formerly Carbon Everflow Ltd.): It was stated that the company has submitted application for the refund of Customs Duty Form Part 'A' vide their letter No.CEL:PUR-B-201:2001 dtd. 01.02.2001 alongwith Deficiency Note issued by the Customs. The company has also submitted a Chartered Accountant Certificate dtd. 24.01.2001 and 11.01.2002 stating that the company has not passed on the excess duty payment to any other person alongwith their said refund application form. The company has also desired personal hearing. The company has also requested Commissioner of Customs (Refund) vide their letter dtd. 11.12.2003 but they have not received any response in this respect.

3.2.1 The Chief Commissioner clarified that M/s.Graphite India Ltd. was served with a Deficiency Memo on 12.02.2001 and alongwith this Deficiency Memo all the original papers were also returned to the party. Thereafter, the party has not submitted the reply to the Deficiency Memo and the original documents. On 05.02.2004 the party was again contacted and requested to furnish the relevant documents alongwith reply to the query raised in the Deficiency Memo dtd. 12.02.2001. The Member present handed over the papers and it was assured that the refund claims would be processed expeditiously.

3.3 Paville Fashions Pvt. Ltd.: It was stated that Drawback claims against the Shipping Bill No. 5011058 dtd. 27.3.2003 for Rs.9,453/-, Shipping Bill No.5019684 dtd. 08.4.2003 for Rs.13,071/- and Shipping Bill No.5056221 dtd. 03.6.2003 for Rs.4,903/- are still pending with Air Cargo Complex, inspite of fulfilling the requirements by company.

3.3.1 The Chief Commissioner clarified that all the three drawback claims were sanctioned on 11.4.2003, 15.10.2003 and 04.4.2004 respectively. The Member present confirmed the sanction of the drawback claim and requested not to discuss the issue further.

III Points raised by All India Importers' & Exporters' Association
3.4
Conversion of Free Shipping Bills to DEPB Shipping Bills : It was stated that at the last Open House Meeting held on 05.01.04 the matter was discussed in detail. However, Central Board of Excise and Customs has withdrawn this scheme vide Circular No.04/2004 dtd. 16.01.2004. This is both unfair and unjust. We have come to understand that the said scheme has been withdrawn because certain Customs Houses represented to CBEC about their inability to implement the said scheme due to shortage of staff and failure of the Customs staff to trace the related files. Also the said Circular does not address cases where exporters were forced to convert DEPB Shipping Bills to Free Shipping Bills by Customs Officials.

We shall be agitating with the Govt. about the illegality about the withdrawal of the said scheme, since some exporters have already been granted DEPB under the said scheme. However, what we wish to discuss is the question of shortage of staff per se and failure of the Customs staff to trace files. These issues are hurting Trade in its entire interface with the Customs. We desired a detailed discussion in the matter in order to find solutions.

3.4.1 The Chief Commissioner clarified that none of the Commissionerates i.e New Custom House, Air Cargo Complex or Nhava Sheva has reported any shortage of the staff to the Board and therefore it is not correct to say that because of shortage of staff, the scheme of allowing conversion of Free Shipping Bills to DEPB has been modified by the Board under Circular no. 4/2004 dtd. 16.01.2004. The Chief Commissioner further clarified that the issuance of an amendment to the above said Circular is a Policy matter within the powers and jurisdiction of the Ministry of Finance and cannot be interfered with at our level. Therefore, he requested the Members to agitate the issue before Ministry in case they were not satisfied with the present amendment.

3.5 Customs & EDI : It was stated that the Director (Systems) has visited Mumbai several times in order to explain the new parameters of EDI, more specifically the Icegate Project. We have been given some very exciting insight in these areas. We shall be grateful if update is given to us in the matter.

