Custom House Agents Licence - An Archaic Relic

By Vijay Kumar

ARE Customs procedures and rules so complicated that ordinary importers cannot fathom the dangerous depths near the docks that you need an agent to get through the corridors of power in the awed Custom Houses in the country? Why agents at all? In the days of liberalisation and simplification and Electronic Data Interface and all such high sounding words, do we still need agents to clear documents in the Custom Houses? Perhaps Customs is the only Central Government department where you have recognised, approved, authorised, nay licensed agents. The dictionary describes agent as negotiator, manager, mediator, representative. Now what is a Custom House Agent? Is he a negotiator between Customs and the customers, if so what does he negotiate? Though not apparent, obvious? If he is a manager, what does he manage? And whose affairs?

Unlike other agents, say a real estate agent or a transport agent where anyone with a little talent or lack of it can join the profession, the Custom House agent is a specialised professional. He has to go through an elaborate selection process which includes a very tough written test followed by a high profile interview. The written test is held on All India basis with question papers being sent to Commissionerates from Delhi with occasional leaks not altogether avoidable. One year the examination had to be postponed because there was a theft of question papers! The standard of the examination is so high that most of the Customs officers would fail in it. Passing the examination is not an automatic gateway to get a licence.

++ In today's high tech fast track world, does the department need the expertise of the Agent?

++ Can't the department survive without an agent?

++ Does the department need the assistance of the agent for clearance? Isn't the department capable of running its own affairs?

++ Are the procedures so complicated that you need an agent to get through Customs?

++ And if the agents are so knowledgeable and competent, why so much litigation?

++ Why the agents never do legal consultancy? If there is any problem with a customs officer, you have an agent to sort it out, but if you have a problem with the Customs Act, you have to go to a lawyer or consultant. If the Custom House Agent is so well versed with the law and procedures, why is he not able to defend his client in judicial forums?

++ And if the job requires so much skill in procedures and law, why is that you never find a retired Customs officer becoming a Custom House Agent? They prefer to become consultants rather than agents.

The fact is that this job does not need and does not attract all that talent - far from it. The laws are not that complicated that you cannot do your own work. Even if the laws are difficult, the Customs should help the importers and exporters in following the procedure.

Over a period of time, the agents who were supposed to facilitate a fast clearance have become a thorn in the Customs rose. The whole system of Custom House Agents is embroiled in controversy and troubles for all concerned. Middlemen don't exactly help in a transaction; they have a tendency of projecting a negative image of both sides. Thus the party is told that the department is awfully corrupt and harmful while the department is told that the party is a big party and “for your own safety, don't act smart”.

The trouble starts with the licence itself. Those who already have the licence do not want to allow others to enter, while those waiting in the wings, believing there is big pie for everyone to share, want to enter at any cost. And here starts the first stage of conflict and of course the much dreaded discretion and discretion in India is said to breed corruption. Officers are accused of corruption and it must be fairly conceded, not always without any basis, in granting and renewing licences. The examination is another great trouble maker. The examination is normally taken by ordinary graduates with no idea of law or procedures and they are expected to answer questions which are difficult even for seasoned departmental officers. Natural corollary is tendency for malpractices, at least the scope for alleging malpractices.

And what do the agents do in the Custom Houses? Do all kinds of sundry jobs for the department. Even files are carried by these agents to various officers. There is an interesting reported case. A case was to be decided by a Deputy Commissioner. The file went to the Commissioner who made some noting and returned to the Deputy Commissioner's office through the agent , yes through the agent. On the way our good agent made a photo copy of the file and later that noting of the Commissioner of which the agent had a photocopy became the basis of an appeal!

Because officers get transferred and agents don't, over a period of time the agents become super powers in the Custom Houses. Because of too much familiarity with the lower staff, they naturally develop, what familiarity breeds - contempt. The agents interfere in the administration of the Custom Houses and even influence transfers. There are powerful agents who are dreaded by officers and who command terrific influence in the Custom Houses. The machine has now become a dreaded Frankenstein. Look at any Custom House scam, you find the role of a Custom House Agent prominent.

Is there any need to continue with such an archaic and troublesome institution? DDT suggests that the Custom House Agents licensing should be abolished. We should be mature enough to handle our job ourselves. I know this suggestion will meet with stiff opposition especially from the agents who have a bloated opinion about their role in the system.

If it cannot be altogether abolished, DDT suggests:-

Remove the MRTP in the system of Custom House Agents. Let there be no discretion in selection and the number of agents that can be allowed. Every person who is eligible and qualified should be given a licence. At least competition will drive away many evils.

And why there is no Central Excise or Service Tax Agents Licence?