AT

Dynamic Logistics Pvt. Ltd.

In Partial Fulfillment For

PGDIT
INSTITUTE OF MANAGEMENT DEVELOPMENT AND
RESEARCH

SUBMITTED BY
DEEPAK MUNDADA
PGDIT-II (2009-11)
Roll No. 12

ACKNOWLEDGEMENT

Internship Report
IMDR,
Pune
I express my sincere gratitude to the following people without whom this internship would have
not been possible. I would like to thank Mr. Raiza Ahmed, HOD operations, DLPL for giving me
a chance to work with Dynamic Logistics .I am also grateful to Mr. Santosh Giri, Mr. Sikandar
Nadaf, Mr. Jalinder Thite, my mentor Mr. Sandeep Mhaske, whose cooperation and guidance
helped in successful completion of my internship .I also thank all the staff, CHAs working with
Dynamic logistics.
I would like to thank all the employees of Dynamic Logistics who help me to understand and
equipping me with the tools required for an individual to work in this Industry. Thus working in
ICD was a worth mentioning experience. I am thankful to them for a considerable value addition
to my knowledge related to international trade .I would specially like to thank Mr. Paritosh
Gombi, of EMU Lines, for his advice and guidance towards NVOCC operations and cooperation
intended to me in successful completion of the internship.
Also I would like to express my sincere gratitude to Mr. Ajay Nagre, Ex-director of IMDR,
Mrs. Vipra Tiwari, and Mr. Manish Mishra for giving me a chance to undergo this kind of
experience and without whose support

Deepak Mundada

Deepak Mundada

Page 2

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

INDEX
Sr. No

Contents

Page no

Objective

Executive summary

What is an ICD

Company profile

7-8

Important entities in international trade and their functions

9-16

Important documents and other terminologies

17-21

General export procedure and documents

22-28

Export procedure followed at ICD

29-34

Import procedure followed at ICD

35-36

10

Import duties and documents

36-39

11

Bibliography

40

OBJECTIVE OF THE SUMMER INTERNSHIP

The main objective behind this summer internship programme is to make oneself aware about
the Import - Export procedures and also the documentation required for the same. In the
meanwhile to learn the working of ICD Dighi.

Deepak Mundada

Page 3

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
Also to thoroughly understand the operations in the field of Import and Export and to understand
the complex working procedures of the customs department and how the custom clearance does
takes place.
Working here in Dynamic logistics has also helped me experiencing a total logistics organization.

EXECUTIVE SUMMARY

The Summer Internship was the first step towards getting practical knowledge in the field of
international trade. Describing each and every activity, all the happenings, big and small is
impossible to cover in this report. But surely it will give a window view of my experience in the
Summer Internship.

Deepak Mundada

Page 4

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
The main objective of doing the summer internship training at Dynamic Logistics (ICD) Dighi is
to learn the various practical aspects of working of Custom House Agents (CHAs),
consolidators, surveyors and customs. This report gives a window overview regarding practices
and procedures adopted by Custom House Agent (CHA). It did help me in achieving the Summer
Internship objectives and gave me an opening to learn how this industry works.
The PGDIT course in our Institute is designed in such a way that students would get the
necessary theoretical knowledge regarding the International Trade and also get a practical
exposure towards the functioning of a company, which is involved in International Trade.
At the end of the course, we are supposed to know the roles and responsibilities of the
Organization.
My objective of the Summer Internship was to know the ground realities of Import & Export
procedure. Working on live cases and handling consignments was the most effective tool for me
to equip myself practically with the challenges faced by the International Trade Industry.
Dynamic logistics has achieved great height and good reputation as private ICD. I got a good
exposure working in ICD and practical knowledge which is most important from my point of
view.

WHAT IS AN ICD
A common user facility with public authority status, equipped with fixed installations and
offering services for handling and temporary storage of cargo under the customs control and
other competent agencies to clear the goods for home use, warehouse storage, and export. The
government of India decided to set up the inland container depots which are also called as the
dry ports.
Deepak Mundada

Page 5

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
Functions performed at an ICD include receipt and dispatch of cargo, stuffing and destuffing of
the cargo, transit of the same, customs clearance, temporary storage, etc.
Shipping formalities can be completed in ICDs and also the custom procedure takes place here.
ICD is an organization which tends to offer a total package of activities to handle and control
container and general cargo resulting in maximum service for minimum costs.

BENEFITS OF ICD Dighi:

The benefits as envisaged from an ICD Dighi are as follows:

Concentration points for long distance cargoes and its unitization.

Service as a transit facility.

Customs clearance facility available near the centers of production and consumption

Reduced level of demurrage and pilferage.

No Customs required at gateway ports.

Reduced overall level of empty container movement.

Competitive transport cost.

Reduced inventory cost.

COMPANY PROFILE

The company is the member of the TALERA GROUP operating in INDIA since 1940s.
Established as Dighi warehousing Pvt Ltd in 1993 and further renamed as Dynamic Logistics in

Deepak Mundada

Page 6

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
the year 1995.Soon the company became a pioneer in the field of Logistics and Supply Chain
Management. Further the company has ISO 9001-2000 Accreditation.
Dynamic logistics Pvt Ltd is a leading 3rd Party logistics service provider in India. It not only
provides Logistics and Supply Chain Management but also warehousing and distribution
solutions to its customers. In the year 1998 Dynamic logistics began its Inland Container Depot
at Dighi (ICD).
It also has a custom bonded facility for the international trade purposes; it also acts as a
custodian for the Indian customs and handles Imports and Exports through the means of
containers and the movement of the same between ports of Mumbai like Nhava Sheva.
Dynamic logistics also has created adequate space for the loading and unloading of the
containers.
The purpose of ICD is to provide infrastructure facilities and other handling facilities that
support the Imports and Exports by providing Customs, Bank, Octroi, Shipping line, and CHA
offices in ICD Dighi.