3.5.1 The Chief Commissioner urged the Members of the Trade to take maximum benefit of the Icegate facility as at present it was not been used to its optimum level. He also stated that update of EDI is circulated on regular basis by way of issue of Public Notices. The Website of the individual Customs House is also updated with the latest developments. He called upon the Trade to put forward the problems faced by them while using EDI Icegate system and also their views and suggestion for improvement of the system to the Directorate General of Systems, New Delhi. Some of the Members of the Trade brought out that the petty amendments such as change of name of Vessel, Port, Omission and Commission of figures and letters create difficulty while using Icegate system and thus consume lot of time. The Members expressed that regular meetings with the System officials be held to discuss the problems faced by them and improve upon the working of the system. The Chief Commissioner stated that a regular meeting once in two months will be organised with the officials from the Directorate of Systems and the local Systems Managers to ameliorate the difficulties of the Trade.

 
(Action : ADG(Systems)/Commissioner(Gen.)/System Manager- Nhava Sheva & A.C.C.

IV Points raised by Shri Rajiv Gupta :

3.6 Demand for C.Excise certification in case of deemed export licences for release of bank guarantee: It was stated that two times certification is not a solution to the problem but it only adds up in terms of transaction costs and delays. RLA views in this matter may please be considered.

3.6.1 This issue was discussed in the last Open House Meeting held on 05.01.2004 and it was minuted at Para 3.9.1 that DGFT will examine as to whether the original certified documents submitted to them can be returned to the exporter for their production to the Customs Authority. Shri S.S.Sandhu, Jt. DGFT, explained that verification is necessarily to be done and DGFT is not equipped to verify the facts and therefore the verifications by the Excise Officers cannot be dispensed with. The Chief Commissioner clarified that to expedite verification he will address Chief Commissioners of C.Excise to verify deemed export of 100% EOU expeditiously to avoid escalation of the transaction cost and delay in use of licence.

 
(Action : Commissioner(E.P.)- NCH/ACC & JCH)

3.7 Shipment on valid for shipment endorsement counter receipt : It was stated that the decision in this matter from the RLA is awaited.

3.7.1 This point was raised in the last Open House Meeting held on 05.01.2004 and it was minuted at Para 3.10.1 that DGFT will examine the issue independently and issue instructions. Shri S.S.Sandhu, Jt. DGFT, clarified that issue has to be studied in depth and therefore the Chief Commissioner Shri Joseph Dominic advised to form a committee headed by Shri S.S.Sandhu, Jt. DGFT and assisted by S/Shri Rajendra Singh, Jt. Commissioner (E.P) and Srinivas Rao, Jt. Commissioner (JCH) to study the problem and suggest appropriate solutions.

 
(Action : Jt. Commissioner (E.P.), Mumbai Zone I & II)

3.8 Amendment in the name of the vessel & voyage number : It was stated that the decision in this matter from the RLA is pending.

3.8.1 The Chief Commissioner clarified that the issue was discussed in the Open House Meeting held on 01.12.2003 also. He clarified that instructions will be issued to all the officers that wherever amendments are done manually on the Shipping Bills, these amendments would be properly signed and stamped with the name and designation of the officer to avoid any difficulty in DGFT office.

3.9 Issuance of certificate : It was stated that when transferable licences expire in the custody of the Customs department then the Customs is obliged to issue certificate for the revalidation of the document in terms of Para 2.13 of HBP. Why the certificates cannot be issued in case of such defaults in a time bound manner.

3.9.1 The Chief Commissioner clarified that Department is issuing certificates in such cases and Trade was requested to bring up details of any specific cases where such certificate has been delayed or denied.

3.10 Levy of anti-dumping duty : It was stated that it is not possible that duty is illegally collected in the first place and thereafter the importer is made to run from pillar to post to get the refund of it. Therefore, clear cut instructions are needed down the line for implementation.

3.10.1 The Chief Commissioner clarified that this point was discussed in the last Open House Meeting held on 05.01.2004 and as minuted at Para 3.12.1 of the Minutes dtd. 21.01.2004, the Anti-Dumping duty shall be charged as along as the Notification for charging Anti-Dumping duty remains valid.

