Executive Summary

As a partial fulfillment of PGDM I was required to undergo training for 2 months. With respect to that this I have prepared this project report on “Export Import procedure and documentation” undertaken at Transformer & Rectifiers (I) ltd , A’bad.

I have selected this topic to know about the Export-Import procedure and custom process. Another objective is to know Documentation process done by CHA (Clearing House Agent) to clear the goods from CUSTOM.

My secondary objective is to know the relation between CHA and importer as well as exporter.

This report also tells that as that how to calculate the DUTY on import-export goods. I also describe that which Documents are useful for CHA, IMPORTER and EXPORTER.

Objectives Of The Study

To know the import export procedure in detail. To know the warehousing process and processes while importing and exporting. To know the documentation process done by the CHA. To analyze the market potential for providing the services related with import export to the

customers. To know Import & Export industry very well. To know the requirement of the customers To know the Documentation part. To analyze the current situation of Transformer market To know about market movement To analyze the current services and their application

.

Contents

1. Acknowledgement

2. Organization Profile Company profile Product and Financial data

3. Container information

4. Export procedure

5. Import procedure

6. Export import documentation

7. Performa of documents used in export and import

8. Data analysis and representation

9. Suggestion

10. Conclusion

11. Bibliography

12. Questionnaire

Acknowledgement

No creation in this world is a solo effort. Neither is this summer project. This project could never succeed without the help of my faculties and all the TARIL staff. I want to thank to my college who gave me the opportunity to carry out a summer project in my desired area of study. I want to thank all the TARIL staff who gave me full support throughout the project and impart me with all the knowledge required to make this project successful.

I would like to thank mainly to the following persons:

Mr. Satyam Sir

Mr. Darshan Shah

Mr. Jagir Mehta

Mr. Ashok Sir

And of course all the employees of different the dept. whose support and direction throughout training was very helpful………………..

Company Profile

Transformers & Rectiffiers (India) Ltd.An ISO 9001:2008 Company

Established at Odhav, Gujarat in 1981

More than 5500 transformers installed globally

Manufacturers of Quality Power, Distribution and Furnace Transformers

Having Experience of more than 28

Head Office:

Survey No. 344 To 350,Opp. PWD Stores, Sarkhej Bavla Highway, Changodar ,A”bad-382210

HISTORY

Incorporated in 1981, Transformers & Rectifiers (I) Limited has consolidated its position in the Indian Transformer Industry as a manufacturer of a wide range of transformers, which conform to the quality expectations of both the domestic and the international market. An ISO 9001:2008 company today, T & R as it is more popularly known, is proud to have executed more than 6000 installations worldwide with the capability grown up to the manufacturing of 800 MVA and 765 KV class transformers.

Since last one decade, the location of Company’s Corporate Office & Works is at Changodar, Gujarat which is very close to the city of Ahmedabad and Gandhinagar. This location has further benefit of proximity to Mumbai, an important city of India and financial center of the country. This facility is equipped with world class state of the art equipment and managed by a high skilled and experienced team of production personnel who consistently ensure that each and every production activity factors in an adherence to the high quality benchmarks established by the organization.

Added to this, company’s certification as an ISO 9001:2008 company and Star Export House has enabled the company to expand its clientele list which has reached to an international level also. Company has an export business to over 25 countries includes Canada, USA, UK, GCC and some leading Asian and African markets. Company’s turnover which was 4.7 million US $ in 2001 has grown to over 100 Million US $ in 2009-10.

On the way towards the path of progress company has set one more benchmark by setting a new manufacturing unit, a green field project, to facilitate manufacturing of transformers up to 800 MVA and 765 kV class. Spread over 69,000 sq. meters and built up area of 14,500 sq. meters, this would be our largest and one of India’s most advanced Transformer manufacturing infrastructure in Moraiya near Ahmedabad.