QUALITY POLICY
The organization is committed to provide the best, cost effective, timely logistics service. The
organizations endeavor is to develop and operate fully integrated SCM and trade related
infrastructure for all its customers.
The culture of the organization is one of the best where in training and educating personnel for
achieving excellence in quality both in process and in performance is the topmost priority.
Deepak Mundada

Page 7

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

LOCATION
The company is located at Dighi in Pune .Its well connected with air and road. The gateway port
is Mumbai located 150 kms.

FACILITIES
It has all the operating facilities, a container yard, Import warehouse, bonded warehouse, Export
warehouse.
Also have the various equipments required for loading and unloading of the containers and also
the forklifts for handling of the cargo. A cargo scanner installed by the customs is also present in
the import warehouse
Administration facilities include the customs office headed by the deputy Commissioner,
Shipping line offices, NVOCC offices, and CHAs, freight forwarders and surveyors.
Other facilities include a latest communication centre with all the facilities like phone, fax, and
internet; photocopy etc.
The premise is well protected with high scale compound walls and round the clock security. The
organization also houses a full fledged software centre and has its own warehouse management
system with a full track and trace management systems.

SOME IMPORTANT ENTITIES INVOLVED IN THE BUSINESS

OF INTERNATIONAL TRADE

CUSTOM HOUSE AGENT/S

The imports into India and Export out of India take place only through ports and airports
declared under Section 7 of the Custom Act. The international trade has therefore necessarily
Deepak Mundada

Page 8

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
developed and concentrated at such ports and airports like Mumbai, Chennai, Calcutta, Delhi,
Cochin, Kandla, Vishakhapattanam, and Tuticorin.
Trade, no doubt is also through minor ports all among the coast. The importers who consume the
goods imported and exporters who produce the goods for export however are spread all over the
country. The distance between the point of import/export and the exporters/importers happens to
be quite long and the time-involved clearance deters the trade for handling the clearance
themselves. They have to necessarily depend on agents positioning themselves at such ports and
are specialized in such jobs. In fact such institutions have been in existence almost from the
beginning of the trade.
Customs House Agent (CHA) is a person who is licensed to act as an agent for transaction of any
business relating to the entry or departure of conveyances or the import or export of goods at any
Customs station. Unlike the work related to Central Excise and Income Tax, the customs
facilities cannot be attended to leisurely, as clearance is allowed only on completion of
formalities and payment of duty, where due. To meet this situation alone this provision for
licensing Custom House Agents to represent importer/exporter for clearance work has been made
in the Custom Act (under sec. 146)
A Custom House Agent has to be not only knowledgeable in Customs Laws, procedure and
documentation, but also alert all the time, closely following the instructions or changes brought
about by issue of Public Notices from time to time. He is in a very peculiar position that though
he is employed by importers /exporters, he is licensed by the Customs dept. The Customs House
Agent is answerable both to the Customs dept. for doing the clearance correctly and
expeditiously. In case he defaults, the clearance may be delayed and demurrage etc. incurred. His
knowledge and experience particularly in the areas of classification and valuation of goods and
more so in procedural formalities to be compiled with, in Custom big role to play in the
clearance of goods through customs.

ROLE OF C.H.A:A role of C.H.A starts:-

o When an exporter or;

Deepak Mundada

Page 9

Dynamic Logistics, ICD Dighi.

Internship Report
Pune
o An importer asks him to work for him.

IMDR,

o A Custom House Agent firm prepares:o Bill of entry or

o Shipping Bill
o As per the requirement of the customers, for these services the customer provides them
with all the required documents like;
o Invoice,
o Packing list and other relevant documents.
A C.H.A firm should try to prepare documents on time to get goods delivered. The C.H.A
collects these documents from the customer and according to that they prepare shipping bills or
bill of entry. After preparing the documents some time they collect the goods from the exporter
and with the documents they go to ICD or at the PORT of DISCHARGE and get the goods
custom cleared. If an exporter or an importer has some special requirement like if they want their
goods to be exported under special schemes then they prepare documents according to that and
vice versa for an importer.
They collect
services charges
services tax
custom charges and;
Other charges from the customer.

MANAGEMENT AT C.H.A
FILING:
Filing is an important process of any C.H.A company. They have to maintain several files as that
helps them to know how much business they have done in a financial year so they can know their
condition at the end of a year.
They have to prepare separate files for both imports and exports, this also helps them to know the
profits they have made in a year and expenses incurred by them in a year.
Deepak Mundada

Page 10

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
These files contain all the documents given to C.H.A Company by an importer or an exporter. So
these files contain all these documents, services charges taken by a C.H.A for clearing of goods
from the customs.

