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

MINUTES OF THE OPEN HOUSE MEETING OF THE CHIEF COMMISSIONERS OF CUSTOMS, MUMBAI ZONE-I, II & III HELD WITH THE REPRESENTATIVES OF THE TRADE AND INDUSTRY ASSOCIATIONS ON 12th April 2007 AT 3.30 P.M. IN
THE CONFERENCE HALL OF THE MUMBAI CUSTOM HOUSE

The Open House Meeting for the month of April, 2007 was held under the Chairmanship of Shri K. M. Tiwari, Chief Commissioner of Customs, Mumbai Zone I, Shri N. Sasidharan, Chief Commissioner of Customs. Mumbai Zone-II on 12.04.2007 in the Conference Hall, New Custom House, Ballard Estate, Mumbai - 400 001. Shri S.S.Sandhu, Jt. D.G.F.T, Mumbai also attended the meeting.

2. The following representatives of the BCHAA, Trade and Industry attended the meeting:
i) BCHAA (Bombay Custom House Agent’s Association)
Shri. Om Prakash Agrawal, Shri Naval Mehta, Shri H.D.Mehta, Shri Nailesh Gandhi, and Shri Rajiv Desai.

ii) AIIEA (All India Importers & Exporters Association)
Shri Mohan Nihalani.

iii) Indian Merchant Chamber
Shri K. M. Doshi, and Shri Mark S. Fernandes

iv) MANSA
Shri H.D. Kulkarni,

v) ASSOCHAM
Shri George Joseph

vi) Synthetic and Rayon Textiles Export Promotion Council, Mumbai
Shri A. Ravindra Kumar (Deputy Director)

vii) Bombay Chamber of Commerce & Industry
Shri. Pravin K Kanakia

viii) The Chemical & Alkali Merchants Association
Shri. Bharat Shah and Shri. Pankaj Vora

3. At the outset both the Chief Commissioner of Customs, Zone – I and II welcomed the Members. The Chief Commissioner of Customs, Zone - I informed the Members that the Revenue Targets for the 3 Mumbai Customs Zone have not only been achieved but has been exceeded. It was mentioned that this could not have been possible without the pro-active support of the Community Importers, Exporters, Traders and C.H.A’s and expressed the gratitude of the department and thanked the representatives of Trade and Industry for the same. Chief Commissioner of Customs Zone – I also informed the Members that RMS has been implemented in the Export Commissionerate in Mumbai Custom House with effect from 09.04.2007. He informed the Members that some DEPB consignments have already been facilitated under the RMS scheme in the Export Promotion Commissionerate, Mumbai Custom House. He also informed the Members that if necessary the Trade can interact with Member (Systems) regarding RMS and Systems related problems on 18.04.2007 at Nhava Sheva and on 19.04.2007 at New Custom House, Mumbai. All the Members present expressed their happiness on exceeding the Revenue Target for 2006-07 which is a clear indications of booming international trade through Mumbai and remarked that it would have not been possible without the co-operative efforts of junior level officers of the Customs department under the able guidance of their Seniors to ensure faster clearance. Shri. Mark Fernandes reminded the Chair and the Members that Mumbai Port was in red about two years ago but, there has been tremendous increase in business at Mumbai Port during the last two years and this would not have been possible without the hard work towards trade facilitation by the officers of Mumbai Customs. All the Members expressed happiness over the increase of work at Mumbai Port and hoped that they would receive same support from Customs Department in future also.

4. Thereafter, the discussions on the action taken on the minutes of the previous Meeting was initiated.

5. POINT NO 10 OF THE PREVIOUS MINUTES
With respect to point no. 10 of the previous minutes sponsored by The Synthetic & Rayon Textiles Export Promotion Council, Mumbai i.e. Import of spares not being allowed by JNPT Customs under EPCG Scheme shipped separately at a date subsequent to the shipment of capital goods, the concerned member was asked by the Chief Commissioner of Customs, Mumbai Zone – II to bring specific instances to his notice so that the matter could be resolved.

COMMENTS

Chief Commissioner of Customs Mumbai Zone – II informed the Members that no specific instance had been brought to his notice in the matter.

