Circular No.9
/2010-Customs
F.No.502/5/2008-Cus.VI
Government of
India
Ministry of Finance
Department of Revenue
Central Board of
Excise and Customs
159A, North Block,
New
Delhi - 110001.
8th April,
2010.
To
All Chief
Commissioners of Customs / Customs (Prev).
All Chief
Commissioners of Customs & Central Excise.
All Commissioners of
Customs / Customs (Prev).
All Commissioners of
Customs & Central Excise.
Subject: Issue of Custom House Agent License –
Reference from field formations – regarding.
***
Sir / Madam,
It has been brought
to the notice of the Board by certain field formations that they are facing
difficulties in issuance of Custom House Agents (CHA) License for eligible
persons and in implementation of the Custom House Agents Licensing Regulations
(CHALR), 2004.
2.
These issues were examined by the Board in consultation with customs field
formations and in the Board meeting. Further, a meeting was also held with the
Chief Commissioners of Customs having jurisdiction over major Custom Houses.
Accordingly the following decisions have been taken on the issues listed
below:-
(i) Minimum number
of CHAs required in a Customs station:
3.
Regulation 4 of the CHALR, 2004 provides the process of issue of CHA licences
whereby the Commissioner of Customs may invite applications for the grant of
such number of licences as assessed by him, to act as Customs House Agents in a
customs station. The CHALR, 2004 do not provide for any restrictions on the
number of CHAs. Board is of the
view that, ideally, no restriction should be placed on the number of CHAs
operating in the Custom Houses and the market forces should govern the number of
proficient and qualified persons required to carry out the job of CHA
commensurate with the volume of import / export cargo. The Board also did not find any
justification in prescribing a turnover based criteria for ascertainment of the
number of CHA licenses required to be issued at a particular Custom House /
Station, in as much as the practice of undertaking CHA services on the basis of
Form ‘C’ intimation was already in vogue and would render such exercise
meaningless. The Board, therefore,
has decided against fixing a numeric criterion governing the number of CHA
licenses being issued. Board has also decided that the examination under
Regulation 8 shall be conducted on an annual basis instead of twice a year, by
suitably amending the sub-regulation (1) to Regulation 8.
(ii) Employment of
person by a CHA:
4.
In the present scheme of CHALR, 2004 under regulation 19(1), the Custom
House Agent may employ any person who shall have a minimum educational
qualification of 10+2 School education.
However, appointment of such person shall be made only after obtaining
approval of the Deputy Commissioner / Assistant Commissioner (DC/AC) designated
by the Commissioner of Customs, who shall take into consideration the
antecedents and character of the person as provided in regulation 19(2) of
CHALR, 2004. In this regard, Board has decided that the DC/AC concerned, may
ensure that individuals involved in any
fraudulent activity (i.e., individuals suspended or blacklisted or denied
permission to work in any section of the Custom House) shall not be allowed to
be employed by a CHA for transacting business with Customs. Necessary undertaking in this regard may
also be taken from the CHA at the time of submission of application giving
details of the person who are proposed to be employed by
them.
4.2. CHALR, 2004
do not provide for any restriction on the number of persons a CHA can employ as
it would depend upon the workload and requirements of a CHA. However, under the regulation 19(3), any
person employed by CHA is required to appear through an examination conducted by
DC/AC designated or a Committee of officers to ascertain the adequacy of the
knowledge of such persons about the provisions of the Customs Act, 1962 before
they are granted ‘G’ Card. Hence, it is reiterated that it is only those persons
who have qualified themselves in the examination conducted under regulation
19(3) and who have been authorized by CHA in terms of regulation 19(5) alone are
allowed to sign the declarations filed before Customs for transacting the work
at any Custom station. Those
persons who have not qualified in the examination but who are still in
employment with CHA are being given ‘H’ card for assisting the CHA in his
work. However, the Commissioner of
Customs in a Custom House / Station shall undertake an annual review of such ‘H’
Cardholders with each CHA to ensure that discredited individuals are not being allowed
to work as ‘H’ Cardholders.
The examination under Regulation 19(3) shall also be conducted by
Commissionerate of Customs on annual basis.
(iii) Suspension
or revocation against CHAs operating on ‘C’ form intimation
basis:
5.1. CHALR, 2004
provide a facility for the CHAs who have been issued a license from a particular
customs station to operate under Form ‘C’ intimation at another customs station.
