Customs, Regulatory and Compliance Documentation
Domain 6 - Customs, Regulatory and Compliance Documentation
This domain tests the mandatory registrations and declarations for cross-border trade, correct classification, and duty computation.
Core rules
- IEC from DGFT is the basic licence for commercial imports and exports.
- HS classification (8-digit Indian Customs Tariff) sets the duty rate and any policy condition; a wrong code is a compliance failure even when duty is paid.
- Bill of Entry (Customs Act 1962, s.46) is filed on ICEGATE; the rate of duty is generally the rate in force on the date the BOE is presented.
- Shipping bill (s.50) precedes the Let Export Order; goods cannot be loaded without it.
- Licences and clearances: FSSAI for food, BIS for quality-control-order goods, CDSCO for drugs, plant quarantine for agricultural goods.
- Exporters may ship under LUT without paying IGST and claim RoDTEP or duty drawback.
Worked example
Assessable value ₹1,00,000; BCD 10%; SWS 10% of BCD; IGST 18%.
- BCD = ₹10,000
- SWS = 10% of ₹10,000 = ₹1,000
- IGST base = 1,00,000 + 10,000 + 1,000 = ₹1,11,000 → IGST = ₹19,980
- Total duty and tax = 10,000 + 1,000 + 19,980 = ₹30,980
Reasoning: SWS is levied on BCD, not on assessable value; IGST is levied on value plus customs duties, which is why its base exceeds the invoice value.
Traps
- Computing SWS on the assessable value.
- Charging IGST on assessable value alone.
- Using the vessel arrival date for the duty rate instead of the BOE presentation date.
- Assuming an IEC also covers food or drug imports without FSSAI or CDSCO clearance.