SCHOOL OF ECONOMICS

DAVV, Indore

Summer Internship Report On

“Export-Procedure & Documentation”

With Reference To

Nimbus Shipping Services Pvt. Ltd.

In partial fulfillment of MBA in International

Business for the Academic year 2017-2019

Submitted To: Submitted By:

Dr. Akanksha Singhi Mam Pankaj Kumar
M.B.A. (I.B) III Sem.

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 TABLE OF CONTENT

SL. NO. PARTICULARS PAGE NO.

1. Internship certificate 3
2. Declaration 4
3. Acknowledgement 5
4. Executive Summary 6
5. Preface 7
6. Industrial Profile 8-9
7. Company Profile 10-31
8. Structure of organisation 32
9. Major Learning 33
10. SWOT Analysis 34
11. Recommendations 35
12. Bibliography 36

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CERTIFICATE

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 DECLARATION

I Pankaj Kumar (MBA, IB) hereby declare that the study entitled “The documentation part (Export
Procedure & documentation)”is being submitted by me in the partial fulfillment of the requirement for the
award of Masters of Business Administration in International Business. The study was conducted at
Nimbus Shipping Services Pvt. Ltd.

The matter provided by me in this project report is my original framework and has not been copied from
anywhere. I take full authority of the matter provided by me.

PANKAJ KUMAR

MBA(IB) 3rd Sem.

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 Acknowledgement

The situation and euphoria that accompany the successful completion of the project would be incomplete
without the mention of the people who made it possible.

I would like to thank Mr. Anil Kumar Rai sir who inspite of busy schedule has co-operated with me
continuously and indeed, his valuable contribution and guidance have been certainly indispensable for my
project work.

I owe my wholehearted thanks and appreciation to the entire staff of the company for their cooperation and
assistance during the course of my project.

I hope that I can build upon the experience and knowledge that I have gained and make a valuable
contribution towards this industry in coming future.

PANKAJ KUMAR

MBA (IB) 3rd Sem.

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 EXECUTIVE SUMMARY

The objective of the project was “To understand the documentation required in export ”.

The following project report is on the summer internship undertaken by me at Nimbus Shipping Services Pvt.
Ltd. The project started on 25 th of May 2018 and ended on 15th July 2018 where I came to know about all
the relevant information regarding the project, under the guidance of Mr.Anil Kumar Rai sir.

All the documents relating to export of the goods are mentioned in this report. Certificate of origin, bill of
lading, shipping bill, export procedure are included.

PANKAJ KUMAR

MBA (IB) 3rd Sem.

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 PREFACE

On job training forms an integral part in the curriculum of MBA students who are required to undergo
training in a reputed corporate house. It is designed to know business environment and situations. It helps
students in applying their theoretical concepts to gain valuable insight of corporate and system.

I undertook my training in Nimbus Shipping Services Pvt. Ltd, 602, 6th floor, Silver arc Plaza, New
Palasia, Indore. Duration of my training was of 50 days. During my training period I spend my major time
in understanding the required documentation for Export.

This project report is a summary of all functions and knowledge, I gathered during my training period.

AN ERROR AND OMISSION THAT MIGHT HAVE OCURRED ARE TOTALLY

UNINTENTIONAL AND I EXPRESS MY APOLOGY FOR THE SAME.

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 INDUSTRY PROFILE

Who is a freight forwarder?

“A freight forwarder is a company that arranges your importing, exporting of goods.”

Freight forwarder company is a firm specializing in arranging storage and shipping of merchandise on
behalf of its shippers. It usually provides a full range of services providing tracking inland transportation,
preparation of shipping and export documents, warehousing, booking cargo, negotiating freight charges
and consolidation, cargo insurance and filling of cargo claims. Freight forwarders usually ship under their
own bill of lading or air way bills.(called house bill of lading or house airway bill) and there agents or
associates at the destination (overseas freight forwarders) provide document delivery, deconsolidation ,
and freight collection services. Also called forwarder.(A freight forwarder is a agent who acts on behalf of
importers, exporters or other companies to organize the safe, efficient and cost effective transportation of
goods).

Freight forwarders use computer systems to arrange the best way of transport, taking into account the type
of goods of delivery requirements. They use the services of shipping lines, air lines and road and rail
freight operaters.