A Value Based Organisation

As one of India’s leading transformer manufacturing companies, and one that is held in high esteem even by company’s competitors, a great deal of relevance is attached to living up to our image as a value based organization. It is an ethically responsible company, operating with transparency, validating commitment and sincerity, both vertically and horizontally across the organization and inculcates a spirit of integrity. Company also tries and extends these values to the business associates, be it vendors or the valued customers

Vision

To consolidate our National and International presence as a leading manufacturer of

Power, Furnace and Rectifier TransformersAnd maintain an average annual growth rate of 50%

Mission

To emerge as a preferred solution provider forQuality Transformers with a team of dedicated professionals

and business associates who are ethical, value drivenAnd create excellent customer relationships

Developed Ancillary unit for

Manufacturing of Radiators Manufacturing of Transformer Tanks Manufacturing of Distribution transformers till 5.0 MVA; 66 kV class Repairing of Transformers till 10 MVA; 66 kV class

Future Plan

The Company already enjoys the privilege of being a well-known supplier to all State Electricity Boards in the country and number of private industries. Also the Company has tasted the success in the Global Market and has exported products to various foreign utilities and industries. Export would continue to be the thrust area but with the greater accent on expanding the world market especially foraying into Europe, North America, Middle East, Africa countries and Asia.

Being an engineering firm with more than 200 man years of experience, diversifying towards providing of total power solutions of Substations and Transmission upto 400 kV will be a major essence and core area where the company will be focusing on.

The Company intends to continue the progress and intends to widen its base in manufacturing better Products-technically and economically. We assure that GROWTH is the ESSENCE of life and to compete in 21st century, the company would continuously endeavors to remain in step with the times, positively responding to changes in and around the business world.

Products

Power Transformer – up to 800 MVA (Auto) 765 kV class

Station Auxiliary Transformer Interconnecting Transformer Auto Transformer Trackside Transformer for Railways Generator Transformer Unit Auxiliary Transformer

Distribution Transformer - 160KVA, 11KV/0.433KV & above ratings

Rectifier Transformer up to 320 KA DC

Twelve pulse with IPT (Double Deck Construction) Six pulse transformer with IPT Bridge Connection For

Railway Traction

Furnace Transformer – up to 230 KA

Arc Furnace Transformer Submerged Arc Furnace Transformer Ladle Furnace Transformer Induction Furnace Transformer DC Arc Furnace Transformer

Specialty Transformer & Reactors up to 200 KV

Manufacturing Facilit y

Location & Infrastructure:

Changodar and Moriya, 15 km from Ahmedabad, a leading industrialized city of India and located on the western region. Connected by road to Mumbai & Delhi and has an international airport with Direct Flights to major destinations worldwide.

Our main works at Changodar is spread over an area of 25,000 sq. meters, with a built up area of 7,200sq. meters., and the factory at Moraiya is spread over 69,000 sq. meters., with a built up area of 14,500 sq. meters, we have the world class state of art facilities to design, manufacture, test and deliver all kinds of the transformers up to 800 MVA, in 765 KV class. These facilities include EOT cranes of 100 Ton capacity, Winding machines up to 3.5 meters and 8 tons, Vapor phase chamber of 130 mt. - cube suitable to achieve 0.5 ton hydraulic press of 200 ton capacity and Thermic Fluid bed heater of 3000Kcal.

The combined manufacturing capacity of both the plants is over 20,000 MVA per annum.

Testing Facility:

The testing facilities enable us to perform all routine, type and special tests, including impulse test up to 2800 KVp (Impulse Generator of Haefely make, Switzerland) as per IS-2026, IEC-76 and other international standards. We have conducted Heat Run Test up to 200 MVA Transformer.

Capacitor Bank for Load Loss Test for higher capacity and Voltage Divider for higher Voltage Test.

These testing facilities which are available with only few organizations in India, enables us to manufacture state of the art transformers for domestic and export markets.

Company Milestones

1981-94

Transformers & Rectifiers (India) was established with installed capacity up to 600 MVA and 66 kV class per annum

First 33 kV, 3.15 MVA Transformer designed and executed in 1984

Started manufacturing Furnace Transformer and Established the market share of approximate 80 % in Induction Furnace and Steel melting transformer till 1994

1995-2000

Expanded with State of Art New manufacturing plant with Built up area of 7000 sq. mtrs. (approx. 75,000 sq. ft.) and total area of 25,000 sq. mtrs. (269,000 sq. ft.) for manufacturing transformers up to 160 MVA, 245 kV class

