Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise and Customs
159A, North Block,
New Delhi - 110001.
Circular No.9 /2010-Customs
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)
F.No.502/5/2008-Cus.VI
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 |