CUSTOM HOUSE AGENT

A Custom’s House Agent, or CHA, is hired by a company to act on company’s behalf in importing and/or
exporting goods. This releases the company from having to tangle with the often stringent and complicated
laws of importing and exporting.

The CHA is given legal authority to make decisions regarding the company’s goods that go through customs.
Although a company is not required to hire a CHA, this person is helpful in dealing with the customs process.

CHA would perform all the actions required to get your goods through customs. This includes:

-Filling out and shipping a bill of entry.

-Submitting supporting documents for the bill of entry.

-Helping with the examination of goods.

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-Providing warehouse space for a company’s goods and removing those goods at the appropriate time.

-Making a payment of duty on behalf of the company.

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 CHAPTER-1

ABOUT THE COMPANY

1.1 INTRODUCTION

Nimbus Shipping Services Pvt. Ltd. is offering Complete Logistics Solutions for all types of cargo with the
Best & Most competitive freight rates, International Freight Forwarder, LCL Consolidation, Domestic
Transportation, Door-to-Door Delivery, Warehousing, Packing, Custom Clearance, Agency Certification,
Licensing Services, Exim Trade Consultant and Insurance. A large number of customers trust their devotion
towards speed, flexibility and ingenuity, while managing the services that they provide. They have developed
strong relationships with customers and carriers across the globe and take pride in being one of the most
resilient resources in the transportation industry.

They handle all normal cargos and heavy, over-sized, or otherwise unconventional cargo so that it arrives on
time anywhere in the world. Their strong network can help to speed your cargo movement and
knowledgeable staff can give you the quickest possible response to all your inquiries.

1. Fully integrated international freight and logistics services by Air, Sea and Road.
2. Real-time-web-enabled tracking and tracing interfaced with supply chain partners.
3. Expert assistance in cargo insurance, permits and regulatory obligations.

Network of worldwide offices provide fully integrated global logistics services, including customs brokerage,
warehousing, distribution, and inventory management.

NIMBUS Shipping's combination of global reach and local knowledge is a key competitive edge. They offer
a wide range of standardized services as well as tailor-made industry solutions. This is the only way to
deliver to the high standards that our global customers are demanding.

1.2 OUR MISSION

Nimbus Shipping Service is a Freight Forwarding and Custom House Agent Company dedicated to Service
and Customer Satisfaction. We seek to excel in freight forwarding and to be the Leading freight forwarding
company in all regions of World.

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Our Mission at Nimbus Shipping Service is to provide Superior Customer Satisfaction beyond the average
level of expectation.

1.3 OUR VISION

To Become the Leading logistics Service provider with Global Presence.

1.4 BASIC INFORMATION

Nature of Business- Service Provider

Company CEO- Anil Kumar Rai

Legal Status of Firm- Private Limited Company

1.5 SERVICES

Sea Freight Services

Nimbus promises a safe and on-time transportation to customers via SEA. We offer Premium Services for
FCL and LCL.

Air Freight

Nimbus provides tailored programs to all sizes of goods for our customers. Our airfreight service guarantees
a safe and on-time transportation.

Road Transport Services

Our comprehensive network allows us to meet our customer requirement, and we also provide a safe and on-
time transportation for our customers.

Warehousing

Our Warehousing services help you reduce overheads, increase efficiency and cut down distribution time.
Our services include: Storage, consolidation, repacking, documentation, labeling, invoicing, finished and
spares inventory management, distribution and service support, cross talking are all services provided if
required.
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Door-to-Door Delivery

If a cargo needs to be sent across the nation, we will ensure it reaches safely. Our group of professionals will
take care of computers, product samples, spare parts, prints etc. These door to door services are perfect for
large consignments (just-in-time goods, multi-parcels etc) of a variety of weights. Our services are of the
highest quality at competitive prices. Additionally, we also provide effective supply-chain managerial
services.

1.6 CUSTOM HOUSE AGENT

A Custom’s House Agent, or CHA, is hired by a company to act on company’s behalf in importing
and/or exporting goods. This releases the company from having to tangle with the often stringent and
complicated laws of importing and exporting.