Jt. D.G.F.T, Mumbai informed the Members that spare parts can be imported within the overall limit of quantity and value of EPCG Licence and if separate endorsement is required for spares imported separately at a later date after the import of capital goods due to systems requirement, they would issue separate endorsement in this regard to the importers if such requests are made to them. Members thanked the Jt. D.G.F.T for this assurance.
The point was considered to be closed.

6. Point sponsored by All India Importers and Exporters Association
Shri Mohan H. Nihalani pointed out that the Minutes of the previous Permanent Trade Facilitation Committee at JNCH, were not being taken up for discussion in the subsequent meetings.

It was informed by Chief Commissioner Zone – II that during the Permanent Trade Facilitation Meeting held on 25.01.2007, at JNPT it was agreed that the Members of Trade give a brief on all long standing issues pertaining to JNCH, since the Commissioner and Chief Commissioner joined only recently and did not have the full background of pending issues. This would enable the Department to take up all such issues for the purpose of finding solutions after carefully examining the same. However, it was noted that no such briefs were forwarded by the Members of the Trade for consideration in the next meeting held on 22.02.2007. Therefore such points could not be taken up for discussion during the said meeting held on 22.02.2007. This did not mean that the unresolved points of any previous Meeting would not be taken up for discussion in the subsequent Meetings. Further, urgent issues could always be raised in the Permanent Trade Facilitation Meetings.

COMMENTS

The Chief Commissioner of Zone – II has given assurance to the Members in the Permanent Trade Facilitation Committee held on 23.03.2007 at JNCH that
the trade could raise any issue of urgent nature in the TFC meeting without prior notice. He also clarified that outstanding issues arising out of the earlier meeting reflected in the minutes would also be discussed when some action was kept pending till the matter is resolved.

Shri Mohan Nihalani requested the Members who were not attending the Trade Facilitation Committee Meeting at JNCH, to attend it in future so that they could get their issues resolved. All Members expressed satisfaction over the clarification by the Chief Commissioner Mumbai Zone – II and assured their full co operation in the future meetings of Trade Facilitation Committee at JNCH. The point was considered to be closed.

NEW POINTS

7. SL.No.1 Point sponsored by M/s Aloka Exports, Mumbai: Insistence upon submission of Affidavit and Bond by JNPT Customs for Target Plus Scheme.

M/s Aloka Exports, Mumbai have represented regarding insistence by JNPT Customs for execution of Bond and Affidavit for import under target plus scheme. They have informed that their Export Product Group is Textile-General and the import is governed by Custom Notification No. 73/2006 dated 10.07.2006 subject to actual user conditions. However when they approached JNPT Customs for registration, they were asked to submit an affidavit & Bond for Rs. 10502057.00 for import of Textile-General for Rs. 7242798.10. There is 15% penal interest amount of Rs. 3259259.00 for 3 years.

M/s Aloka Exports also informed that under Foreign Trade Policy they have no export obligation as this benefit is issued to them for incremental exports achieved in the past, except actual user conditions and no other obligations are attached to this and also Customs Notification No. 73/2006 do not provide for execution of such Bond. They wanted to know the authority under which JNPT Customs have compelled them to execute the Bond with 3 years penal interest.

COMMENTS

It has been informed by the Office of the Chief Commissioner of Customs, Mumbai Zone – II that the matter was examined. As per condition No. 4 of Notfn. No. 73/06 Cus. dated 01.07.06 which is applicable to imports under Target Plus Scheme, in respect of capital goods, office equipments and professional equipment, a certificate from jurisdictional Dy. Commissioner of Central Excise need to be produced confirming installation and use of such goods in the importer factory or premises within six months from the date of import or within such extended period as may be allowed.
To ensure compliance of the above condition, importers are required to execute LUT/bond. The bond amount normally covers the duty and interest @ 15% for period of 3 years but however no Bank Guarantee is required to be furnished.
In view of the existing practice of accepting LUT Bond under Target Plus Scheme, the importer M/s. Aloka Export has been asked to execute LUT. No one from M/s. Aloka Export was present in the meeting hence, the point was not discussed. The point was considered to be closed.