FREIGHT FORWARDER
Freight Forwarding is a vital part of international trade. The company will face many difficulties
if it does not take into account how the goods will be delivered to the market.
The issue of freight forwarding must be considered at an early stage of the development of the
export marketing plan as it raises several concerns that need to be addressed quickly. Not only
does the exporter need to understand which INCOTERMS to stipulate and work to, but the
method of transport also needs to be considered (road, rail, sea, air). Packaging is also another
factor that needs to be considered, as is insurance. Much of the hassle can be taken out of the
exporters hands by using an effective freight forwarder, but as with any supplier care needs to be
taken to ensure that the supplier meets the needs of the organisation.
A freight forwarder is an agent who handles export shipments for a fee. Hence, freight forwarder
plays a very important role for exporters. Here are few of the many activities that you will
conduct as a freight forwarder:

International documentation and packaging

Carrier and routing information

Export license assistance

Marine insurance rates and coverage

Warehouse and distribution services

Hazardous materials shipping compliance information

ROLE OF A FREIGHT FORWARDER:The Freight Forwarder plays a very important role. He is the entity who on behalf of the Shipper
does all procedural & documentation formalities involved to get the goods Custom Cleared.
Deepak Mundada

Page 11

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
They also look after warehousing & carting of cargo before shipment of export consignments &
after a discharge of import cargoes, by sea carriers. There is a important aspect of their workconsolidation of shipments.
The role of a Freight Forwarder is as Follows: Selection of routes
Determination of shipping documents
Delivery to carriers & collection of documents
Keeping the consignor & consignee informed
Assisting for preparation of shipment documents
Preparing & processing documents through Customs, port & Octroi authorities, payment
of fees, duty etc.

FLOW CHART SHOWING FUNCTIONS OF FREIGHT

FORWARDER:-

Deepak Mundada

Page 12

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

Exporter
1

IMDR,

Stuffing

De-stuffing

Importer
1

CFS 2

Importer
2

POL
Exporter
2

CFS 1

Container

Container

Vessel

POD
Exporter
3

Importer 3

OCEAN JOURNEY

In the above diagram, E1, E2 & E3 send their LCL cargo to CFS 1. The consolidator stuffs the
cargo into the container. This container could be his or of another shipping line. The process is
called Consolidation. Then the container is sent overseas via ocean journey, to CFS 2 in
another country. There the container is de-stuffed and LCL cargos are given to the respective
importers.
The above process involves both consolidation & freight forwarding. Today, the services of a
forwarder are usually available with a consolidator, and the forwarder often engages in the
consolidation of cargo. Hence, the term forwarder is often used synonymously with the
consolidator.
Charges: The forwarder usually receives the forwarder's charges from the exporter.
In the ocean shipment, the forwarder may 'buy' the shipping space, in a special arrangement with
the carrier, and 'resell' the space to individual shippers, instead of receiving a commission.
In such an arrangement, the forwarder functions as an independent distribution or logistical
company known as the NVOCC (non-vessel operating common carrier).

NVOCC (Non Vessel Operating Common Carrier):

Generally they are the entities, that dont own the vessels. They reserve space on the vessels of
the shipping lines for the containers that are being dispatched by them, as they have tie-up with
Deepak Mundada

Page 13

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
shipping lines. For this the shipping line charges some extra money to them for the same. This is
because; the carriers have the benefit of dispatching the container on board the ship for the
particular destination even though the space is full on the vessel. They have an advanced
reserved space on the vessel for their containers. These carriers have the authority to issue the
Bill of Lading. The freight forwarder ensures that your goods receive the priority it requires;
your documentation is appropriately filled and your goods reach its destination in the specified
time.

SURVEYORS
As I worked with ICD, I got to know the role of entity called surveyors involved in exportimport transaction. Surveyors play major role in international trade. As a part of ICD, I got the
chance to work with Master marine surveyors. I got to learn some practical things which were
new to me. The working experience was good and worth mentioning.
As the name suggests, surveyors are an entity which involved in survey/checking the condition
of consignment or container. The survey report submitted by surveyors plays crucial role in case
of any discrepancy. There are various kinds of examinations conducted by surveyors on the basis
of which survey report is issued. There are many types of surveys conducted by surveyors as
asked by Importer or Exporter under heading:

1)
2)
3)
4)
5)
6)
7)
8)

Cargo Lashing report

Import cargo survey report
Container examination report etc.
The survey report contains following details,
Survey applicant
Survey date and time
Place of survey
Consignee
Invoice no & Date
No of Packages
Description
Gross weight & Net weight
In case of survey of cargo, the details examination is mentioned i.e. the condition of cargo
where damaged or proper. If damaged, then total description and reason for damage of goods
is given in survey report.

Deepak Mundada

Page 14

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

CONSOLIDATORS
Consolidators, as the name suggest is an entity which is responsible for consolidation of cargo.
In the case of LCL shipment (lesser than container load), the consignment is sent to
consolidators. Who then after getting other sufficient LCL consignments which are supposed to
be shipped the same destination, books the place in container. After which as the place in
container is utilized, the container is shipped to particular destination. Hence by converting LCL
shipments to FCL consolidators earn huge profits.

CUSTOMS
Customs clearance of the goods, is done by the customs Authorities functioning under the overall
change of the Ministry of Finance.
At the apex there is Central Board of Excise & Customs in the Ministry of Finance.
The Board is headed by the Chairman and assisted by members.

Customs perform following roles,

a) To ensure that whatever items move into or out of the country are in accordance with the
laws of the land, and not, prohibited or banned.
b) Both in regard to sea cargo as well as air imports, the customs authorize and appoint
custodians and all imported goods unloaded in a customs area remains in their custody
and till these are cleared for home consumption, or are warehoused or transshipped as
provided in the law.
c) The items of import & export are properly assessed to duty tax or any other charge
leviable there on.
d) All the regulatory provision application to items of exports & import are being duly
complied with the exporter & the importer.
e) The import / export trade statistics are regularly compiled & made available to different
authorities for their guidance & necessary action.

SHIPPING LINE/S
Deepak Mundada

Page 15

Dynamic Logistics, ICD Dighi.

Internship Report
Pune
a) The shipping line is responsible for the preparation of Bill of lading.