Executed first 66 kV Power Transformer having capacity of 15 MVA

Executed first 110 kV Power Transformer, 30 MVA

Obtained ISO:9000:1994 Certification

Executed first 132 kV, 50 MVA, Power Transformer

Executed first 220 kV, 50 MVA, Power Transformer

2001-05

Received PGCIL (Power Grid Corporation India Limited) Approval

Executed 100 MVA; 245 kV class Power Transformer for GEB

Executed one special testing transformer for ABB of 30 MVA; 11/2-90 kV 5600 kVA and 3300 kVA; 11/0.940 kV. LV consist of 40 secondaries each of 940 V for Institute of Plasma Research

Re-certified for ISO:9001:2000 valid up to 2007

Executed one 35 kA Rectifier Duty Transformer for Alstom a/c Sterlite

11 kV Series Reactors with Short Circuit capacity of 105 kA, supplied to Flure Daniel, UK and installed in Kazakhstan

2 nos. 75 MVA; 245 kV class Transformers for Wind Power evacuation in Rajasthan for Suzlon executed

2 nos. of 50 MVA; 245 kV class Transformers for MSEB

Executed bulk quantity of 22 nos. of 25 MVA; 132 kV Transformer for RRVPNL

Executed bulk order of 40 nos. 16 MVA; 110 kV, HV Delta connected for TNEB

Engineering, Manufacturing, supply and Installation of Station, UAT, Station AT’s worth US $ 5 Million upto 80 MVA; 132 kV class for total of 72 transformers executed

2 nos. of 100 MVA; 220 kV; 3 Phase Auto and 4 nos. 33 MVA; 220 kV, 1 Phase Auto transformer for PGCIL executed

2005-06

4 nos. 50 MVA, 230 kV Transformer for wind power evacuation a/c NEG-MICON-TNEB-commissioned

2 Nos. 100 MVA, 245 kV class Transformers for Siemens supplied

2 Nos. 100 MVA, 245 kV class; 9 Nos. 50 MVA, 132 kV class Transformers for TNEB

3 Nos. 50 MVA, 132 kV class supplied to Enercon a/c MSEB

3 Nos. Rectifier Transformer for Sterlite a/c ABB executed

2006-07

5 Nos. 100 MVA, 245 kV class Transformers for GETCO supplied

5 Nos. 50 MVA, 132 kV class Transformers for TNEB supplied

1 Nos. 100 MVA, 245 kV class and 12 nos. 20 MVA, 110 kV class Transformers for KPTCL supplied

2 Nos. 100 MVA, 245 kV class Auto Transformer for AP Transco supplied

2 Nos. 100 MVA, 220kV Transformer for Siemens a/c KPTCL supplied

80 MVA, 132 kV Transformer successfully tested at CPRI Bangalore for Dynamic Short Circuit Test

2 Nos. 80 MVA, 132 kV Transformer supplied to NTPC

3 Nos. 18.5 MVA Rectifier Transformer supplied to Hindalco a/c ABB

1 Nos. 2 MVA, Rectifier Transformer executed for HZL

2007-09

1 Nos. 100 MVA; 245 kV class Transformer for MPEB under execution

4 Nos. 50 MVA, 132 kV class Transformer for TNEB executed

3 Nos. 90 MVA; 132 kV class split winding for NTPC under execution

11 Nos. 100 MVA; 245 kV class Auto Transformer for TNEB executed

1 Nos. 100 MVA, 245 kV class and 12 nos. 20 MVA, 110 kV class Transformers for KPTCL supplied

1 Nos. 100 MVA, 245 kV class Auto Transformer for AP Transco supplied

2 Nos. 100 MVA, 220 kV; 3 Phase Auto and 4 Nos. 33 MVA, 220 kV, 1 Phase Auto Transformer for PGCIL under execution

2 Nos. 100 MVA, 245 kV class; 9 Nos. 50 MVA, 132 kV class Transformers for TNEB executed

Received order for 12 Ns. 60 MVA, 132/33 kV Power Transformer for Nigeria

Received order for 5 Ns. 26 MVA, 33/11 kV Power Transformer for Ghana

Successful Dispatch of first 200 MVA Transformer

Successful Dispatch of first 400 kV Transformer

Financial Data

Particulars FY 08 FY 09Net Sales 30570 43050Other Income 591 1080PAT 3522 4581PAT Margins 12% 11%

Particulars FY 08 FY 09 % ChangeRevenue 30764 43548 42Sales 30186 42598 41EBIDTA 6096 7509 23PBT 5134 6565 28PAT 3310 4412 33