3.11 Registration at one port suffices : It was stated that decision is not getting implemented. Can the instructions be issued ?.

3.11.1 The Chief Commissioner pointed out that this issue was raised in the Open House Meeting held on 01.12.2003 and as per Para 3.3 of the Minutes dtd. 10.12.2003 it was clarified that Registration at one port in Mumbai would suffice for clearance at the other two ports and Members were requested to bring out any difficulty faced by them in any specific case.

V. The following points outside the Agenda points were also taken up for discussions :

3.12 Shri George Joseph, ASSOCHAM brought out there is no uniformity in the format used in Bank Guarantee containing Automatic Revalidation Clause and therefore he desired that a proper Bank Guarantee format may be devised and circulated so that all the Customs House of Zone-I, II and III uniformly accept the same.

3.12.1 The Chief Commissioner clarified that this issue has to be decided after proper examination as it involves legal aspects. He requested the Trade to furnish their difficulties in detail to the Commissioner of Customs (Import), Mumbai Zone-I for in depth examination.
(Action : Commissioner (Import), Mumbai Zone-I )

3.13 Shri Bharat Shah of BCHAA requested that Public Notice may be issued so that SBI, ACC Branch would accept payment of duty payable by the couriers.

3.13.1 Shri Omprakash Agarwal of BCHAA intervened and stated that the Public Notice is being issued in this regard as informed by Shri M.C.Thakur, Commissioner of Customs (Airport). Therefore, this point need not be discussed any further.

3.14 Shri Sorab P. Engineer of BCHAA requested that the facility of not submitting a Bank Guarantee by Status Holders may be extended to all areas of Customs clearances viz. Imports etc., and should not be limited only for the purpose of Exports.

3.14.1 The Chief Commissioner informed that Bank Guarantees are obtained for various specified purposes in case of Imports and as such no general exemption from executing any Bank Guarantee can be given in case of Imports made by the Status Holders.

3.15 Shri Mohan Nihalani of the AIIEA requested whether the exports made by EPCG licence before getting the goods under the EPCG Scheme would be counted towards the Export Obligations.

3.15.1 Shri Darshan Singh, Jt. DGFT, clarified that under EPCG Scheme the exports made after the installation of the goods imported under the EPCG Scheme would only be counted towards the Export Obligation.

3.16 Shri Gulam Mohd. of FIEO brought out that as per new Policy sample for ascertaining content of Azo-dyes have to be reduced from 100% to 25% and the test report are to be valid for 6 months.

3.16.1 The Chief Commissioner clarified that DGFT has to specify the accredited Agencies and, therefore, he requested the Trade to approach DGFT for solution.

4. Thereafter, the Chief Commissioner of Customs, Zone-II specifically requested the Trade and the Association to submit their points for discussion in the meeting in elaborate, specific and accurate manner, so that the same could be addressed/redressed efficiently and properly.

The Chief Commissioner of Customs, Zone-II, also requested the Trade to pay the duty as soon as the assessment of the Bills of Entry is completed. This measure will help the Department to achieve maximum revenue in the Financial Year ending 31st March, 2004.

5. The Chief Commissioners of Customs thanked all the members present.

6. The next meeting will be held on Monday, the 8th March, 2004 at 15.30 hrs.. The points sponsored for the meeting should reach the O/o Chief Commissioner of Customs, Mumbai Zone I, II & III latest by 20.02.2004 positively.

(O.P.KHANDUJA)
Addl. Commissioner of Customs/CCO
Mumbai - I



Copy to :
1. The Chief Commissioner of Customs, Mumbai Zone-II & Zone-III.
2. All Commissioner of Customs, Mumbai Zone-I, II & III.
3. The Addl. Commr. of Customs (EDI), Mumbai - for website display.
4. The Jt. DGFT, Mumbai.

Copy for information and wide circulation to :

All Associations with a request to inform members to view the minutes on the website of Mumbai Customs at www.mumbaicustoms.gov.in



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