INDIA: Undertakings to Replace Customs Bonds On Temporary Basis
18 May 2021
The requirement for traders to furnish bonds to customs authorities when importing or exporting goods has now been relaxed. According to Circular No 9/ 2021, as issued by the country’s Central Board of Indirect Taxes and Customs (CBIC), the move forms part of a bid to speed up the clearance of goods and maintain a balance between customs control and the streamlining of legitimate trade. The bond suspension will take effect immediately and remain in force until 30 June. The CBIC move follows numerous representations from businesses requesting that undertakings should replace bonds given the customs clearance difficulties arising from the ongoing lockdowns in many parts of India.
In effect, the circular reintroduces the bond waiver that was adopted in April 2020 by Circular No.17/2020-Cus, which specified many of the same terms and conditions. As with that earlier legislation, an undertaking will be acceptable in place of a bond, although the CBIC has emphasised that this is a temporary measure and all such undertakings will need to be upgraded to bonds on or before 15 July this year.
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