Handling of Cargo in Customs Areas Regulations, 2009

[Notification No. 26/2009-Cus. (N.T.), dated 17-3-2009, as amended by

Corrigendum F. No. 450/55/2008-Cus-IV, dated 2-04-2009, Notification No.
96/2010- Cus. (N.T.), dated 12-11-2010, 43/2012-Cus. (N.T.), dated 16-05-
2012, 104/2012-Cus. (N.T.), dated 16-11-2012 115,2016-Cus.(N.T.) dated
26-08-2016, 24/2017-Cus.(N.T.) dated 31.03.2017, 29/2019-Cus.
(N.T.) dated 01.04.2019]

In exercise of powers conferred by sub-section (2) of section 141 read

with section 157 of the Customs Act, 1962 (52 of 1962), the Central Board
of Indirect Taxes and Customs hereby makes the following regulations,
namely:-

Regulation 1. Short title and commencement.-

(1) These regulations may be called the Handling of Cargo in Customs

Areas (Amendment ) Regulations, 2009.

(2) They shall come into force on the date of their publication in the
Official Gazette.

Regulation 2. Definitions.-

(1) In these regulations, unless the context otherwise requires, -

(a) "Act" means the Customs Act, 1962 (52 of 1962);

(b) "Customs Cargo Services provider" means any person responsible

for receipt, storage, delivery, dispatch or otherwise handling of
imported goods and export goods and includes a custodian as referred
to in section 45 of the Act and persons as referred to in sub-section (2)
of section 141 of the said Act;

(c) "Specified" means specified by a notification or an order issued

under the provisions of the Act;
(2) the words and expressions used herein and not defined but defined in
the Act shall have the same meanings respectively assigned to them in
the Act

Regulation 3. Application.-

These regulations shall be applicable to the handling of imported and

export goods in 1[ports, airports, inland container depots, land customs
stations and in customs areas approved or specified under section 8].

Regulation 4. Retrospective Application.-

Any action taken or anything done in respect of appointment of Customs

Cargo Service providers, immediately preceding the coming into force of
these regulations, shall be deemed to have been done under the
corresponding provisions of these regulations. Customs Cargo Service
providers already approved on or before the date of coming into force of
these regulations shall comply with the conditions of these regulations
within a period of three months or such period not exceeding a period of
one year as the 1[Principal Commissioner of Customs or Commissioner of
Customs, as the case may be] may allow from the date of coming into
force of these Regulations.

Regulation 1[5. Conditions to be fulfilled by Customs Cargo Service

provider -

The Customs Cargo Service provider for custody of imported goods or

export goods and for handling of such goods in a customs area shall fulfill
the following conditions, namely:-

(1) Provide the following to the satisfaction of the 2[Principal Commissioner

of Customs or Commissioner of Customs, as the case may be], namely:
(i) Infrastructure, equipment and adequate manpower for loading,
unloading, stacking, handling, stuffing and de-stuffing of containers,
storage, dispatch and delivery of containers and cargo etc., including :-

(a) Standard pavement for heavy duty equipment for use in the
operational and stacking area;

(b) free of cost or rent fully furnished office accommodation for

Customs, Customs Electronic Data Interchange (EDI) Service Centre,
with required amenities and facilities and residential accommodation
and transportation facilities for customs staff;

(c) Premises for user agencies with basic amenities and facilities;

(d) Storage facility, separately for imported, export and transhipment

goods;

(e) Gate complex with separate entry and exit;

(f) Adequate parking space for vehicles;

(g) Boundary wall;

(h) Internal service roads;

(i) Electronic weigh-bridge and other weighing and measuring

devices;

(j) Computerized system for location and accountable of goods, and

processing of documents;

(k) adequate air-conditioned space and power back up, hardware,

networking and other equipment for secure connectivity with the
Customs Automated system; and for exchange of information
between Customs Community partners;
 (l) Facilities for auction, including by e-auction, for disposal of
uncleared, unclaimed or abandoned cargo;

(m) Facilities for installation of scanning equipment;

(n) Security and access control to prohibit unauthorized access into

the premises, and

[(o) such other equipment or facilities as the Board or Principal

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Commissioner of Customs or Commissioner of Customs, as the case

may be, may specify having regard to the screening, examination,
custody and handling of imported or export goods in a customs
area.]

