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Customs Duty – Import & Export Compliance

Who Files This?

Any importer or exporter of goods/services is required to comply with customs duty regulations and file relevant declarations/forms with the Customs Department (CBIC).

This applies to:

  • Importers bringing goods into India.

  • Exporters sending goods outside India.

  • Businesses availing duty exemption schemes (EPCG, Advance Authorization, SEZ, etc.).

Applicability Criteria

Customs Duty is levied on:

  • Imports: Goods brought into India from outside the country.

  • Exports: Certain goods exported from India (mostly limited items, as India encourages exports).

Types of duties applicable may include:

  • Basic Customs Duty (BCD).

  • IGST on imports (in place of CVD/SAD post-GST).

  • Social Welfare Surcharge.

  • Anti-dumping or Safeguard Duty (if notified).

  • Export Duty (on specified goods).

Why It Matters

Customs duty compliance ensures:

  • Legal clearance of goods through ports and airports.

  • Proper valuation, classification, and duty payment.

  • Avoidance of detention, penalties, and confiscation.

  • Availment of exemptions under trade agreements (FTA/ASEAN, etc.) and export incentives.

Process of Filing

  1. Import–Export Code (IEC) registration with DGFT (mandatory).

  2. Classify goods under HSN (Harmonized System of Nomenclature).

  3. File Bill of Entry (for imports) or Shipping Bill (for exports) electronically via ICEGATE portal.

  4. Pay applicable customs duty (if any) online.

  5. Obtain customs clearance after assessment, examination, and out-of-charge order.

  6. Maintain records for audits and DGFT/RBI compliances (where foreign exchange is involved).

Documents Required

  • Import Export Code (IEC).

  • Commercial Invoice & Packing List.

  • Bill of Lading / Airway Bill.

  • Bill of Entry (Imports) / Shipping Bill (Exports).

  • Insurance Certificate (if applicable).

  • Certificate of Origin (for preferential tariff under trade agreements).

  • Duty payment challan.

Due Dates

  • Duty is payable at the time of filing Bill of Entry (imports) or Shipping Bill (exports).

  • Returns under specific schemes (EPCG, Advance License, SEZ) must be filed as per scheme timelines with Customs/DGFT.

Penalty for Non-Compliance

  • Late filing of Bill of Entry: Penalty up to ₹5,000 per day.

  • Wrong classification/undervaluation: Penalty up to 100% of duty sought to be evaded, plus confiscation of goods.

  • Non-payment of duty: Interest @ 15% p.a. plus penalty.

  • Fraudulent filings: Prosecution and imprisonment in serious cases.

How Law to Corporate (LTC) Helps

  • IEC registration and advisory on trade compliance.

  • Assistance in classification & valuation of goods to optimize duty.

  • Preparation and filing of Bill of Entry / Shipping Bill.

  • Advisory on FTA benefits, exemptions, and export incentives.

  • Representation before Customs Authorities in case of disputes.