IMDR,

b) It is also responsible to deliver in the goods in the like order and condition as received
from the consignee.
c) The shipping line is also responsible for maintaining the goods in proper manner and
filing the IGM.

SOME IMPORTANT DOCUMENTS AND OTHER

TEMINOLOGIES
Importer-Exporter Code (IEC)
IEC is a prerequisite for any exporter or importer. All the below-mentioned categories of
exporters as well as importers require an IEC No. which is the basic requirement in international
trade.

Manufacturer Exporters:

Merchant Exporters:

Deemed Exporters:

Deepak Mundada

Page 16

Dynamic Logistics, ICD Dighi.

Internship Report
Pune
Service Exporters:

IMDR,

Third party Exporters

Airway bill (AWB):

Means the document made out by or on behalf of the shipper, which evidences the contract
between the shipper and carrier(s) for carriage of goods over routes of the carrier(s).

Master Airway Bill (MAWB): It is issued by the airlines to the Consigner/Freight

Forwarder, which certifies that goods are received by the airlines for transit

House Airway Bill (HAWB): This document is issued by the freight forwarder to
the consigner, when the cargo is LCL.

ARE (Application for Removal of Excise) Form:

It is an application for removal of excisable goods for exports from India by any mode i.e. sea,
air, post and land. It is required in cases where sealing of goods and their examination takes place
at the place of dispatch and also for dispatch of goods without examination.
These forms are required to be printed in different colours to facilitate disposal of goods for
export in bond or under rebate of duty.

Break Bulk Cargo:

The cargos that transit in loose form, and are not containerized due to their size.

Break Bulk Agent:

Deepak Mundada

Page 17

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
An agent who deals in break bulk cargos or breaks consolidated consignments into their
individual parts.

Bill of lading:
Bill of Lading is a document issued by the shipping company or its agent, acknowledging the
receipt of goods mentioned in the bill for the shipment 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 specified in the bill of Lading have been duly paid.

Consignee:
The party to whom the goods are to be delivered.

Combined Transport Document: Combined Transport Documents are used for movement
of goods from ICD that are set up in various centers in the country to destinations

EDI (Electronic Data Interchange):

The transfer of structured data from one computer to another (detail of shipping or air cargo data
interchange).

EP (Export Promotion) Copy:

It is the final copy of shipping bill, which is issued by the customs. It is generally used for
getting benefits and is submitted to the consigners bank as the proof of export.

FCL (Full Container Load):

When the container is loaded fully with the cargo.

LCL (Less Then Container Load):

Deepak Mundada

Page 18

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
When the particular cargo occupies less space than a container load it is a LCL cargo.

Factory Stuffing:
The export cargo of manufacturer/merchant exporter is stuffed in their factory premises under
central excise supervision.

Form N:
This form waves the Octroi on the goods entering from one municipal corporation, to the
municipal corporation of port of loading.

GR Form / SDF Form:

(Guarantee of Remittance Form) It is the declaration to be given by the exporter to the
Government of India, which abide him for remittance of the foreign earnings on making exports.
This form is to be given in Original and duplicate signed by the exporter.
It contains details of Customs Assessable value, Name of the bank through which
payment is to be made, Name of the advising bank and the declaration under Foreign Exchange
Management Act, 1999.
The Statutory Declaration Form (SDF) is required in case of exports the shipping bills relating to
which are processed electronically. It replaces GR Form. The exporter to the shipping bill shall
append it.
After verifying and authenticating the declaration in SDF, the customs will hand over to the
exporter, one copy of such shipping bill marked Exchange Control Copy to which the form
had been appended, for being submitted to bank.

GSP (Generalized System of Preference) Certificate:

The East European Countries (EEC) comprising France, Germany, Belgium, Luxemburg,
Netherlands, Italy, United Kingdom, Ireland, Denmark and Greece have adopted the GSP, under
which manufacturers and semi-manufacturers of goods from developing countries including

Deepak Mundada

Page 19

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
India will be entitled to a concessional rate of import duty in these countries. The Govt. of India
authorized the export agencies to issue the certificate of origin.

Mates Receipt:
Mate Receipt is issued by the Chief of the vessel after the cargo is loaded onto the ship. This is
later presented in the office of Shipping agent to be exchanged with the Bill of Lading. This
document is transferable in nature and is formed in Standardized Aligned Format. The main
details if the Mates Receipt is as follows:
1) Name of the exporter
2) Place of receipt
3) Voyage number
4) Port of loading
5) Port of discharge
6) Port of delivery
7) Marks and numbers
8) Container number
9) Description of goods
10) Gross weight etc.

Invoice:
It is the document which is issued by the consigner to the consignee, on which the payment for
the goods or services are done by the consignee. It contents all the details of the contract.

Packing List:
It gives the information like the invoice number, number of pieces, number of pieces per
package, number of packages, dimensions of packages, general description of cargo, net weight,
gross weight, etc.

POL/POA (Port Of Loading/Port of Acceptance):

The place where the goods are received for the shipment for transit and where the carrier liability
is commences.

POD (Port Of Destination/Discharge):

Deepak Mundada

Page 20

Dynamic Logistics, ICD Dighi.

Internship Report
Pune
The place where the goods are delivered and carriers liability ends.

IMDR,

Slot:
The space occupied by the container on the vessel.

Transshipment:
Unloading and Loading of the cargo in between the transit.

Terminal:
The place where the cargo is loaded/unloaded under the customs supervision.

