Amount of bond and bank guarantee and insurance under Regulation 5(1)(iii) of HCCAR, 2009 - CBEC Circular
IT has been represented to the Board that the amount of insurance under Regulation 5(1)(iii) of Handling of Cargo in Customs Area Regulations (HCCAR), 2009 should be based on amount of Customs duty associated with goods likely to be stored at a particular time and not on the projected capacity. Attention of the Board has also been drawn to the requirement of annual revalidation of the carrier bond given by the Customs Cargo Service Providers (CCSPs) i.e. ICDs/CFSs for the movement of goods from the gateway ports (to the ICDs/CFSs) in terms of Goods Imported (Conditions of Transhipment) Regulations, 1995. It is contended that the annual revalidation is cumbersome.
Board has examined the matter and has decided:-
That the amount of insurance to be provided by CCSPs should be equal to the average value of goods likely to be stored in the Customs area, for a period of 30 days (based on projected capacity), and for an amount as Commissioner of Customs may specify having regard to the goods that are already insured by the importers or exporters .
As regards the validity of the carrier bond, as a simplification measure, Board has decided that the carrier bond executed by CCSPs i.e. ICDs/CFSs shall have a validity period of 2 years or 5 years, as the case may be. (New CCSPs are approved initially for 2 years, which is renewed for 5 years at a time, while existing CCSPs are straightaway approved for 5 Years.)
CBEC Circular No. 32/2013-Cus., Dated: August 16, 2013