The CHA is given legal authority to make decisions regarding the company’s goods that go through customs.
Although a company is not required to hire a CHA, this person is helpful in dealing with the customs process.

CHA would perform all the actions required to get your goods through customs. This includes:

-Filling out and shipping a bill of entry

-Submitting supporting documents for the bill of entry.

-Helping with the examination of goods

-Providing warehouse space for a company’s goods and removing those goods at the appropriate time.

-Making a payment of duty on behalf of the company

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 CHAPTER-2

Export Procedure & Documentation

2.1 Bill of Lading:

The bill of lading is a document issued by the shipping company or its agent acknowledging the receipt of
goods on board the vessel and undertaking to deliver the goods in the like order and condition as received, to
the consignee or his order, provided the freight and other charges as specified in the bill have been duly paid.
It is also a document of title to the goods and as such, is freely transferable by endorsement and delivery.

A bill of lading normally contains the following details:

 The name of the company.

 The name and address of the shipper/exporter.
 The name and address of the importer/agent.
 The name of the ship.
 Voyage number and date.
 The name of the ports of shipment and discharge.
 Quality, quantity, marks and other descriptions.
 The number of packages.
 Whether freight paid or payable.
 The number of originals issued.
 The date of loading of goods on the ship.
 The signature of the issuing authority.

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

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2.2 Airway Bill:

An air waybill (AWB) or air consignment note is a receipt issued by an international airline for goods and an
evidence of the contract of carriage, but it is not a document of title to the goods. Hence, the air waybill is
non-negotiable.

The air waybill is the most important document issued by a carrier either directly or through its authorized
agent. It is a non-negotiable transport document, that covers transport of cargo from airport to airport.

Air waybills are issued in 8 sets of different colors. The first three copies are classified as originals. The first
original, green in color, is the Issuing Carrier's copy. The second, colored pink, is the Consignee's Copy. The
third, colored blue, is the Shipper's copy. A fourth brown copy acts as the Delivery Receipt, or proof of
delivery. The other three copies are white.

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 2.3
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Shipping Bill:

2.3 Shipping Bill:

Shipping bill is an important document required by the custom authority for allowing shipment. It is prepared
by the exporter and it contain the name of vessel, masters or agents, port at which the goods is to be
discharged, country of final destination, exporter’s name and address, details about packages, number and
description of goods, marks and numbers, quantity, detail about each case.

Shipping bill is normally prepared in 5 copies:

 Custom copy
 Drawback copy
 Export promotion copy
 Port trust copy
 Exporters copy

2.4 Bill Of Entry:

Bill of entry is a document prepared by the importer or his clearing agent in the prescribed form, on the
strength of which clearance of imported goods can be made.

When goods are imported in a particular company, the importer has to pay the necessary import duty. For
this purpose necessary information about the goods imported must be given to the custom authority in a
prescribed form called bill of entry form. Bill of entry is document which states that the goods of the stated
value and description in the specified quality have entered into the country from abroad. It is drawn in
triplicate. The custom authorities may ask the importer to supply other documents like invoice, broker’s note
and insurance policy, etc. in order to verify the correctness of the information supplied in bill of the entry
form.

2.5 Contents of Bill Entry:

1. Name and address of importer.

2. Name of address of exporter.

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 3. Import license number of the importer.
4. Name of the port/dock where goods are to be cleared.
5. Description of goods.
6. Value of goods.
7. Rate and amount of import duty payable.
8. Other relevant documents.

2.6 Commercial Invoice:

Commercial invoice is the basic and most important document in export transaction. It is also known as
‘Document Of Contains’ as it contains all the information required for the preparation of other documents. It
is prepared by exporter after the execution of export order giving details about the goods shipped. It is
essential that the invoice is prepared in the name of buyer or the consignee mentioned in the letter of credit.

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2.7 Contents of Commercial invoice:

1. Name and address of the consignee.

2. Name and no. of vessel or flight.
3. Name of port of loading.
4. Name of the port of discharge and final destination.
5. Invoice no. and date.
6. Exporters reference number.
7. Buyers reference no. and date.
8. Name of country of the origin of goods.
9. Name of the country of final destination.
10. Terms of delivery and payment.
11. Marks and container number.
12. Number and packing description.
13. Description of goods giving details of quantity, rate & total amount in terms of internationally
accepted price quotation.
14. Signature of the exporter with date.

