West Asia Crisis: CBIC Issues New Rules for Returning Export Cargo

New Delhi: In the wake of supply disruption of crude due to the ongoing West Asia war, the customs department under the Union finance ministry has come out with rules for dealing with export cargo returning to Indian ports due to the closure of the Strait of Hormuz and disruptions in maritime routes.

Issuing some norms, the Central Board of Indirect Taxes and Customs (CBIC) said that it would be valid for 15 days. The department also stipulates that in all such cases, the vessel shall be permitted to berth only at the same Indian port from which it departed, except in the case of transhipment.

In a the CBIC circular, it also said that the field offices will recover all export incentives, including IGST, drawback, etc., manually from such cargo, if they have already been disbursed. “The present circumstances constitute an exceptional situation affecting international shipping routes and export logistics,” the CBIC said.

The move of the department comes after receiving representations from field formations indicating that, due to the closure of the Strait of Hormuz and the consequent disruption in maritime routes. “Certain vessels carrying export cargo from India are unable to reach their destination ports and are returning to Indian ports. We have requested to prescribe a simplified procedure for handling such cargo,” it said.

The CBIC has prescribed three procedures to facilitate trade and ensure expeditious handling of such cargo, where export cargo is brought back to Indian ports due to the closure of the Strait of Hormuz or similar disruptions.

“First, in case the cargo is loaded on a vessel, and the vessel is within Indian territorial waters, and an export general manifest or EGM and a sea departure manifest or SDM are not filed, the master of the vessel/captain shall submit an undertaking stating that the vessel has not crossed the territorial waters of India,” it said.

Secondly, it said, in case a vessel is within Indian territorial waters, and an EGM or SDM was filed, or the vessel is beyond Indian territorial waters and is in international waters and returning without calling any foreign ports, the master of the vessel/captain shall submit an undertaking.

“Thirdly, in a situation where a vessel is beyond Indian territorial waters and is in international waters and returning to India after calling any foreign port without discharge of any container, such consignments shall be treated as exported out of India,” it said.

The circular further said that these containers may be offloaded at the port terminal without filing a bill of entry, subject to verification of SDM and related shipping documents. Details of such cancelled shipping bills shall be shared with RBI, DGFT and other concerned agencies by ICEGATE. “In all such cases, the vessel shall be permitted to berth only at the same India port from which it departed, except in case of transhipment,” the CBIC said.