The Central Board of Indirect taxes and Customs (CBIC) issued the instructions on the verification of the Preferential Certificates of Origin in terms of Customs (Administration of Rules of. Origin under Trade Agreements) (CAROTAR) Rules, 2020.
As per the CAROTAR rules, in case the assessing officer has some doubt on the validity of the certificate of origin, he can contact the free trade agreement (FTA) cell of CBIC which in turn will contact the exporting country’s authority.
The CBIC in a letter to field units said that enquiries on the origin of imported goods should be raised only where there are ‘sufficient grounds’ to suspect origin of a good, or where the same has been identified as a risk by the risk management system.
The Board has received representations from trade on difficulties being faced on account of multiple queries or importers being asked to directly seek clarifications from the issuing authorities of the exporting country.
“They should be suitably supervised to ensure that unnecessary queries are not raised on account of goods origin,” the CBIC said.
“It is observed that a significant number of such requests have to be returned on account of being deficient, thus leading to delay in verification process and adversely impacting trade facilitation,” the Board said.
In some cases, scanned documents were found to be illegible, certificates were being sent without requisite covering letter to indicate nature of request and bulk certificates were being sent rather than specific ones.
“Some requests do not appear to merit verification,” it said, such as in cases where the name of issuing authority is not available, even in cases where same is not mandated as per that specific trade agreement, or specimen seal and signatures are not available for cases where same has already been communicated by the Board.
Therefore, this is a smart move on the part of the government as this will not only prevent revenue leakage but will also ensure that the shipments are not unnecessarily delayed at customs ports.
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