2.8 Certificate of Origin:

A certificate of origin (co) is a document which is used for certification that the products exported wholly
obtained, produced or manufactured in India. It is required when:

 Goods produced in a particular country are subject to preferential tariff rates in the foreign market at
the time of importation.
 The goods produced in particular country market.

2.9 Contents of Certificate of origin:

1. Name and logo of chamber of commerce.

2. Name and address of the consignee.
3. Name and address of exporter.
4. Name and no. of vessel or flight.
5. Name of port of loading.
6. Name of the port of discharge.
7. Marks and container number.
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 8. Number and packing description.
9. Description of goods giving details of quantity.
10. Signature of the exporter with date.
11. Signature and initials of the concerned officer of the issuing authority.
12. Seal of the issuing authority.

2.10 Packing List /Note:

A packing list should include the date of packing connecting invoice number. Order number, details of
shipping such as the steamer, bill of lading number and date of sailing, case number to which the list/note
relates details of goods such as quantity and weight and/or item-wise details.

Normally twelve copies of packing list should be prepared. The first is to be kept inside the package, four
copies to be sent with shipping documents, three copies to the buyer. Two copiesto the shipping agent and
the remaining retained by the exporter.

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2.11 Letter of Credit:

A letter of credit is a method of payment that is an important part of international trade. They are particularly
useful where the buyer and seller may not know each other personally and are separated by distance,

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differing laws in each country and different trading customs. It is generally considered that Letters of Credit
offer a good balance of security between the buyer and the seller, because both the buyer and seller rely upon
the security of banks and the banking system to ensure that payment is received and goods are provided. In a
Letter of Credit transaction the goods are consigned to the order of the issuing bank, meaning that the bank
will not release control of the goods until the buyer has either paid or undertaken to pay the bank for the
documents.

 The Advising Bank is the bank that will inform the Beneficiary or their Nominated Bank of the
credit, send the original credit to the Beneficiary or their Nominated Bank, and provide the
Beneficiary or their Nominated Bank with any amendments to the letter of credit.
 The Applicant is the person or company who has requested the letter of credit to be issued; this will
normally be the buyer.
 The Beneficiary is the person or company who will be paid under the letter of credit; this will
normally be the seller.
 A Complying Presentation is a set of documents that meet with the requirements of the letter of
credit and all of the rules relating to letters of credit.
 Confirming Bank is a bank other than the issuing bank that adds its confirmation to credit upon the
issuing bank's authorization or request thus providing more security to beneficiary.
 The Issuing Bank is the bank that issues the credit, usually following a request from an Applicant.
 The Nominated Bank is a bank mentioned within the letter of credit at which the credit is available.

CHAPTER-3

INCO TERMS

The Incoterms rules or International Commercial Terms are a series of pre-defined commercial terms
published by the International Chamber of Commerce (ICC) relating to international commercial law. They
are widely used in International commercial transactions or procurement processes as the use in international
sales is encouraged by trade councils, courts and international lawyers.

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The Incoterms rules are accepted by governments, legal authorities, and practitioners worldwide for the
interpretation of most commonly used terms in international trade. They are intended to reduce or remove
altogether uncertainties arising from different interpretation of the rules in different countries. As such they
are regularly incorporated into sales contracts worldwide.

TERMS FOR ALL TRANSPORT MODE

EXW - Ex Works -- Risk pass to buyer including payment of all transportation and insurance cost from the
seller's door. Used for any mode of transportation.

FCA - Free Carrier -- Risk pass to buyer including transportation and insurance cost when the seller
delivers goods cleared for export to the carrier. Seller is obligated to load the goods on the Buyer's collecting
vehicle; it is the Buyer's obligation to receive the Seller's arriving vehicle unloaded.

CPT - Carriage Paid To -- Risk and insurance cost pass to buyer when delivered to carrier by seller who
pays transportation cost to destination. Used for any mode of transportation.

CIP - Carriage and Insurance Paid To -- Risk pass to buyer when delivered to carrier by seller who pays
transportation and insurance cost to destination. Used for any mode of transportation.