70%

4%

7%

3%

16%

Order Book as on 28th April 2010

Power TransformersDistribution TransformersFurnace TransformersRectifier TransformersExport

18.6532

55.25

76.25

105

0

20

40

60

80

100

120

2004-05 2005-06 2006-07 2007-08 2008-09

Sales in Million US $

23003150

46005700

8000

0150030004500600075009000

2004-05 2005-06 2006-07 2007-08 2008-09

GROWTH IN MVA

Annual Production in MVA

Quality Policy:

T & R perceives itself as a world class manufacturer of Transformers by establishing stringent quality norms in a vibrant environment that:

Values Continuous improvement.

Develop the best resource partner.

Nurtures employees’ skills & performance.

Inculcates a high standard of quality.

Believes in team work.

Team of professionals:

• Total Manpower: 1200

• Managerial: 30

• Technical: 85

• Shop Floor:975

• Support Functions: 60

Types of containers

There are different types of containers. The popular types are:

1. General purpose containers-:

There are the most common type of containers and are the ones with which most people are familiar. Each general-purpose container is fully closed and has width doors at one end for access. Both liquid and solid substances can be loaded in these containers. Based on length of the container, the container is generally known as a 20 ft container or 40 ft container, in practice. Hazardous or dangerous cargo can not be loaded into general-purpose containers.

2. Reefer containers (refrigerated) -:

These play an important role in South - Africa’s exports of perishable products, and are designed to carry cargoes at temperatures reading down to deep frozen. For refrigeration, they are fitted with electrical equipment for supply of necessary electricity.

3. Dry bulk containers-:

These are built especially for the carriage of dry powders and granular substances in bulk.

4. Open top/open sided containers-:

These are built for heavy and awkward pieces of cargo. These containers are ideal where height of the cargo is in excess of height of the standard general purpose containers.

5. Liquid cargo containers-:

These are ideal for bulk liquids, such as wine, fruit concentrates, vegetable oils, detergents and various other non-hazardous chemicals. Bulk liquid bags, designed to carry specific commodities, can fit into these containers.

6. Hanger containers-:

They are used for the shipment of garments on hangers.

CONTAI NER I NFORMATI ON

40 FT. STANDARD CONTAINER

Dimensions: Length Width Height

Overall40' = 12192 mm 8' = 2438 mm 8' 6" = 2591 mm

I nternal39' 5.25" = 12022 mm 7' 5.625" = 2352 mm 7' 10.25" = 2395 mm

Door Opening7' 8.25" = 2343 mm 7' 5.75" = 2280 mm

Weights:

Max. Gross 67200 lbs = 30480 kg

Tare 8600 lbs = 3900 kg

Max. Payload 58600 lbs = 26580 kg

Cube: 2392 cu. ft. = 67.7 m3

Generally containers are of two size are used mainly i.e. 20’FT and 40’FT. Each container has a

no. assigned to it either it is of 20’FT or 40’FT.

Standard containers High-cube containersHard-top containers

Open-top containers

Flatracks Platforms (plats)Ventilated containers

Insulated and refrigerated containers

Bulk containers Tank containers

CONTAINER INFORMATION

40 FT. "High Cube"

Dimensions: Length Width Height

Overall40' = 12192 mm 8' = 2438 mm 9' 6" = 2895 mm

I nternal39' 3.25" = 12022 mm 7' 8.5" = 2352 mm 8' 10.25" = 2700 mm

Door Opening7' 5.75" = 2340 mm 8' 5.75" = 2585 mm

Weights:

Max. Gross 67200 lbs = 30480 kg

Tare 9150 lbs = 4150 kg

Max. Payload 58050 lbs = 26330 kg

Cube: 2697 cu. ft. = 76.4 m3

Export Procedure

Concept:

Export procedure consists of several commercial and regulatory formalities, which an exporter is required to complete during the course of export trade transactions. These formalities are very complex and time-consuming and involve considerable documentation. Hence, the exporters must possess adequate knowledge of such formalities. At the same time, it should be ensured that the rules and regulations of not only exporting country but also of importing country are duly complied with. Last but not the least, it should be ensured that all the required documents, whether commercial or regulatory, are prepared and filed with the appropriate authorities.