GENERAL EXPORT PROCEDURE

RECEIPT OF ORDER BY EXPORTER

ON BASIS OF INVOICE AND PACKING LIST THE

NEXT STEP IS DECIDED
FACTORY STUFFING OF EXPORTS OR CONTACT
C.H.A AND FURTHER PROCEED ACCODINGLY
ASK THEM TO DO THE STUFFING
CONTACT C.H.A FOR CUSTOM CLEARANCE

Deepak Mundada

Page 21

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

GET THE CHECKLIST FROM THE CUSTOMS

AFTER SUBMITTING THE INVOICE, PACKING
LIST. ETC
SUBMITTING THE INVOICE, PACKING LIST
CHECK THE CHECKLIST AND SUBMIT IT TO THE
CUSTOMS AND RECEIVE SHIPPING BILL NO

PREPARATION
OF SHIPPING
DEPENDING ON
RECEIVE
SHIPPING BILL
BILL NO
DUTY FREE OR NOT
WHATEVER SHIPPING BILL-DEPB /DRAWBACK IT
OR NOT
HAS TO BE ASSESSED ACCORDINGLY.

C
O
N
T
T
.

CARGO IS OFFLOADED AT ICD/ CFS AND CUSTOM

EXAMINATION TAKES PLACE.

REGISTRATION OF GOODS TAKE PLACE BY

EXAMINER, DEPUTY COMMISSIONER, APPRAISER

A DETAILED CHECK TAKES PLACE LIKE. NATURE

OF GOODS, VALUE OF GOODS, WEIGHT, AND
INCENTIVES LIKE DEPB ARE PROPERLY CHECKED.

AFTER VERIFICATION LEO (LET EXPORT ORDER)

IS ISSUED

FINAL PRINTOUT OF SHIPPING BILL IS TAKEN

Deepak Mundada

Page 22

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

GOODS STUFFED INTO THE CONTAINER IF NOT

DONE EARLIER

GOODS LOADED ON TO THE VESSEL UNDER

SUPERVISION OF PREVENTIVE OFFICER

CONTAINER SEALED BY THE SHIPPING LINE AND

THE PREVENTIVE OFFICER
C
O
N
T
.

LINER/FF ISSUES BILL OF LADING WHICH STATES

RECEIVED ON BOARD OR SHIPPED ON BOARD

THEN MATES RECEIPT ISSUED BY VESSELS CAPTAIN

IN WHICH GOODS ARE LOADED. THIS IS DONE AFTER
TALLYING CARGO WITH S/B(DUPLICATE).
EXPORT PROMOTION COPY IS GENERATED AFTER
FILING EGM COPY. ITS PROOF SHOWING THAT GOODS
ARE EXPORTED. ALSO USED TO CLAIM DEPB
INCENTIVES
After understanding of the procedure, we could understand the documents involved therein and
also its role in the procedure. Which are as below mentioned:

Invoice:
Deepak Mundada

Page 23

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
An invoice is a document which contains the detailed description of the goods consigned, order
of acceptance or contract no., IEC No., Cosigners & Consignees address, port of loading, port
of destination, country of origin, marks and number, number of packages, special marks (if any),
quantity shipped, selling price, terms of payment, terms of delivery amount of freight and
insurance (if applicable) etc. It is a good evidence of the contract of sale. The invoice should be
strictly according to the contract of sale and should be on the paper of seller and must be signed
by him or by the person acting on his behalf.

Packing List:
Packing List gives the information like the invoice number, number of pieces, number of pieces
per package, number of packages, dimensions of packages, general description of cargo, net
weight, gross weight, etc.

Letter Of Credit:
Letter of Credit is a written understanding by a bank (issuing bank) given to the seller
(beneficiary) at the request and in accordance with the instructions of the buyer (applicant) to
effect payment up to a stated sum of money within a prescribed time limit and against stipulate
documents. These stipulated documents are commercial invoice, certificate of origin, insurance
policy (if required) etc. Credits may either be revocable or irrevocable.

Shipping Bill:
Shipping Bill is an important document required by the customs authorities for allowing
shipment. It is prepared by the exporter / CHA and contains several details. The documents that
are required to prepare the shipping bills are as follows:
1) Four copies of Invoices
2) Four copies of Packing List
3) Self Declaration Form
Deepak Mundada

Page 24

Dynamic Logistics, ICD Dighi.

Internship Report
Pune
Contract, Letter of Credit, Purchase Order

IMDR,

Types of shipping bill

Duty drawbackGreen

-(7)

Duty Entitlement Pass Book (DEPB)..Blue

-(7)

Duty Exemption Entitlement Certificate... White

-(7)

Free Shipping bill.White

-(6)

Export oriented Unit. (EOU)Pink

-(6)

Duty free shipping bill..Yellow -(6)

The figure in the bracket indicates the number of shipping bill copy used under different scheme
of the shipment of the good.

1)

Duty Free Shipping Bill: This type of shipping bill is used for the goods for which
neither duty nor is cess applicable. It is also used for the goods manufactured out of
materials imported under the duty free import. It is white in color.

2) Dutiable Shipping Bill: This type of shipping bill is used for goods subject to export duty/
cess, which either entitled or not entitled for drawback. It is used separately in respect of
which export duty is levied on the basis of (a) market price (b) tariff assessed value. It is
yellow in color.
3) Drawback Shipping Bill: If the export of goods is simultaneously by duty free and / or
subject to export duty / cess, this type of shipping bill is compulsorily to be used whether
alone or
4) Along with any other shipping bill. It is green in color.
5) Shipping Bill for shipment Ex-Bond: case of goods imported for re-export and kept inbond, this type of shipping bill is used. It is pink in color.
6) DEPB Shipping Bill: This kind of Shipping Bill is used when the export is under the scheme
of DEPB. It is blue in color.
Original. .Customs Copy
Deepak Mundada

Page 25

Dynamic Logistics, ICD Dighi.