DAT - Delivered At Terminal -- Risk pass to buyer when seller delivers and unloads goods at named
terminal. Used for any mode of transportation.

DAP - Delivered At Place -- Risk pass to buyer when seller delivers goods to named place ready for
unloading. Used for any mode of transportation.

DDP - Delivered Duty Paid -- Risk pass to buyer when seller delivers goods to named destination point
cleared for import. Used for any mode of transportation.

TERMS FOR SEA/INLAND WATERWAY TRANSPORT ONLY

FAS - Free Alongside Ship -- Risk pass to buyer including payment of all transportation and insurance cost
once delivered alongside ship by the seller. Used for sea or inland waterway transportation. The export
clearance obligation rests with the seller.

FOB - Free On Board -- Risk pass to buyer including payment of all transportation and insurance cost once
delivered on board the ship by the seller. Used for sea or inland waterway transportation.
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CFR - Cost and Freight -- Risk and insurance cost pass to buyer when delivered on board the ship by seller
who pays the transportation cost to the destination port. Used for sea or inland waterway transportation.

CIF - Cost, Insurance and Freight -- Risk pass to buyer when delivered on board the ship by seller who
pays transportation and insurance cost to destination port. Used for sea or inland waterway transportation.

CHAPTER-4

EXPORT PROCEDURE

Export Procedure

· Registration Stage.

· Shipment Stage.

· Pre-shipment Stage.

· Post-shipment Stage.

Registration Stages

The exporter is required -to register his organisation with a number of institutions and authorities, which
directly or indirectly help him in the smooth conduct of export, trade. The registration stage includes:-

a) Registration of the Organization: - The form of organization selected by the exporter must. Be
registered under the appropriate Act of. the country.
 A joint stock company under the Companies Act, 1956.
 A partnership firm under the Indian Partnership Act, 1932.
 A sale trader should seek permission from the local authorities, as required.

b)Opening-Bank Account: - The’ exporter should open a current account in the name of the firm or
company with a commercial bank which is authorized by the Reserve Bank of India (RBI) to deal in foreign
exchange. Such bank also serves as a source of pre-shipment and post-shipment finance for the exporter.

c) Obtaining Importer-Exporter Code Number (lEC. No.): - Prior to 1.1.1997, it was obligatory for every
exporter to obtain CNXnumber from the RBI. However, since then, IEC number issued by the Director
General for Foreign Trade (DGFT) has replacedthe CNX number. Theapplication form for obtaining IEC
number should be accompanied by fee of Rs.1000.

d)Obtaining Permanent Account Number- (PAN): Export income is subject to a number of exemptions
and deductions underdifferent sections of the Income Tax Act. For claiming such exemptions and deductions,
the exporter should register hisorganization with the Income Tax Authorities and obtain the Permanent
Account Number (PAN).
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e) Obtaining Sales Tax Number: - Exportable goods are exempted from sales tax, provided, the ‘exporter
or his firm is registeredwith the Sales Tax Authorities. , For this purpose, the exporter is required to make an
application in the prescribed form to the’ Sales Tax Office (STO) in whose jurisdiction his {exporter’s).
Office is situated

f) Registration with, Export Promotion Council(EPC):It is obligatory for every exporter to,register with
theappropriate Export Promotion Council (EPC) and obtain the ‘Registration-cum-Membership Certificate’
(RCMC). The benefitsprovided in the current EXIM Policy are extended only to the registered exporters
having valid RCMC.

g)Registration with ECGC: - The exporter should also register with the Export Credit and Guarantee
Corporation of India (ECGC)in order to secure overseas paymentsagainst political and commercial risks. It
also helps the exporters in obtaining the financial assistance from commercial banksand other financial
institutions.

h)Registration with other Authorities: - The exporter should also register with various other authorities,
such as: -· Federation of Indian Export Organization (FIEO),· Indian Trade Promotion Organization (ITPO),
· Chambers of Commerce(COC), · Productivity Councils, etc.