An export procedure can be studied under the following heads:-

1. Registration Stage2. Pre-Shipment Stage3. Shipment Stage4. Post-Shipment Stage

1. Registration Stage

The exporter is required to register his organization with a number of institutions and authorities, which directly or indirectly help him in the smooth conduct of export trade. The registration stage includes:

a) Registration of the OrganizationThe form of organization selected by the exporter must be registered under the appropriate Act of the country.

A joint stock company under the Companies Act, 1956 A partnership firm under the Indian Partnership Act, 1932 A sole trader should seek permission from the local authorities, as required.

b) Opening Bank AccountThe exporter should open a current account in the name of the firm or company with a commercial bank which is authorized by the Reserve Bank Of India (RBI) to deal in foreign exchange. Such bank also serves as a source of pre-shipment and post-shipment finance for the exporter.

c) Obtaining Importer-Exporter Code Number (IEC No.)Prior to 1.1.1997, it was obligatory for every exporter to obtain CNX number from the RBI. However, since then, the CNX number has been replaced by IEC number issued by the Director General for Foreign Trade (DGFT). The application form for obtaining IEC number should be accompanied by fee of Rs.1000.

d) Obtaining Permanent Account Number (PAN)Export income is subject to a number of exemption and deductions under different sections of the Income Tax Act. For claiming such exemptions and deductions, the exporter should register his organization with the Income Tax Authorities and obtain the Permanent Account Number (PAN).

e) Obtaining Sales Tax NumberExportable goods are exempted from sales tax, provided the exporter or his firm is registered with the Sales Tax Authorities. For this purpose, the exporter is required to make an application in the prescribed form to the Sales Tax Office (STO) in whose jurisdiction his (exporter’s) office is situated.

f) Registration with Export Promotion Council (EPC)It is obligatory for every exporter to register with the appropriate Export Promotion Council (EPC) and obtain the ‘Registration-cum-Membership Certificate ‘ (RCMC). The benefits provided in the current EXIM Policy are extended only to the registered exporters having valid RCMC.

g) Registration with ECGCThe exporter should also register with the Export Credit and Guarantee Corporation of India (ECGC) in order to secure overseas payments against political and commercial risks. It also helps the exporters in obtaining the financial assistance from commercial banks and other financial institutions.

h) Registration with other AuthoritiesThe exporter should also register with various other authorities, such as:

- Federation of Indian Export Organization (FIEO),

- Indian Trade Promotion Organization (ITPO)

- Chambers of Commerce (COC),

- Productivity Councils, etc.

2. Pre-Shipment Stage

Pre- shipment stage consists of the following steps:-

a) Approaching Foreign BuyersIn order to secure an export order, a new exporter can make use of one or more of the techniques, such as, advertising in international media, sales promotion, public relation, public selling, publicity and participation in trade fairs and exhibition

b) Inquiry And OfferAn inquiry is a request from a prospective importer about description of goods, their standard or grade, size, weight or quantity, terms of payments, etc. on getting an inquiry, the exporter must process it immediately by making an offer in the form of a proforma invoice.

c) Confirmation of OrderOnce the negotiations are completed and the terms and conditions are finalized; the exporter sends three copies of proforma invoice to the importer for the confirmation of order. The importer signs these copies and sends back two back copies to the exporter.

d) Opening Letter of CreditThe documentary credit or letter of credit is the most appropriate and secured method of payment adopted to settle international transactions. On the finalization of the export contract, the importer opens a letter of credit in favour of the exporter, if agreed upon in the contract.

e) Arrangement of Pre-shipment financeOn securing the letter of credit the exporter procures a pre-shipment finance from his bank for procuring raw materials and other components, processing and packing of goods and transfer of goods t the port of shipment.

f) Production or Procurement of goodsOn securing the pre-shipment finance. From the bank, the exporter either arranges for the production of the requirement goods or procures them from the domestic market as per the specification of the importer.

g) Packing and MarkingThen the goods should be properly packed and marked with necessary details such as port of shipment and destination, country of origin, gross and net weight, etc. if required assistance can be taken from Indian institute of Packing (IIP)

h) Pre-shipment InspectionIf the goods to be exported are subject to compulsory quality control and pre-shipment inspection then the exporter should contact the export inspection agency (EIA) for obtaining ang inspection certificate.

i) Central Excise ClearanceThe exporter is totally exempted from the payment of central excise duty. However, the exemption should be claimed in one of the following ways:

- Export under rebate

- Export under bond

j) Obtaining Insurance Cover: The exporter must take appropriate policies in order to ensure risks.