In case of such CHAs, who are found to have violated any provision of the CHALR,
2004 at any customs station, it is clarified that the suspension action against
CHA’s operations may be taken by the Commissioner of Customs at the station who
issued the CHA license and such action would either be limited to a particular
customs station where a violation has been noticed or action against the CHA in
general, applicable at all customs stations where the CHA operates, depending
upon the gravity and seriousness of the violation. Where the CHA licence is suspended, all
‘G’ and ‘H’ cards issued in respect of that licence would become
non-operational.
5.2. Further, it
is also clarified that the Commissioner of Customs at a customs station who had
authorised a CHA to operate on ‘C’ form intimation, should inform the details of
violations to the Commissioner of Customs at the customs station from where the
CHA licence was issued for such CHA, so that necessary action for suspension or
revocation of CHA licence, could be initiated by him. This would avoid
duplication and ensure uniformity in adjudication of a case against a CHA in
suspension or revocation proceedings by the Customs field formations. However,
the Commissioner of Customs, who had authorised a CHA to operate on ‘C’ form
intimation at a customs station, may take action in deserving cases under
regulation 21 of CHALR, 2004 for prohibiting the working of such defaulting CHA
in any section of the Custom House/Customs Station.
(iv) Know Your
Customs (KYC) norms for identification of clients by CHAs:
6.
In the context of increasing number of offences involving various
modus-operandi such as misuse of export promotion schemes, fraudulent availment
of export incentives and duty evasion by bogus IEC holders etc., it has been
decided by the Board to put in place the “Know Your Customer (KYC)” guidelines
for CHAs so that they are not used intentionally or unintentionally by importers
/ exporters who indulge in fraudulent activities. Accordingly, Regulation 13 of CHALR,
2004, has been suitably amended to provide that certain obligations on the CHAs
to verify the antecedent, correctness of Import Export Code (IEC) Number,
identity of his client and the functioning of his client in the declared address
by using reliable, independent, authentic documents, data or information. In
this regard, a detailed guideline on the list of documents to be verified and
obtained from the client/ customer is enclosed in the Annexure. It would also be obligatory for the
client/ customer to furnish to the CHA, a photograph of himself/herself in the
case of an individual and those of the authorised signatory in respect of other
forms of organizations such as company/ trusts etc., and any two of the listed
documents in the annexure.
(v) Time limit for
completion of suspension proceedings against CHA licensee under regulation
22:
7.1. The present
procedure prescribed for completion of regular suspension proceedings takes a
long time since it involves inquiry proceedings, and there is no time limit
prescribed for completion of such proceedings. Hence, it has been decided by the
Board to prescribe an overall time limit of nine months from the date of receipt
of offence report, by prescribing time limits at various stages of issue of Show
Cause Notice, submission of inquiry report by the Deputy Commissioner of Customs
or Assistant Commissioner of Customs recording his findings on the issue of
suspension of CHA license, and for passing of an order by the Commissioner of
Customs. Suitable changes have been made in the present time limit of forty five
days for reply by CHA to the notice of suspension, sixty days time for
representation against the report of AC/DC on the grounds not accepted by CHA,
by reducing the time to thirty days in both the cases under the
Regulations.
7.2. In cases
where immediate suspension action against a CHA is required to be taken by a
Commissioner of Customs under regulation 20(2), there is no need for following
the procedure prescribed under Regulation 22 since such an action is taken
immediately and only in justified cases depending upon the seriousness or
gravity of offence. However, it has
been decided by the Board that a ‘post-decisional hearing’ should be given in
all such cases so that errors apparent, if any, can be corrected and an
opportunity for personal hearing is given to the aggrieved party. Further, Board has also prescribed
certain time limits in cases warranting immediate suspension under Regulation
20(2). Accordingly, the
investigating authority shall furnish its report to the Commissioner of Customs
who had issued the CHA license (Licensing authority), within thirty days of the
detection of an offence. The
Licensing authority shall take necessary immediate suspension action within
fifteen days of the receipt of the report of the investigating authority. A post-decisional hearing shall be
granted to the party within fifteen days from the date of his suspension. The Commissioner of Customs concerned
shall issue an Adjudication Order, where it is possible to do so, within fifteen
days from the date of personal hearing so granted by him.
