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Warehousing of goods - Fresh instructions
Circular No. 13 dated 28th
February 1996
I am directed to refer to
an audit objection from C & AG received by the Board wherein the Audit has
pointed out that the Department had failed to initiate timely action under
section 72 of the Customs Act, 1962 in respect of the consignment of imported
and bonded ship stores leading to the loss of Government Revenue. On
ascertaining the facts it was learnt that the goods were of perishable nature
and had been lying in the warehouse ranging between one to five years. Such
goods had lost their commercial value due to prolonged storage. The facts
further revealed that due care in extending the warehousing period keeping the
perishable nature of goods in view, had not been taken. Consequently, the (i)
importer relinquished the title of the goods under section 23(2) of the Customs
Act, thereby enabling the importer for non-payment of customs duty. Had due care
been taken to raise demands keeping the limited life of the perishable goods in
view, the situation as aforesaid would not have arisen. The facts also revealed
that the department neither extended the warehousing period not did they raise
nay demand for payment of duty and interest in terms of section 72 of the
Customs Act. The loss of revenue viz. customs duty and interest had occurred due
to utter negligence of the Commissionerate staff.
In order to
ensure that such situation as reported by the Audit does not occur again the
Board desires that:
i) Care should
be taken while granting extension in warehousing period particularly to the
goods having limited shelf life and/ or those of perishable nature.
ii)
Where the warehoused goods have not been removed from a warehouse at the
expiration of the period during which such goods are permitted under
section 61 to remain in warehouse, an immediate demand should be
raised against the owner of the warehoused goods for full payment
of duty, penalties, rent, interest and other charges and if the owner fails to
comply with a demand, steps should be taken to
detain and sell the goods after due notice to the owner, in order to safeguard the
Government Revenue.
Suitable instructions may
be issued to all concerned.
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