8. SL. No. 2 Point sponsored by Synthetic & Rayon Textiles Export Promotion Council, Mumbai: No reasons being offered by Help desk to exporters for reduction in Drawback amount at JNPT.

The concerned Members raised the point that the Help Desk started by JNPT Customs is acting as a delaying tactics for exporters as there is a delay in release of Drawback amounts and also reduction in Drawback amount in many cases. No reasons are being offered by the Help Desk for reduction in Drawback amount. The member informed that the exporters want specific reasons for reduction of Drawback in form of a letter to them so that they could use them for their accounting purpose. Exporters require the letter from Customs for any reduction of Drawback because their auditors insist for that. The concerned member requested the Chief Commissioner of Customs Zone II make suitable arrangements to know the reasons for reduction of Drawback by the Help Desk as it would be a great service to the exporters. He also requested that specific time frame should be fixed for issue of Deficiency Memos and also release of Drawback amounts.

COMMENTS

It was informed by Chief Commissioner of Customs Zone II that there is tremendous volume of Drawback Shipping Bills at JNPT Customs and hence it is not possible to provide individual reasons for reduction of Drawback at Help Desk. He also informed the Member that generally all the Drawback claims are settled within a period of one month from the date of filing of Shipping Bill, if there are no other problems viz, non filing of EGM’s by shipping lines or mis-match between EGM details and Shipping Bill details. He informed the Members that the delay in release in Drawback amounts is mainly due to non filing of EGM’s by shipping lines or mismatch between EGM details and Shipping Bills details. He also informed the Members due to tremendous work load and shortage of staff it would not be possible for JNPT Customs to issue the specific reasons for reduction of Drawback amounts to individual exporters in the form of a letter. However, he agreed that the matter will be looked into for finding a satisfactory solution in the future. It was further informed that Shipping Lines are not discharging their responsibility of filing EGMs in time even though in many cases penalty has been imposed on them, for late filing of EGMs. Unless the EGMs are filed and details of EGMs matches with details of Shipping Bills, the Drawback amount cannot be released by the Customs Computer System. He also drew the attention of the Members to the large number of errors in EGMs which takes long time for correction for which manual verification was needed requiring a lot of manpower. He requested the Members to take up the issue of late filing of EGMs and errors with the shipping lines Associations and the Shipping Ministry. He asked the member who was present from MANSA to explain as to what MANSA is doing in this regard. The representative from MANSA was of the view that the errors in EGMs could be due to exporter’s fault. He assured the Chair and Members that MANSA would take the initiative to resolve the late filing of EGMs by Members and to take up the matter with Shipping Ministry and concerned Shipping Associations to find out a solution to this persisting problem. The Chief Commissioners of Customs assured the Members that Customs will render support to such initiatives by the Shipping Associations and the Shipping Ministry as timely filing of error free EGMs would help the exporters in getting the drawback claims and other export incentives faster.

9. The meeting ended with a vote of thanks to the Chair.

10. The next Open House Meeting will be held on 16th May 07 at 3.30 Hrs. The points sponsored for discussion for the next meeting should reach positively by
07.05.07 in the offices of the Chief Commissioner of Customs, Mumbai Zone I, II, and III so that the issues can be taken up effectively.

(J. S. CHANDRASHEKAR)
ADDL. COMMISSIONER OF CUSTOMS,
CHIEF COMMISSIONER’S OFFICE,
MUMBAI ZONE – I.

Copy to:
1. The Chief Commissioner of Customs, Mumbai Zone II and III.
2. All Commissioners of Customs, Mumbai Zone I, II and III.
3. The Addl./Joint Commissioners of Customs (E. D. I.), Mumbai Customs/Jawahar Custom House, Nhava Sheva/Air Cargo Complex, Mumbai – for immediate uploading of the Minutes on the website.
4. Shri S. S. Sandhu, Zonal Jt. D. G. F. T., Mumbai.
5. Shri Y.G. Parande, D.G. Systems.
5. Shri Bani Bhattacharya, Additional Director (Systems), NCH, Mumbai.
Copy for information and wide circulation to:
All Associations with a request to inform all their members to view the Minutes of the Meeting on the Website of Mumbai Customs at www.mumbaicustoms.gov.in