Shipment Stages

Export, cargo can be exported to the overseas buyer by sea, air or land. However, shipment by sea is the most
popular andgenerally resorted to, as it is comparatively cheaper. Besides, the ship’s capacity is far greater
than other modes of transportation. Nevertheless, transportation by air is utilized for export of expensive
items like, diamonds, gold, etc. Theshipment stage includes the following steps

a) Reservation of Shipping Space: - Once the export contract is finalized, the exporter reserves the required
space in the vesselfor shipment. On accepting the exporter’s request,the shipping company issues a Shipping
Order. The original copy of the shipping order as given to the exporter and the duplicateinstruction by the
shipping company to the commanding officer of the ship that the goods as per the details given should
bereceived on board.

b) Arrangement of Internal Transportation up to the Port of Shipment:-The exporter makes necessary

arrangements for transportation of goods to the port either by road or railways. On loading goods into the
railway wagon, the railway authoritiesissue a ‘Railway Receipt’, which may be either ‘freight paid’ or
‘freight to pay’. It serves as a title to the goods. The exporterdoses the railway receipt in favor of his agent to
enable him to take delivery of the goods at the port of shipment.

c) Preparation and Processing of Shipping Documents :- As the goods reaches the port of shipment, the
exporter should issuedetailed instructions to the C&F agent for theshipment of cargo along with a complete
set of the documents listed below:-

· Letter of Credit along with the export contract orexport order.

· Commercial Invoice (2 copies)

· Packing List or Packing Note.

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· Certificate of Origin.

· GR Form (original and duplicate)

· Certificate of Inspection, where necessary (original copy)

· Marine Insurance Policy.

d) Customs Clearance: - The cargo must be cleared from the Customs before it is loaded on the ship. For
this, the abovementioned documents, along with five copies of shipping bill, are to be submitted to the
Customs Appraiser at the CustomsHouse. The Customs Appraiser ensures that all the formalities relating to
exchange control, quality control, pre-shipment inspection and licensing have beencomplied with by the
exporter. After verification, alldocuments, except the original GR, original copy of Shipping Bill and one
copy of Commercial Invoice, are returned to the C&Fagent.

e) Obtaining ‘Carting Order’ from the Port Trust Authorities: - The C&F agent, then, approaches the
Superintendent of theconcerned Port Trust for obtaining the ‘Carting Order’ for moving the cargo inside the
dock. After obtaining the Carting Order, the cargo is physically moved into the port area andstored in the
appropriate shed.

f) Customs Examination and Issue of ‘Let Export Order’: - The Customs Examiner at the port of
shipment physically examines thegoods and seals the packages in his presence.The same can be arranged for
at the factory or warehouse of the exporter by making an application to the Assistant Collector of Customs.
The Customs Examiner, if satisfied, issues a formal permission I’ for the loading of cargo on the ship in the
form of a ‘Let Export Order.

g) Obtaining ‘Let Ship Order’ from the Customs Preventive Officer: - ‘Let Export Order’ must be
supplemented by a ‘Let ShipOrder’ issued by the Customs Preventive Officer.The C&F agent submits the
duplicate copy of Shipping Bill, duly endorsed by the Customs Examiner, to the Customs PreventiveOfficer
who endorses it with the ‘Let Ship Order’.

Pre- Shipment Stage

Pre-shipment stage consists of the following steps:

a) Approaching Foreign Buyers: - In order to secure an export order, a new exporter can make use of one
or more .of thetechniques, such as,’ advertising in international media, sales promotion, public relation,
personal selling, publicity andparticipation in trade fairs and exhibitions.

b) Inquiry and Offer: - An inquiry is a request from a prospective importer about description of goods,
their standard or grade,size, weight or quantity, terms of payments, etc. On getting an inquiry, the exporter
must process it immediately by making an offer in the form of a Performa invoice.

c) Confirmation of Order: - Once the negotiations are completed and the terms and conditions are finalized,
the exporter sendsthree copies of Performa Invoice to the importer for the confirmation of order. The
importer signs these copies and sends backtwo copies to the exporter.

