Disposal of Unclaimed Uncleared Cargo
Disposal of Unclaimed/Uncleared Cargo
Procedure for sale of unclaimed/uncleared goods:
Apportionment of sale proceeds of goods:
Disposal of Unclaimed/Uncleared Cargo
The imported goods are allowed to be cleared for home consumption by the
Customs, if there are no restrictions or prohibitions, the assessment
formalities have been completed and the duty leviable has been paid by the
importers. It is often noticed that the importer files the bill of entry but
does not clear the goods due to various reasons such as financial problems, lack
of demand for the goods, etc. Such goods are called 'uncleared goods'. In some
cases, the importer does not even come forward to file the bill of entry for
clearance of goods. Such goods are known as 'unclaimed goods'.
- In terms of the provisions of the Customs Act, 1962, the duty is
leviable on imported goods, regardless of whether they are cleared by the
importers or not. Similarly, dues of other agencies, such as, carriers and
custodians for carriage and storage of goods respectively, may also arise.
Where the importers do not come forward to make payment of such dues, the
Customs duty and other dues can be recovered by selling the unclaimed/uncleared
goods.
- As per section 48, if any goods brought into India from a place outside
India are not cleared for home consumption or warehoused or transhipped
within 30 days from the date of unloading thereof at a port, such goods can
be disposed of by the custodian. The Act, however, stipulates that the goods
can be sold only after a notice is issued to the importer and the permission
of the Customs is obtained. The provisions relating to manner of disposal of
unclaimed/uncleared goods and apportionment of sale proceeds thereof are
contained in sections 48 and 150 of the Customs Act, 1962.
Procedure for sale of unclaimed/uncleared goods:
- For sale of such unclaimed/uncleared goods, the custodian first
identifies the goods which are lying uncleared for more than 30 days. He
then prepares an inventory of such goods and sends it to the Customs for
their 'no objection'. The Customs scrutinizes the list of consignments
forwarded by the custodians and withdraws the items which are the subject
matter of any investigation/adjudication or court proceedings. The goods
prohibited for import, are also withdrawn from the auction as these are
subject to adjudication proceedings and goods may get absolutely
confiscated. Once goods are confiscated, the ownership is transferred to the
Government and the Customs becomes responsible for disposal of such goods.
Disposal of certain items such as drugs/pharmaceuticals, chemicals,
foodstuffs, insecticides, fertilizers, etc., also requires clearance from
the respective authorities regulating import of these items.
- Once 'no objection' for disposal is received from the Customs, the
custodian gets the fair price of the goods determined by Customs. The price
approved by the Customs (inclusive of duty leviable) generally forms the
basis of 'reserve price' for the purpose of auction of the goods.
- After fixation of reserve price, the custodians arrange public auctions
which are held in the presence of proper officer of Customs. In the event of
the goods not being disposed of at the 'reserve price' (or within the
permissible margin) in the first auction, the 'reserve price' is reduced
according to prescribed scale in the subsequent auctions. In case, efforts
to sell the goods through public auction fail, these are sold through
tender.
- Once the goods are sold, the Customs duty on the goods is calculated.
For calculation of Customs duty, the sale proceeds from sale of unclaimed/uncleared
goods is taken as cum duty price (value + duty) and customs duty is
calculated working backwards on the price realised.
Apportionment of sale proceeds of goods:
- On the unclaimed/uncleared goods, liabilities towards Customs duty as
well as carrier's charges and storage charges arise, which are to be
recovered from the sale proceeds. In addition, sales expenses incurred on
sale of such goods are to be recovered. In most of the cases, the sale
proceeds of such goods may not be sufficient to meet liabilities of all the
agencies. In such cases, question arises as to which liability is to be met
first. To take care of such a situation, provisions have been made in
section 150(2) of the Customs Act. Thesale proceeds of any such sale of
unclaimed/uncleared goods is to be applied in following manner:-
- first, to the payment of the expenses of the sale,
- next to the payment of the freight and other charges, if
any, payable in respect of the goods sold, to the carrier, if
notice of such charges has been given to the custodians.
- next to the payment of the duty, if any, on the goods sold,
- next to the payment of the charges in respect of the goods
sold due to the person having the custody of the goods,
- next to the payment of any amount due from the owner of the
goods to the Central Government under the provisions of this Act
or any other law relating to Customs,
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After making above-said payments, if any balance remains, that is to be paid
to the owner of the goods.