Mis­use of gift route to im­port goods un­der cus­toms depart­ment scan­ner

Mint Asia ST - - Inside - BAY SIT R ANJAN M ISHRA

Cus­toms

au­thor­i­ties have clamped down on the im­port of Chi­nese goods en­ter­ing In­dia in the guise of ‘gifts’ by mis­us­ing the ex­ist­ing e-com­merce rules. The Mum­bai Cus­toms of­fice told its of­fi­cers at the Air­port Spe­cial Cargo Com­mis­sion­er­ate to check such “mis­dec­la­ra­tion and smug­gling of goods im­ported through couri­ers”.

In­dian cus­toms reg­u­la­tions cur­rently al­lows tax ex­emp­tions on gifts sent to rel­a­tives from In­di­ans liv­ing abroad for up to ₹ 5,000. How­ever, China-based online e-com­merce plat­forms, such as Club Fac­tory, Shein and Aliex­press, have been mis­us­ing the rules and ship­ping cheaper prod­ucts to In­dian cus­tomers as gifts, thus avoid­ing cus­toms duty and goods and ser­vices tax.

Fol­low­ing com­plaints from sev­eral quar­ters, in­clud­ing online lo­cal com­mu­ni­ties plat­form Lo­calcir­cles and Rashtriya Swayam­se­vak Sangh (Rss)-af­fil­i­ated Swadeshi Ja­gran Manch, Union trade and com­merce min­is­ter Suresh Prabhu had as­sured to take prompt ac­tion.

China Post, the state-owned of­fi­cial postal ser­vice of China, is also heav­ily sub­si­diz­ing pack­ages shipped to In­dia keep­ing over­all costs lower. Many Chi­nese en­ti­ties are not reg­is­tered as busi­nesses in In­dia, ruling out scope for griev­ance re­dres­sal or re­turns by In­dian cus­tomers.

“As­sess­ment and clear­ance of goods at the courier cell/ter­mi­nal, APSC is al­lowed only if the goods and doc­u­ments are ac­tu­ally trans­ported by air, by a per­son en­gaged in the in­ter­na­tional trans­porta­tion of goods or doc­u­ments on door-to-door de­liv­ery ba­sis. Per­sons en­gaged in the work merely of cus­toms agents/bro­kers or clear­ing agents are nei­ther eligible to be reg­is­tered as au­tho­rized courier nor are the CEDPR, 2010, ap­pli­ca­ble to goods cleared by such cus­toms agents/bro­kers,” an or­der by the Of­fice of the Com­mis­sioner of Cus­toms re­viewed by Mint showed.

CEDPR stands for Courier Im­ports and Ex­ports (Elec­tronic Dec­la­ra­tion and Pro­cess­ing) Reg­u­la­tions.

A Mum­bai-based cus­toms of­fi­cial, re­quest­ing anonymity, said if im­ported goods are not bona fide gifts, cus­toms of­fi­cials will seize the con­sign­ments.

“It should be es­sen­tially com­ing from a per­son as a gift for per­sonal use. There should not be any cost to the per­son in In­dia. All of us have rel­a­tives abroad who would send gifts on spe­cial oc­ca­sions like Di­wali or birthdays, which are ex­empted from cus­toms du­ties up to ₹ 5,000.”

“The mis­use of the gift chan­nel by Chi­nese e-com­merce apps was cre­at­ing an un­fair play­ing field, risk­ing to wipe out the small and medium en­ter­prises sec­tor in In­dia. We are glad that Mum­bai cus­toms au­thor­i­ties have de­cided to rein in such mis­use,” said Sachin Ta­paria, founder and chair­man, Lo­calcir­cles.

The cus­toms of­fi­cial cited above said such Chi­nese com­pa­nies are free to get gen­uine li­cences to ship goods to In­dia as com­mer­cial con­sign­ments.

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