(ii) safe, secure and spacious premises for loading, unloading, handling
and storing of the cargo for the projected capacity and for the
examination and other operations as may be required in compliance
with any law for the time being in force;

(iii) insurance for an amount equal to the average value of goods likely
to be stored in the customs area based on the projected capacity, and
for an amount as the 2[Principal Commissioner of Customs or
Commissioner of Customs, as the case may be] may specify having
regard to the goods which have already been insured by the importers
or exporters.

(2) Undertake to bear the cost of the Customs officers posted, at such
customs area, on cost recovery basis, by the 2[Principal Commissioner or
Commissioner] and shall make payments at such rates and in the manner
prescribed, unless specifically exempted by an order of the Government of
India in the Ministry of Finance;

(3) Execute a bond equal to the average amount of duty involved on the
imported goods and ten per cent of value of export goods likely to be
stored in the customs area during a period of thirty days and furnish a
bank guarantee or cash deposit equivalent to ten per cent of such duty:

[Provided that the condition of furnishing of bank guarantee or cash

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deposit shall not be applicable to ports notified under the Major Ports Act,
1962 (38 of 1963) or to the Central government or State Governments or
their undertakings or to the Customs Cargo Service provider authorised
under Authorised Economic Operator Programme]

(4) Execute a separate bond for an amount equal to ten percent of value
of export goods with a bank guarantee for an amount equal to 5[ten]
percent of the value of the bond, towards the export goods transported
from the customs area to any other customs area for export or
transhipment, as the case may be;

[Provided that the condition of furnishing of Bank guarantee or cash

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deposit shall not be applicable to ports notified under the Major Ports Act,
1962 (38 of 1963) or to the Central Government or State Governments or
their undertakings or to the Customs Cargo Service provider authorised
under Authorised Economic Operator Programme.]

(5) Undertake to comply with the provisions and abide by all the provisions
of the Act and the rules, regulations, notifications and orders issued
thereunder.

(6) Undertake to indemnify the 2[Principal Commissioner of Customs or

Commissioner of Customs, as the case may be] from any liability arising
on account of damages caused or loss suffered on imported or export
goods, due to accident, damage, deterioration, destruction or any other
unnatural cause during their receipt, storage, delivery, dispatch or
otherwise handling.

Regulation 6. Responsibilities of Customs Cargo Service provider:

(1) The Customs Cargo Service provider shall -

(a) keep a record of imported goods, goods brought for export or

transhipment, as the case may be, and produce the same to
the 1[Inspector of Customs or Preventive Officer or Examining officer] as
and when required;

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[(aa) Provide information regarding arrival of the imported goods to the
Deputy Commissioner or Assistant Commissioner of Customs
immediately on arrival of said goods in the customs area and also
information about their departure after the clearance thereof].

(b) Keep a record of each activity or action taken in relation to the

movement or handling of imported or export goods and goods brought
for transhipment;

(c) Display or make available in any other manner, information of

process or movement or handling of imported or export goods and
goods brought for transhipment;

(d) demarcate separate areas for unloading of imported goods for their
storage with respect to the category of importers, nature of goods,
place of destination, mode of transportation or any other criterion as
the 3[Principal Commissioner of Customs or Commissioner of Customs,
as the case may be] may specify having regard to the custody and
handling of imported goods in a customs area;

(e) demarcate separate areas for loading of export goods for their
storage with respect to categories of exporters, nature of goods,
examined and sealed containers or other criterion as the 3[Principal
Commissioner of Customs or Commissioner of Customs, as the case
may be] may specify having regard to the custody and handling of
export goods in a customs area;
(f) not permit goods to be removed from the customs area, or otherwise
dealt with, except under and in accordance with the permission in
writing of the 1[Superintendent of Customs or Appraiser];

(g) Not permit any export cargo to enter the customs area without a
shipping bill or a bill of export having been filed with the 1[Deputy
Commissioner or Assistant Commissioner of Customs];

(h) Not permit any import cargo to enter the customs area or be
unloaded therein without the import report or the import manifest
having been filed with the 1[Deputy Commissioner or Assistant
Commissioner of Customs];

(i) be responsible for the safety and security of imported and export
goods under its custody;

(j) Be liable to pay duty on goods pilfered after entry thereof in the
customs area;

(k) be responsible for the secure transit of the goods from the said
customs area to any other customs area at the same or any other
customs station in accordance with the permission granted by
the 1[Deputy Commissioner or Assistant Commissioner of Customs];

