Self sealing of containers

Backdrop

Earlier in the Pre-GST Regime, there were three ways through which the sealing of containers would take place. These were namely:

Containers stuffed at factory premises or warehouses under self sealing procedure.
Containers stuffed/sealed at factory premises or warehouse under supervision of Central Excise officer.
Containers stuffed and sealed at Container Freight Stations/Inland Container Depots.

For the ease of business, the provision of sealing of containers under the supervision of central excise officer has been done away with by the Board. Thus, the exporters registered under GST law and filing Returns can follow the procedure of self sealing of containers.

The procedure for self sealing of containers are herewith enumerated :

Exporter should be registered under GST and should file relevant returns.
The exporter should intimate to the Jurisdictional Customs Officer, the details of the premises where container stuffing will be carried out. Any exporter desirous of availing this procedure shall inform the Superintendent or Appraiser of Customs, at least 15 days before the first planned movement of a consignment from his/her factory/ premises.
The jurisdictional Superintendent or Inspector of Customs shall inspect the premises (where the exported goods will be stuffed and sealed for export) with regard to viability of stuffing of container in the premises and submit a report to the appropriate Jurisdiction within 48 hours.
The appropriate Jurisdiction will then forward their report on findings to the Principal Commissioner/Commissioner of Customs who would then grant permission for self-sealing at the approved premises. Once the permission is granted, the exporter shall furnish only intimation, mentioning place and address of the approved premises, description of export goods and whether or not any incentive is being claimed, to the jurisdictional Superintendent or Customs each time self-sealing is carried out at approved premises.
Once, Principal Commissioner/Commissioner of Customs permits for Self-Sealing, it shall be valid for exports at all the customs stations.
Transport document prescribed under the GST Laws shall be applicable for the movement of self-sealed container from factory or warehouse.
For a Non-GST registrant exporter, way bill or transport challan or lorry receipt shall be the transport document.
The exporter shall seal the container with the tamper proof Electronic-seal of standard specification.

The procedure for Electronic Sealing of Containers under self sealing are herewith enumerated:

The new Self –Sealing procedure shall come into effect from 01.10.2017.

Specification required for Electronic seal:

An electronic seal is a RFID tamper proof one-time bolt seal bearing a unique serial number and brand of the vendor in the format of 12 alpha numeric characters i.e. ABCD XXXX XXXX, where the first four characters stands for the brand of the vendor and the last 8 digits are numerical digits showing the unique id.

Such seals are to be procured by the exporters themselves at their own costs. Moreover, the seals should confirm to ISO as specified in the circular.

Usage of E seal:

The Vendor will provide the standard web application necessary to support an RFID self-sealing ecosystem which will be given at the time of purchase of RFID Seal. Further the information required to be furnished by the exporters viz. IEC, Shipping Bill No. & Date, E-Seal No. & date, Time of Sealing etc. to be tagged to the seal using a web/ mobile application which will also be provided by the vendor.

Declarations to be made by Exporters:

In case of online Shipping Bill: The exporter will be required to declare the physical serial number of the e-seal at the time of filing the online integrated shipping bill.
In case of Manual Shipping Bill: Before the container is dispatched for the designated port/ICD/LCS.

Administration of such seals:

All vendors of the Electronic Seal should submit the certification of such seals to the Risk Management Division (RMD). Further, the vendor shall also submit self-certified copies of such certification to all the ICDs/Port where exporters intend to operate along with the unique series of the seals proposed to be offered for sale.

All vendors shall also be required to make arrangements for reading, scanning of RFID one – time Bolt seals at the customs port at their own cost whether through handheld readers or fixed readers.

The integrity of the RFID seal would be verified by the customs officer at the port by using the reader scanner which are connected to Data Retrieval System of the vendor.

Caution

Data once uploaded by the exporter will not be capable of being overwritten or edited in the Electronic Seal.
If the RFID seals are found to be tampered then mandatory examination would be carried out by the Customs Authorities.

Sealing of containers at Container Freight Stations/Inland Container Depot:

It is applicable for:

The exporter not registered under GST, except in case of Status Holders.
The case where permission for self-stuffing is denied by the Jurisdictional Deputy/ Additional Commissioner of Customs.

In the above mentioned cases the exporters would require to get the goods to be exported, sealed through at Container Freight Stations(CFSs)/Inland Container Depot(ICDs).

Conclusion

With the onset of GST, the existing procedures relating to stuffing of containers at the factory under the supervision of Central Excise Officer has been done away with. The revised self sealing procedure shall come into force from 1/10/2017. Till then the existing procedure of sealing of containers with a bottle seal under Central Excise supervision would continue.

¹Circular No. 26/2017-Customs

² Circular No. 36/2017- Customs

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BT Associates, India

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Twenty years of experience in tax practice. Specialist in structuring & planning and tax optimization under indirect tax. Lead eastern India indirect tax practice of Ernst & Young in past.