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d) Opening Letter of Credit:- The documentary credit or letter of credit is the most appropriate and secured
method of paymentadopted to settle international transactions. On finalization of the export. Contract, the
importer opens aletter of credit in favor of the exporter, if agreed upon in the contract.

e) Arrangement of Pre-shipment Finance: On securing the letter of credit, the exporter procures a pre-
shipment finance from hisbank for procuring raw materials and other components, processing and packing of
goods andtransfer of goods to the port of shipment.

f) Production or Procurement of Goods: - On securing the pre-shipment finance from the bank, the
exporter either arranges forthe production of the required goods. Or procures them from the domestic market
as per thespecifications of the importer.

g) Packing and Marking: - Then the goods should be properly packed and JXl8.rkedwith necessary details
such as port of shipment and destination, country of origin, gross and net weight, etc. If required, assistance
can be taken from the IndianInstitute of Packing (IIP).

h) Pre-shipment ‘Inspection’ - If the goods to be exported are subject to compulsory quality control and
pre-shipment inspection then the exporter should contact the Export Inspection Agency (EIA). For obtaining
an inspectioncertificate.

i) Central Excise Clearance: - The exporters are totally exempted from the payment of central excise duty.
However, theexemption should be* claimed in one of the following ways: -

· Export under Rebate.

·Export under bond.

j) Obtaining Insurance Cover: - The exporter must take appropriate policies in order to insure risks: ECGE
policy in order tocover credit risks, Marine policy, if the price quotation agreed upon is CIF,Appointment of
C&F Agent: - Since exporting is a complex and time- consuming process, the exporter should appoint a
Clearing and Forwarding (C&F) agent for the smooth clearance of goods from the customs and preparation
and submission of variousexport documents.

Post Shipment Stage

The post-shipment stage consists of the following steps: -

a) Submission of Documents by the C&F Agent to the Exporter: - On the completion of the shipping
procedure, the C&F agentsubmits the following documents to the exporter:-
· A copy of invoice duly attested by the Customs.
· Drawback copy of the shipping bill.
· Export promotion copy of the shipping bill.
· A full set of negotiable and non-negotiable copies of bill of lading.
· The original L/C, export order or contract.

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b) Shipment Advice to Importer: - After the shipment of goods, the exporter intimates the importer
about the shipment of goodsgiving him details about the date of shipment, the name of the vessel, the
destination, etc. He should also send one copy of non-negotiable bill of lading to the importer.

c) Presentation of Documents to Bank for Negotiation: - Submission of relevant documents to the

bank and the process of getting the payment from the bank is called “Negotiation of the Documents”
and tile documents are called ‘Negotiable Set of Documents’. The set normallycontains:-
· Bill of Exchange.
· Full set of Bill of Lading or Airway Bill.
· Original Letter of Credit.
· Customs Invoice.
· Commercial Invoice including one copy duly certified by the Customs.
· Packing List.
· Foreign exchange declaration forms, GR forms in duplicate.
· Exchange control copy of the Shipping Bill.
· Certificate of Origin, GSP or APR Certificate, etc.
· Marine Insurance Policy, in duplicate.

d) Dispatch of Documents :- The bank -negotiates these documents to the importer’s bank in the
manner as specified in the L/C.Before negotiating documents, the exporter’s bank scrutinizes them in
order to ensure that all formalities have been compliedwith and all documents are in order. The bank
then sends the Bank Certificate and attested copies of commercial invoice to theexporter.

e) Acceptance of the bill of exchange: -bill of exchange accompanied by the above documents is
known as the Documentary Bill of Exchange. It is of two types:-

Documents against Payment (Sight Drafts): - In case of sight draft, the drawer instructs the bank to
hand over the relevantdocuments to the importer only against payment.

Documents against Acceptance (Usance Draft): - In case of usance draft, the drawer instructs the
bank to hand over the relevant documents to the importer against his ‘acceptance’ of the bill of
exchange.-

Letter of Indemnity: - The exporter can get immediate payment from his bank on the submission of
documents by signing aletter of indemnity. By signing the letter of indemnity the exporter undertakes
to indemnify the bank in the event of non-receipt of payment from the importer along withaccrued
interests.

Realization of Export Proceeds :- On receiving the documentary bill of exchange, the importer
releases payment in case of sightdraft or accepts the usance draft undertaking to pay on maturity of
the bill of exchange. The exporter’s bank receives thepayment through importer’s bank and is
credited to exporter’s account.