- ECGE policy in order to cover credit risk.

- Marine policy, if the price quotation price agreed upon is CIF

k) Appointment of C&F agentSince exporting is a complex and time-consuming process, the exporter should appoint a clearing and forwarding (C&F) agent for the smooth clearance of goods from the Customs and preparation and submission of various export documents.

3. Shipment Stage

Export cargo can be exported t the overseas buyer by sea, air or land. However, shipment by sea is the most popular and generally resorted to, as it is comparatively cheaper. Besides, the ship’s capacity is far greater than other modes of transportation. Nevertheless, transportation by air is utilized for export of expensive items like, diamonds, gold, etc. the shipment stage includes the following steps:

a) Reservation of Shipping spaceOnce the export contract is finalized, the exporter reserves the required space in the vessel for shipment. On accepting the exporter’s request, the shipping company issues a shipping order. The original copy of the shipping order is given to the exporter and a duplicate is sent to the commanding officer of the ship. The shipping order is an instruction by the shipping company to the commanding officer of the ship that the goods are as per the details given should be received on board.

b) Arrangement of internal transportation upto the port of shipmentThe exporter makes necessary arrangements for transportation of goods to the port either by road or railways. On loading goods into the railway wagon, the railway authorities issue a ‘railway receipt’, which may be either ‘freight paid’ or ‘freight to pay’. It serves as a title to the goods. The exporter endorses the railway receipt in favour of his agent to enable him to take delivery of the goods at the port of shipment.

c) Preparation and Processing of Shipping documentsAs the goods reaches the port of shipment, the exporter should issue the detailed instructions to the C&F agent for the shipment of cargo along with a complete set of documents listed below.

- Letter of credit along with the export contract or export order.

- Commercial invoice (2copies)

- Packing list or packing note

- Certificate of Origin

- GR Form (original and duplicate)

- ARE- 1 form

- Certificate of Inspection, where necessary (original copy)

- Marine insurance policy.

d) Customs ClearanceThe cargo must be cleared from the customs before it is loaded on the ship. For this, the above mentioned documents along with the five copies of shipping bill, are to be submitted to the customs appraisal at the customs house. The customs appraisal ensures that all the formalities relating to exchange control, quality control, pre-shipment inspection and licensing have been complied with by the exporter. After verification, all the documents, except the original GR, original copy of shipping bill and one copy of commercial invoice, are returned to the C&F agent.

e) Obtaining ‘Carting Order’ from the port trust authoritiesThe C&F agent, then , approach the superintendent of concerned Port Trust for obtaining the ‘Carting Order’ for moving the cargo inside the dock. After obtaining the ‘Carting Order’ the cargo is physically moved into the port area and stores in the appropriate shed.

f) Customs Examination and Issue of ‘Let Export Order’The Customs Examiner at the port of shipment physically examines the goods and seals the packages in his presence. The same can be arranged for at the factory pr warehouse of the exporter by making an application to the assistance collector of Customs. The Custom examiner, if satisfies, issues a formal permission for the loading of cargo on the ship in the form of a ‘Let Export Order’.

g) Obtaining ‘Let Ship Order’ from the Customs Preventive Officer‘Let Export Order’, must be supplemented by a Let Ship Order’ issued by the customs preventive officer. The C&G agent submits the duplicate copy of sipping bill, duly endorsed by the Customs Examiner, to the Customs, Preventive officer who endorse it with thse ‘Let Ship Order’.

h) Obtaining Mate’s Receipt and Bill Of Lading:The goods are then loaded on board the ship for which the mate or the captain of the ship issues mate’s receipt to the port superintendent. The port superintendent on receipt of port duties, hands over the mate’s receipt to the C&F agent, the C&F agent surrenders the mate’s receipt to the shipping company for obtaining the boll of lading. The shipping company issues two to three negotiable and two to three non-negotiable copies of bill of lading.