(l) subject to any other law for the time being in force, shall not charge
any rent or demurrage on the goods seized or detained or confiscated
by the 1[Superintendent of Customs or Appraiser or Inspector of
Customs or Preventive officer or examining officer, as the case may be];

(m) dispose off in the manner specified and within a time limit of ninety
days, the imported or export goods lying unclaimed, uncleared or
abandoned:
Provided that the period of ninety days may be extended by
the 3[Principal Commissioner of Customs or Commissioner of Customs,
 as the case may be] by such further period as may be allowed, on
sufficient cause being shown for delay in the disposal;

(n) not make any alteration in the entry or exit points or boundary wall
without the permission of the Commissioner of Customs;

(o) shall bear the cost of the customs officers posted by the 3[Principal
Commissioner of Customs or Commissioner of Customs, as the case
may be] on cost recovery basis and shall make payments at such rates
and in the manner specified by the Government of India in the Ministry
of Finance unless specifically exempted by an order of the said Ministry;

(p) shall observe the Central Government holidays as followed by the

jurisdictional Customs formations and in case of any variation in the
working days, intimate the same to 3[Principal Commissioner of
Customs or Commissioner of Customs, as the case may be] and the
trade, at least seven days in advance, and

(q) Abide by all the provisions of the Act and the rules, regulations,
notifications and orders issued thereunder.

(2) The Customs Cargo Service provider approved for custody of imported
or export goods and for handling of such goods shall not lease, gift, sell or
sublet or in any other manner transfer any of the premises in a customs
area; or sub contract or outsource functions permitted or required to be
carried out by him in terms of these regulations to any other person,
without the written permission of the 3[Principal Commissioner of Customs
or Commissioner of Customs, as the case may be].

(3) The Customs Cargo Service provider shall publish and display 4[at
prominent places including website or webpage of the Customs Cargo
Service provider] the schedule of charges for the various services provided
by him in relation to the imported goods or export goods in the customs
area.
Regulation 7. Power to relax and regulate:

(1) if the 1[Principal Commissioner of Customs or Commissioner of

Customs, as the case may be] is satisfied that in relation to the custody
and handling of imported or export goods in a customs area, the Customs
Cargo Service provider, for reasons beyond his control, is unable to comply
with any of the conditions of regulation 5, he may for reasons to be
recorded in writing, exempt such Customs Cargo Service provider from
any of the conditions of regulation 5.

[Provided that no exemption shall be granted in respect of any of the

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conditions referred to in regulation 5, where the overall safety and security

of the premises are likely to be affected thereby.]

(2) The 1[Principal Commissioner of Customs or Commissioner of Customs,

as the case may be] may regulate the entry of goods in a customs area for
efficient handling of such goods.

Regulation 8. Commencement of operations:

The Customs Cargo Service provider approved for custody of imported or

export goods and for handling of such goods shall not commence any
operations in a customs area for the first time unless the 1[Principal
Commissioner of Customs or Commissioner of Customs, as the case may
be] is satisfied that all the requirements of the Act have been fulfilled and
grants permission to commence the operations by an order in writing.

Regulation 9. Application for approval of Customs Cargo Service

provider:

(1) An application to act as a Customs Cargo Service provider for custody

of imported or export goods and for handling of such goods in a customs
area shall be made in the form of a letter to the jurisdictional
Commissioner of Customs containing details as prescribed in 'Form A'.
(2) The 1[Principal Commissioner of Customs or Commissioner of Customs,
as the case may be] shall dispose of the application within forty five days
of the receipt of the application.

Regulation 10. Approval of appointment of a Customs Cargo

Service provider and review thereof:

(1) Where the 1[Principal Commissioner of Customs or Commissioner of

Customs, as the case may be] is satisfied that the applicant has fulfilled
the conditions prescribed in regulation 5, he may approve such an
applicant as a Customs Cargo Service provider, for a period of two years
from the date of issue of such approval.

Provided that a Customs Cargo Service provider already approved on or

before the date of coming into force of these regulations, shall be deemed
to be approved as a Customs Cargo Service provider under these
regulations for a period of five years from the date of compliance with the
conditions of these regulations as stipulated in regulation 4.