(vi) CHA licenses in
respect of individuals who had passed the examination under CHALR,
1984:
8.1. The issue
of granting CHA license in
respect of persons who had already passed the written and oral examinations held
under Regulation 9 examination of Customs House Agents Licensing Regulations
(CHALR), 1984 and are yet to be considered for issue of CHA license, was
examined by the Board. On this issue, the Board in its earlier meeting had held
that with the introduction of CHALR, 2004, there was no generalized case for
grant of CHA licence to such applicants having passed Regulation 9 examination
under CHALR, 1984 as the requirements of educational qualification and also
examination curriculum were different in the two regulations. Considering the hardships experienced by
such persons and in order to remedy the situation by providing one time
opportunity to qualify them for grant of CHA license, It has been decided by the
Board to conduct written examination for these persons on the following
additional subjects: (a) The Patents
Act, 1970 and Indian Copy Right Act; 1957 (b) Central Excise Act, 1944 (c)
export promotion schemes (d) Procedure on appeal and revision petition (e)
Prevention of Corruption Act, 1988 and (f) online filing of
electronic Customs
declarations, (g) Narcotic Drugs and Psychotropic Substances Act, 1985 and (h)
Foreign Exchange Management Act, 1999. The aforesaid examination would be
conducted by the Directorate General of Inspection after giving due notice to
these candidates. Accordingly, persons who qualify in the aforesaid examination
shall
be deemed to have passed under the Regulation 8 of Customs House Agents
Licensing Regulations, 2004, and would be considered for grant of CHA license in
terms of Regulations 9 of CHALR, 2004 by the concerned Commissionerate from
where they had earlier passed the CHA examination held under CHALR,
1984.
8.2. Board also
took note of the fact that these candidates had passed the CHA examination held
under CHALR, 1984 based on the qualification prevailing at that relevant point
of time, and that a precedent existed wherein a dispensation was prescribed vide
Board’s Circular No.48/2000-Customs dated 22.5.2000 for a specific period. Accordingly it was also decided by the
Board that in case of Regulation 9 examination passed candidates under the
CHALR, 1984, the relaxation provided in respect of educational qualifications
vide Board’s Circular No. 48/2000-Customs shall be extended on similar
basis.
9.
The aforesaid decisions of the Board involving change in the CHALR, 2004,
has been implemented by issue of Notification No.30/2010-Customs (NT) dated
8.4.2010.
10. These
instructions may be brought to the notice of the trade by issuing suitable
Trade / Public Notices. Suitable Standing orders/instructions may be
issued for the guidance of the field officers.
11.
Difficulties faced, if any, in implementation of this Circular, changes
made in the CHALR, 2004 may be brought to the notice of the Board
immediately.
Yours faithfully,
(M.M. Parthiban)
Director (Customs)
Annexure
Client/ Customer
Identification Procedure
Features to be
verified and documents to be obtained from clients/
customers
|
S.No |
Form of
organisation |
Features to be
verified |
Documents to be
obtained |
|
1 |
Individual |
(i) Legal name
and any other names used (ii) Present
and Permanent address, in full, complete and
correct. |
(i) Passport
(ii) PAN
card (iii) Voter’s
Identity card (iv) Driving
licence (v) Bank
account statement (vi) Ration
card Note: Any two
of the documents listed above, which provides client/ customer information
to the satisfaction of the CHA will suffice. |
|
2 |
Company |
(i) Name of the
company (ii) principal
place of business (iii) mailing
address of the company (iv) telephone,
fax number, e-mail address. |
(i) Certificate
of incorporation (ii) Memorandum
of Association (iii) Articles
of Association (iv) Power of
Attorney granted to its managers, officers or employees to transact
business on its behalf (v) Copy of PAN
allotment letter (vi) Copy of
telephone bill |
|
3 |
Partnership
firm |
(i) Legal name
(ii) Permanent
address, in full, complete and correct. (iii) Name of
all partners and their addresses, in full complete and
correct. (iv) telephone,
fax number, e-mail address of the firm and
partners. |
(i)
Registration certificate, if registered (ii)
Partnership deed (iii) Power of
Attorney granted to a partner or an employee of the firm to transact
business on its behalf (iv) Any
officially valid document identifying the partners and the person holding
the Power of Attorney and their addresses (v) Telephone
bill in the name of firm/ partners |
|
4 |
Trusts,
Foundations |
(i) Name of
trustees, settlers, beneficiaries and signatories (ii) Name and
address of the founder, the managers, Directors and the beneficiaries, in
full, complete and correct. (iii) Telephone
and fax number, e-mail address of the trust, founder and
trustees. |
(i) Certificate
of Registration, if registered (ii) Power of
Attorney granted to transact business on its behalf (iii) Any
officially valid document to identify the trustees, settlers,
beneficiaries and those holding the Power of Attorney, founders/ managers/
directors and their addresses (iv) Resolution
of the managing body of the foundation/ association (v) Telephone
bill |