Internship Report
Pune
Duplicate.Customs Copy

IMDR,

Export Promotion Copy..EP copy

Quadruplicate*... Scheme Copy
Port trust Original...Port
Port trust Duplicate..Port
Port trust Triplicate. Dynamic logistic.

NOTE
4TH copy is optional and is required according to the scheme under which the goods are shipped.
In the case where only six copy of shipping bill is required 4 th copy is not used whereas in the
case where seven copy of shipping bill is used 4th copy is used.

Bill Of Lading:
Bill of Lading is a document issued by the shipping company/ its agent acknowledging the
receipt of goods mentioned in the bill for the shipment 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 specified in the bill of Lading have been duly paid.

The Bill of Lading undergoes the following steps:

1)

The exporter should give to the shipping company a complete set of the Bill Of Lading
along with the Mates Receipt.

2) The shipping company shall calculate the amount of freight on the basis of weight or
measurement as recommended by the recognized Chamber of Commerce.
3) The exporter shall pay the thus calculated freight amount.
4) The shipping company shall return the Bill of Lading to the exporter duly signed and
supported by the requisite adhesive stamps.
5) The Bill of Lading eventually are, through the banking channels sent to the importer so that
he can take the delivery of the cargo after making the due payments.
Deepak Mundada

Page 26

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
There are generally 2-3 copies of the Bill of Lading prepared. The master/ agents of the
shipping company duly sign all the copies. All the originals are equally valid for taking the
delivery of the goods. Once one copy is so utilized, the rest of the copies are rendered null
and void for the purpose. Utmost care should be taken to see that none of the copies go in the
wrong hands. The exporter should take all the original copies form the shipping company or
its agent as the case may be.
A few more copies of Bill of Lading are also issued, marked as Non- negotiable, which
cannot be used to take the delivery of the goods. There are various types of Bill of Lading
depending upon the terms of Letter of Credit. Some of them may not acceptable under Letter
of Credit unless specifically permitted. They are also distinguished on the basis of the
contents and validity of the Bill of Lading. They are as follows:
1) Clause Bill of Lading: This contains the additional clauses limiting the responsibility of the
Shipping Company and indicating defective conditions of the goods. This Bill of Lading is
not acceptable unless specifically authorized.
2) Clean Bill of Lading: It is the one that does not contain any superimposed clause or
annotation, which expressly declares a defective condition of the goods and/ or packaging.
3) Stale Bill of Lading: Is the one, which is tendered to the bank at so late a date that though
within the validity of Letter of Credit, it is impossible for it to be dispatched to the consignee
in time to reach him before the goods themselves arrive at the destination port.

FOB Value: - (FREE ON BOARD)

The value of the goods needed to be represented in the FOB term. In case the term of the contract
is FOB then it is same as the invoice value, but in the case of the C&F and CIF, freight or freight
and insurance need to be deducted respectively as the case may be.

PMV Present Market Value: Generally it is 10 % greater than the FOB value. It is taken because of the assumption that the
market value of the goods increases during the time gap.

Deepak Mundada

Page 27

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

Bill of entry:
A list of goods received at a customhouse for export or import. An importer of any goods
presents the Bill of Entry

EXPORT PROCEDURE FOLLOWED AT ICD

Export

FCL (factory, ICD,

Roundtrip)

LCL

AIR

1) ROUND TRIP FACTORY STUFFING

ICD, Dighi
Picks up nominated empty Container from S/L Yard
Goes to Exporter's factory Premise for stuffing.

Exporters factory Stuffing of cargo in containers

Deepak Mundada

Excise formalities

Page 28

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

The loaded container comes back to ICD and the entire

Customs formalities takes place

Gateway Ports / CFS at JNPT, Mumbai

2) FACTORY STUFFIING
Empty container is sent to the Factory of the exporter for
stuffing
Cargo is stuffed in the container and completion of all excise
formalities
Stuffed container comes to ICD to complete all documentation
processes and the custom clearance and the container is sealed

Loaded container gate pass is generated and departure of the

shipment for JNPT
Container loaded in the vessel and sent to the destination

3) ICD STUFFING
This process begins from the premise of the exporter
Cargo is loaded in trucks and sent to Dynamic logistics Pvt Ltd
Dighi
The cargo is unloaded here and stacked at the specific location
in the export warehouse
Deepak Mundada

Page 29

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

Documentation procedure, customs examination of the cargo to

be exported
Customs cleared cargo is stuffed and the container is sealed

Departure of the container from ICD to JNPT loading on the

vessel and departure to the destination.

EXPORT AND CUSTIOM CLEARANCE PROCEDURE AT

DYNAMIC LOGISTICS
1) The CHA on the behalf of the exporter files the request form for the use of the terminals
for exports along with packing list and invoice.
2) The Customer Relations (CR) officer provides the required services and fills the charge
sheet.
3) Then the index number is generated which is unique for each customer and is important
for future references.
4) For the movement of the empty container the CR issues form number 12 to the
transporter.
5)

The transporter picks up the container of a particular Shipping line and sends it to the
factory of the exporter.

6) The container gets stuffed and brought to ICDDighi for the required documentation and
custom procedures
7) Following documents are generated
(a) If the factory of the exporter lies outside the PCMC area 3 copies of the loaded gate
pass are generated
(b) 1 copy is sent to t chief superintendant of PCMC Octroi post.
Deepak Mundada

Page 30

Dynamic Logistics, ICD Dighi.

