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'Indian Customs laws on abandoned cargoes are unclear, used in brazen manner'
October, 16th 2012

One of the biggest nightmares for a liner shipping company is the fear that a cargo destined for an Indian port may be abandoned after landing and that it would not be able to recover the costs. This fear is genuine because abandonment of cargoes has now become rampant. In most cases the problem is associated with low-valued cargoes like waste oil, grease, used rubber tyres, scrap, old packaging material, waste paper, etc. While most of these products are imported for a genuine purpose there are some that may not have sufficient documents to prove they are bonafides.

The law in India is so unclear that the authorities use this, unfortunately, in such a brazen manner that leaves the shipping line owners tearing their hair in despair.

According to the Customs Department, goods that lie uncleared for 30 days in a Customs area (i.e. Major Port or a Non-major port, CFS, ICD etc) may be disposed off. The Major Port Trusts Act, 1963 states that goods that lie uncleared in port (read Major Port) for 60 days may be disposed off. The Tariff Authority for Major Ports (TAMP) permits auctioning of abandoned goods after 75 days. Do not include Mumbai, Kandla and Kolkata because these three ports do not follow TAMP directives. If you go to TAMP and inform that Kolkata, Mumbai and Kandla are not following your directives , it will say - "we are meant to make a law, but cannot force anyone to follow it!!!"

According to a Parliamentary Panel which went into the issue of "longstanding containers" in India (there are about 18500 TEUs of abandoned containers lying in Indian Ports, ICDs, CFSs etc) the method of disposing the longstanding containers was "working well."

According to the procedure of the Customs, four attempts should be made to auction off the cargoes in order to obtain the reserve price. But, if the reserve price is not reached, then the goods can be sold at any price at the fourth auction. Recently, according to the Customs, the auction should be attempted "ten times" and if reserve price is not reached, the goods should be "re-assessed" and auctions re-started . A new "Maritime Agenda" by Customs?

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