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 f) Processing of GR Form: - On receiving the export proceeds, the exporter’s bank intimates the same
to the RBI by recordingthe fact on the duplicate copy of GR. The RBI verifies the details in duplicate
copy of GR with, the, original copy of GR receivedfrom the Customs. If the details are found to be I
in order then the export transaction is treated to be completed.

g) Realization, of Export Incentives: - If the exporter is eligible for export incentives, then he should
submit claim for the same appropriate authority.

CHAPTER-5

CUSTOM DUTY IN INDIA

Custom duty in India is defined under the Customs Act, 1962 and enables the government to levy duty on
exports and imports, prohibit export and import of goods, procedures for importing/exporting and offences,
penalties etc. All matters related to custom duty fall under the Central Board of Excise & Customs (CBEC).
The CBEC, in turn, is a division of the Department of Revenue of the Ministry of Finance. CBEC formulates
policies that concern collection or levying of custom duties, custom duty evasion, smuggling prevention and
administrative decisions related to customs formations.

CBEC has various divisions that take care of the field work including Commissionerate of Customs,
Customs, Customs (preventive and Central Excise Zones, Central Revenues Control Laboratory and
Directorates etc. CBEC also oversees proper tax administration for foreign and inland travel.

1.1 Types of Custom Duty:

Custom duties are levied almost universally on all goods imported into the country. Export duties are levied
on a few goods as specified under the Second Schedule. Import duties are not levied on a few items including
lifesaving drugs/equipment, fertilizers, food grains etc. Import duties are further divided into basic duty,
additional customs duty, true countervailing duty, protective duty, education cess and anti-dumping duty or
safeguard duty.

 Basic Custom Duty:

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Basic custom duty is applicable on imported items that fall under the ambit of Section 12 of the Customs Act,
1962. These duties are levied at the rates prescribed in First Schedule to Customs Tariff Act, 1975, under the
terms specified in Section 2 of the act. The levied rates may be standard or preferential as per the country of
import.

 Additional Customs Duty (Countervailing Duty (CVD)):

This duty is levied on imported items under Section 3 of Customs Tariff Act, 1975. It is equal to the
Central Excise Duty that is levied on similar goods produced within India. This duty is calculated on
the aggregate value of goods including BDC and landing charges.
 Protective Duty:

Protective duty may be imposed to shield the domestic industry against imports at a rate recommended by the
Tariff Commissioner.

 Education Cess:

This duty is levied at 2% and higher educationcess at another 1% of aggregate of customs duties.

 Anti-dumping Duty:

Anti-dumping duty may be imposed if the good being imported is at below fair market price, and is limited to
the difference between export and normal price (dumping margin).

 Safeguard Duty:

Safeguard duty is levied if the government feels that a sudden increase in exports can potentially damage the
domestic industry.

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 STRUCTURE OF ORGANISATION

 CEO- Anil Kumar Rai

 Employees- Krishna Kant, Amit Pandey, Ravi Sharma

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 Major Learning

1. Filing of shipping bills in the various category of export incentive scheme/duties free on basis of
checklist of documents received.
2. Filing of Bill Of Entry.
3. Clearance of container.
4. Assessment of custom duties.

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 SWOT ANAYLYSIS

STRENGTH OPPORTUNITIES
 More transparent services which help to gain  Removal of international trade
the confidence of customers. barriers.
 Well trained professionals and efficient work  Arrival of new technologies.
force.

WEAKNESS THREATS
 Brand name has limited recall owning to  Major players in industries.
lesser advertisement and research compared  New regulation in government policies.
to global leaders.

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 RECOMMENDATION

 The firm should increase the number of employees to divide the work load equally.
 The firm should develop new ways to provide service to clients.

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 BIBLIOGRAPHY

DEPARTMENTAL WEB SITES

Central Board of Excise Customs Sites of

http://www.cbec.gov.in

DIRECTORATE OF VALUATION

http://www.dov.gov.in

Books reffered

Foreign Trade-Theory, Procedures, Practises and documentation by Dr. Khuspat S. Jain & Dr. Apexa
V. Jain

Export Management – D.C.Kapoor, Vikas Publishing House

Guide on export policy, procedure and documentation- Snow White Publication

Professor- Sanjaree Sharma Mam

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