Internship Report
Pune
(c) 1 copy is given to the transporter.

IMDR,

(d) 1 copy is retained with the gate in charge of the ICD.

(e) If the factory lies in the PCMC limits, 3 copies of the empty container gate pass along
with 3 copies of the loaded gate pass are generated .all of them are distributed to the
authorities as the above. The documents are useful for the fulfillment if the Octroi
formalities.
8) The CHA on then submits the shipping bills to the customs department .Shipping bills
serve as a specification of the goods to be exported
9) The role of the customs starts from here, so the appraiser scrutinizes the documents
carefully, and if needed he indicates the examiner for the same. Then the process of
assessment takes place.
10) The duly signed copies of the shipping bills are then given to Dynamic Logistics in a
sealed and stamped envelope.
11) The ICD incharge, after receiving commercial invoice, shipping bills and transference
copies generates the following documentsJob order 6 copies ----- 1 copy to the customs,(ICD PUNE ),1 copy to CHA ,1 copy to
transporter, 1 copy to the Shipping line ,1 copy to the port trust, and 1 copy to the own
records (DLPL)
Flow of Shipping Bill:The original Shipping bill, Duplicate Shipping bill, EP copy and the scheme copy is retained by
the custom of ICD Dighi. One of the Transference Copy (Triplicate Port Trust) is retained by the
DLPL for their record and reference.
Two copies (original + duplicate) of the Transference Copy (Port trust) retained with CHA. CHA
will forward the Original and Duplicate PT Copy along with Freight Certificate and Forwarding
Letter to DC of the sea port / air port of the customs in a sealed envelope. At the port the
envelope is opened and the seal of the container or CBT is checked along with the container no.
Deepak Mundada

Page 31

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
truck no. and gate pass of DLPL. In case of any damage to seal or any suspicion the cargo is sent
back to the ICD Dighi or permitted to enter. The truck will reach to specified container yard
where the container is unloaded from the vehicle. The container should reach to the container
yard before the cut off time. Now days it is mandatory for the exporter to inform to the custom
of port of shipment 24 hour before the scheduled time of shipment. The shipping line files EGM
Export General Manifest. Shipping Line/ Airline issue Bill of Lading/ air way bill when the
goods is received by the shipping line. When the goods are physically exported the shipping line
issue Mate Receipt to the customs. The mate receipt is forwarded along with the transference
copy by the custom of port of loading to the custom of ICD Dighi. On receiving the transference
copy and mate receipt the ICD Dighi customs write the detail of the mate of receipt on the back
of the EP copy at the specified space. The ICD Dighi customs release the EP copy to the
concerned CHA along with the scheme copy and ARE. The EP copy along with GR is required to
be submitted to Authorized Bank through which the payment will be realized. Scheme Copy is
required for any incentives and ARE for the drawback of the Excise duty paid on the exported
goods.

PROCEDURE FOLLOWED FOR AIR EXPORTS AT ICD

CHA Exporter after noting Shipping Bill approaches ICD and files request F#l for
Carting of cargo along with Shipping Bill, Airways Bill, Commercial Invoice and
Packing list (OPTIONAL).

(This activity involves collection' of Cargo wm several exporters and consolidation at

Dronagiri Hub)

Shipping Bill: Export specification is prepared for customs. They require to inspect the
goods after the shipping bill is prepared to verify the good$ being exported. Customs
allow the goods to be exported and the drawbacks and other export benefits based on
Shipping Bill

After receiving request ICD issues a GP F#4 (3 copies), 1 copy for Gate In charge (ICD),
2 copies for transporter out of which one copy Octroi. Octroi issues a debit memo but this
is only for cargo arriving from area other than PCMC limit. If factory is within PCMC
limit there is no need to pay Octroi.

Deepak Mundada

Page 32

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
Once cargo arrives at the gate security allows the cargo to enter on seeing the GP and
records the time, exporter details, cargo description, no of packages and quantity.

Party/CHA approaches DL-CR for issue note for unloading the cargo at ICD Warehouse.
CHA Exporter gets cargo cleared by customs and obtains Shipping Bill (Transference
Copies)

DL obtains Permission-letter of the customs for transit through CBT and after that
prepares stuffing sheet for stuffing cargo in CBT. An approved surveyor (Master Marine)
surveyors the goods and produces certificate of measurement, document prepared by the
surveyor as a proof of measurement.

After stuffing - CBT is sealed by customs and stuffing report is made on Shipping Bill.
Export General Manifest (EGM) - 6 copies Transit Permit (TP)-6 copies and Inland Way
Bill (IWB), 3 copies are prepared by DL and endorsed by customs.

Export General Manifest: - prepared by DL. It is a summary of all the cargo that is loaded
onto the truck. It is for reference of customs at Mumbai.

Transit permit: - is prepared by DL and signed by customs, stating that loaded truck is
heading towards SACC (Sahar Air Cargo Complex)

Transference Copies, EGM (1 copy), TP (1 Copy) are put in the envelope and sealed
by Customs Pune for Airport Customs. The sealed envelope is handed to transporter and
Octroi formalities fulfilled after which the vehicle is allowed to leave for the air port.

