ACCREDITED CLIENT PROGRAMME

[Mr. M. GOVINDARAJAN]

The Central Board of Excise and Customs introduced a Risk Management based solution for cargo clearance process. The object is to strike an optimal balance between the concerns of facilitation on the one hand and enforcement on the other. The Risk Management system (RMS) will enable the department to enhance the effectiveness of the resources at its disposal by focusing them on high risk areas. The main risks identified by the Department are:

• Threat to national security, public safety and health;

• Threat to revenue arising from misdeclaration of goods, under valuation, misclassification of goods or erroneous claims of exemptions;

• Threat to the economy by evasion of duties like anti-dumping or safeguard duties etc.,

• Smuggling of prohibited articles.

The Accredited Client Programme (ACP) is a major element of the risk management strategy of the department. The clients who are assessed as highly compliant would be given assured facilitation. One of the objectives of the Department is to create a climate of voluntary compliance which can be created by developing a relationship of trust between the department and its clients. This programme will provide recognition and the incentive of facilitation to clients who maintain high levels of compliance. taxmanagementindia.com

This program gives the following benefits:

• The clients will get assured facilitation;

• In a small number of occasions their consignments will be randomly selected for checks by customs officers;

• The Indian Customs EDI system will accept the declared classification and valuation and assess duty on the basis of importers’ self-declaration;

• They will also not be subjected to examination;

• It will be ensured that their cargo is delivered quickly;

• These benefits are applicable at all ICES locations.

The eligibility criteria for this program is-

• One should have imported goods valued at Rs.10 crores (assessable value) in the previous financial year or paid more than Rs. one crore of customs duty in the previous financial year; or in the case of importers who are also central excise assessees paid central excise duty over Rs. one crore from the Personal Ledger Account in the previous financial year; or they should be recognized as status holder under the Foreign Trade Policy;
• One should have filed at least 25 Bill of Entry in the previous financial year in one or more Indian Customs Stations;
•  One should have no cases of Customs, Central Excise or Service Tax booked against him in the previous three financial years;
• One should not have any cases booked under any of the allied acts being implemented by customs;
• The quality of the submissions made by the applicant to Customs should be good as measured by the number of amendments made in the bills of entry submitted by him in relation to classification of goods, valuation and claim for exemption benefits.The number of such amendments should not have exceeded 20% of the bills of entry during the previous financial year;
• One should have no duty demands pending on account of non-fulfillment of export obligation;
•  One should have reliable systems of record keeping and internal controls and his accounting systems should conform to recognized standards of accounting.He is required to provide the necessary certificate from the Chartered Accountants in this regard as per format given in the application form.

The conditions for getting ACP are as follows:

o Continued maintenance of the required compliance levels;

o One shall make the duty payments for all his bills of entry through his account only at the designated bank. No payment shall be made in any other mode.

The ACP requirement is that a certain minimum level of quality in terms of completeness, accuracy and validity in the data submissions made by the importers is there.

The Department issues public notices from time to time to address deficiencies in data quality. It is the expectation of the Department from the Accrediting clients that they have in place mechanisms to ensure that their declarations invariably meet the standards specified by the Department. It is also expected that accredited clients to play a more pro-active role in supply chain security to provide assurance against unauthorized use of the facility granted to them and the risk of contraband being smuggled.  They have to take due care in the selection of agents and personnel engaged in the supply chain. 

One who wants to register he should apply in the prescribed application and fill all the columns correctly and subscribe to the declaration under the form and file the application with the Commissioner of Customs in charge of the port/airport or ICD through which he effects his imports. The Commissioner, after scrutiny of the application, will forward the same to the Risk Management Division, which has the authority to take the final decision. The decision on the application will be made within four weeks of the submission of the application. If it is approved the same will be informed to the applicant and the sponsoring Commissioners and include the applicant in the ACP database. 

The ACP permission is valid for one year unless revoked for reasons of non-compliance or violations. The same may be extended on a case to case basis by a screening committee based on review of the continuing compliance record.  The Department is having right to stop and examine the consignments if there are valid and adequate reasons for doing so.  In case of non-compliance persists the benefits would be liable to be curtailed or revoked. The benefits are also likely to be curtailed or revoked if the Department notes a serious and persistent failure to comply with the prescribed requirement. 

Now there are 318 Accredited Clients are registered with the Department all over India.