(2)The 1[Principal Commissioner of Customs or Commissioner of Customs,

as the case may be] shall review the approval granted under sub
regulation (1) before the expiry of the initial period of approval of two
years or five years, as the case may be, and may extend such approval to
a further period of five years at a time.

Provided that the 1[Principal Commissioner of Customs or Commissioner

of Customs, as the case may be], for reasons to be recorded in writing,
may order for review of the approval granted to any Customs Cargo
Service provider before the completion of the period of approval.

[Provided further that in case of Customs Cargo Service provider

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authorised under Authorised Economic Operator Programme', the approval

granted under sub-regulation (1) may be extended for a further period of
ten years at a time.]
Regulation 11. Suspension or revocation of approval for
appointment of a Customs Cargo Service provider:

(1) The 1[Principal Commissioner of Customs or Commissioner of Customs,

as the case may be] may, subject to the provisions of these regulations,
suspend or revoke the approval granted to the Customs Cargo Service
provider subject to the observance of procedure prescribed under
regulation 12 and also order for forfeiture of security, if any, for failure to
comply with any of the provisions of the Act and the rules, regulations,
notifications and orders made thereunder;

(2) Notwithstanding anything contained in sub-regulation (1),

the 1[Principal Commissioner of Customs or Commissioner of Customs, as
the case may be] may, in appropriate cases where immediate action is
necessary, suspend the approval granted to a Customs Cargo Service
provider where an enquiry against such Customs Cargo Service provider is
pending or contemplated.

Regulation 12. Procedure for suspension or revocation of approval

and imposition of penalty:-

(1) The 1[Principal Commissioner of Customs or Commissioner of Customs,

as the case may be] shall issue a notice in writing to the Customs Cargo
Service provider stating the grounds on which it is proposed to suspend or
revoke the approval and requiring the said Customs Cargo Service
provider to submit within such time as may be specified in the notice not
being less than thirty days, to the Assistant Commissioner or Deputy
Commissioner of Customs nominated by him, a written statement of
defence and also to specify in the said statement whether the Customs
Cargo Service provider desires to be heard in person by the said Assistant
Commissioner or Deputy Commissioner of Customs.

(2) On receipt of the written statement from the Customs Cargo Service
provider, or where no such statement has been received within the time-
limit specified in the notice referred to in sub-regulation (1), the Assistant
Commissioner or Deputy Commissioner of Customs may inquire into such
of the grounds as are not admitted by the Customs Cargo Service
provider.

(3) The Assistant Commissioner or Deputy Commissioner of Customs shall,

in the course of inquiry, consider such documentary evidence and take
such oral evidence as may be relevant or material to the inquiry in regard
to the grounds forming the basis of the proceedings and he may also put
any question to any person tendering evidence, for or against the Customs
Cargo Service provider, for the purpose of ascertaining the correct
position.

(4) The Customs Cargo Service provider shall be entitled to cross-examine

the persons examined in support of the grounds forming the basis of the
proceedings and where the Assistant Commissioner of Customs or Deputy
Commissioner of Customs declines to examine any person on the grounds
that his evidence is not relevant or material, he shall record his reasons in
writing for so doing.

(5) At the conclusion of the aforesaid inquiry, the Assistant Commissioner

of Customs or Deputy Commissioner of Customs shall prepare a report of
the inquiry recording his findings.

(6) The 1[Principal Commissioner of Customs or Commissioner of Customs,

as the case may be] shall furnish to the Customs Cargo Service provider a
copy of the report of the Assistant Commissioner or Deputy Commissioner
of Customs and shall require the Customs Cargo Service provider to
submit within the specified period not being less than thirty days any
representation that he may wish to make against the findings of the
Assistant Commissioner of Customs or Deputy Commissioner of Customs.

(7) The 1[Principal Commissioner or Commissioner] shall, after considering

the report of the inquiry, and the representation thereon, if any, made by
the Customs Cargo Service provider, pass such orders as he deems fit.
(8) If any Customs Cargo Service provider contravenes any of the
provisions of these regulations, or abets such contravention or who fails to
comply with any provision of the regulation with which it was his duty to
comply, then, he shall be liable to a penalty which may extend to fifty
thousand rupees.

(9) Any Customs Cargo Service provider aggrieved by any decision or

order passed under this regulation, may appeal under section 129A of the
Act to the Customs Central Excise and Service Tax Appellate Tribunal
established under sub-section 1 of section 129 of the Act.