Deepak Mundada

Page 33

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

GENERAL IMPORT PROCEDURE THAT IS FOLLOWED

ENQUIREY THE IMPORTER
INFORMATION AS PER THE QUATATION BY THE
EXPORTER
CONFORMATION OF THE PURCHASE ORDER BY
THE IMPORTER
EXPORTER PREPARES THE DOCUMENTS AND
SENDS THE BILL OF LADING THROUGH BANK TO
THE IMPORTER
IMPORTER MAKES PAYMENT TO THE EXPORTER
THROUGH THE BANK
IMPORTER RECEIVES DOCUMENTS FROM THE
BANK AND HAND THEM OVER TO THE CHA
ON THE BASIS OF THE SAME CHA FILES FOR THE
BILL OF ENTRY
MEANWHILE GOODS REACH THE DESTINATION
(IMPORTERS COUNTRY)
THEN THE BILL OF ENTRY NUMBER IS RECEIVED
FROM THE CUSTOMS
C
DESTUFFING TAKES PLACE, ASSESMNET TAKES
O
Deepak Mundada
Page
34
Dynamic
Logistics,
ICD
Dighi.
N
PLACE AND AUDITING TAKES PLACE AND
T
ASSASMENT OF THE DUTY PAYABLE IS

CALCULATED

Internship Report
Pune

IMDR,

AFTER THIS DUTY PAYMENT IN THE BANK

THROUGH THE TR6 CHALLAN

EXAMINATION TAKES PLACE, OUT OF CHARGE

GIVEN BY THE CUSTOMS

PAYMENT OF THE OCTROI, AND GOODS REACH

TO THE DESIRED LAOCTION OF THE IMPORTER

IMPORT DUTIES AND DOCUMENTS

Customs duties are levied on the goods as per rates specified in the schedule to the customs
tariff. Import duty is charged practically on all the items except food-grains, fertilizers, life
saving drugs and equipment etc.
Basic Duty: It may be at the standard rate or in the case of import from some countries, at the
preferential rate.
Additional Customs Duty: This is equal to excise duty leviable on like goods produced or
manufactured in India. It is commonly known as countervailing duty or CVD. Additional duty is
charged for import of specific items from specified countries with a view of protecting domestic
industry from unfair injury.
Customs Duties: Most of the customs duties are ad Valerom. Valuation of goods for customs
purposes is done as per the principles laid down in the customs valuation (determination and
prices of imported goods) rules 1988. When goods attract specific rate of duty, there is no
problem but when duty is ad Valerom, customs and importers have disputes on value of goods.

Deepak Mundada

Page 35

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
Customs value the goods in terms of section 14 of the customs act, 1962 for the determining the
customs duty.
Exemption & Cess: The central government can exempt any specified goods from the levy of
custom duty generally or by special order either absolutely or conditionally in
public interest. Similarly, certain cess is leviable on specified articles as duties of
customs and is passed on to the administering agencies nominated under the
respective statutes
.

Documents Involved in Imports:

Bill Of Entry: The Bill of Entry is the document on the strength of which clearance of
imported goods can be done. The form of the Bill of Entry has been standardized by the Central
Board of Excise and Customs. As soon as the importer receives the advice of arrival of the vessel
the importers are required to present a document known as Bill of Entry, either for Home
Consumption or for warehousing the goods. The Bill of Entry is noted in the Import Department.

Types of Bill of Entry:

1) Goods Entered for Home Consumption are cleared on White Bill of Entry.
(Form No. 22) It is to be submitted when the imported goods are to be cleared on payment of
full duty for consumption of the goods in India
2) Goods entered for warehousing are removed 'into bond on Yellow colour In-Bond Bill of
Entry. (Form No. 23) It is to be submitted when the imported goods are not required
immediately the importer but here they are to be stored in a warehouse without payment of
duty under a bond and cleared later when required on payment of duty. This enables the
importer to defer payment of Customs Duty until the goods are actually required by him.
3) Goods cleared ex-bond for Home Consumption on payment of duty on Green colour EXBond Bill of Entry.( Form No. 24) It is used for clearing goods from the warehouse on

Deepak Mundada

Page 36

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
payment of duty. The goods are classified and valued at the time of clearance from the
Customs Port. Value and classification are not determined on such Bill of Entry.
The rate of duty payable is that rate which is applicable on the date of removal of goods from the
warehouse
For preparing the bill of entry the documents that are required are as follows:
1) Invoice
2) Packing List
3) Bill of Lading
4) DO (Delivery Order)
5) Purchase Order
6) Certificate of Origin
7) License copy, Bond certificate (If required)

COMMERCIAL INVOICE AS AN IMPORTANT DOCUMENT

The invoice must include at least the following information:
Seller's complete name, postal address, and telephone and fax number and bank

information
Invoice number and date
Seller's reference, business ID, foreign trade number (UVN)
Buyer's reference, order number and date
Full name and address of the buyer (and addressee, if not the same)
Name and address of the recipient of the goods
Country of origin of the goods
Country of destination
Transport information, e.g. method, route
Terms of delivery (e.g. CIF New York, Inco terms 2000)
Time and method of delivery
Terms and method of payment
Marks, codes, number and type of packages

Deepak Mundada

Page 37

Dynamic Logistics, ICD Dighi.

Internship Report
IMDR,
Pune
Exact definition of goods
Customs tariff designation, in most cases a 6-digit HS designation
Quantity of goods: Units according to the trade practice, gross and net weight, other units
required by the customs tariff of the purchasing country.
Price information of the goods in the agreed currency, unit and total prices by types of
goods
Discounts and/or any additional charges with their criteria
Exporter's signature and name clarification.

Deepak Mundada

Page 38

Dynamic Logistics, ICD Dighi.

Internship Report
Pune

IMDR,

BIBLIOGRAPHY
www.dynamiclogistics.com
www.cbec.gov.in
www.tradeindia.com
notes taken during training sessions

Deepak Mundada

Page 39

Dynamic Logistics, ICD Dighi.