4. Post-Shipment Stage

The post-shipment stage consists of the following steps:-

a) Submission of Documents by the C&F agent to the ExporterOn the completion of the shipping procedure, the C&F agent submits the following documents to the exporter:

- A copy of invoice duly attested by the Customs

- Drawback copy of the shipping bill

- A full set of negotiable and non- negotiable copies of bill of lading

- The original L/C, export order or contract.

- Duplicate copy of the ARE-1 form

b) Shipment Advice to ImporterAfter the shipment of goods, the exporter intimates the importer about the shipment of goods giving him details about the date of shipment, the name of the vessel, the destination, etc. he should also send one copy of non-negotiable bill of lading to the importer.

c) Presentation of Documents to Bank for NegotiationSubmission of relevant documents to the bank and the process of getting the payment from the bank is called ‘Negotiation of the Documents’ and the documents are called ‘Negotiable Set of the Documents’. The set normally contains:

- Full set of Bill of Lading or Airway Bill

- Original letter of credit

- Customs Invoice

- Commercial Invoice including one copy duly certified by the Customs

- Packing List

- Foreign exchange declaration forms, GR/SOFTEX/PP forms in duplicate

- Exchange control copy of the Shipping Bill

- Certificate of Origin, GSP or APR Certificate, etc.

- Marine Insurance Policy, in duplicate

- Bill of Exchange, Sigh Draft or Usance Draft

d) Dispatch Of DocumentsThe bank negotiates these documents these documents to the importer’s bank in the manner as specified in the L/C. Before negotiating documents, the exporter’s bank scrutinizes them in order to ensure that all formalities have been complied with and all documents are in order. The bank then sends the Bank Certificate and attested copies of commercial invoice to the exporter.

e) Acceptance of the Bill of ExchangeBill of Exchange accompanied by the above documents is known as the Documentary Bill of Exchange. It is of two types:-

Documents against Payment (Sight Drafts): In case of sight draft, the drawer instructs the bank to hand over the relevant documents to the importer only against payment.

Documents against Acceptance (Usance Draft): In case of usance draft, the drawer instructs the bank to hand over the relevant documents to the importer against his ‘acceptance’ of the bill of exchange.

f) Letter of IndemnityThe exporter can get immediate payment from his bank on the submission of documents by signing a letter of indemnity. By signing the letter of indemnity the exporter undertakes to indemnity the bank in the event of non-receipt of payment from the porter along with accrued interests.

g) Realization of Export ProceedsOn receiving the documentary bill of exchange, the importer releases payment in case of sight draft or accepts the usance draft undertaking to pay on maturity of the bill of exchange. The exporter’s bank receives the payment through importer’s bank and is credited to the exporter’s account.

h) Processing of GR FormOn receiving the export proceeds, the exporter’s bank intimates the same to RBI by recording the fact on the duplicate copy of GR. The RBI verifies the details in duplicate copy of GR with the original copy of GR received from the Customs, if the details are found to be in order then the export trans action is treated to be completed.

i) Realization of Export IncentivesIf the exporter is eligible for export incentives, then he should submit claim for the same accompanied by the bank certificate to the appropriate authority.

Lists of documents required to be submitted by the exporter to various authorities, organizations, and agencies.

1) To the custom authority:-

- Commercial invoice

- GR Form ( Original and Duplicate )

- Shippers Declaration Form

- Copy of the Export Contract /L/c/Export Order

- Inspection certificate

- AR-4 Form Export License

- Export license

- Weighment Certificate

- Shipping bill

2) To the port authorities:-

- Port Trust Copy of the Shipping Bill

- Wharf age application.

3) To the bank:-

- Letter of credit

- Commercial invoice

- Bill of lading

- Insurance Policy/Certificate

- Bill of exchange

- GR Form (duplicate copy)

- Bank certificate

- Export Inspection Certificate

- Certificate of Origin

- Shipment advice

4) To the RBI:-

- Copy of the invoice

- Sales Contract

- Bill of lading

- Inspection / Analysis Report

5) To the EXIM Bank:

- Export contract

- Letter of Contract

- Balance sheet of the exporter

- Statement of profit and loss in the transaction covered by the export contract

- Statement regarding the projections of the credit requirement.

Short shipment:

In case of short shipment customs sends the short shipment notice Annexure ‘C’ to the RBI (Reserve Bank of India) along with G R form.

Short shipment notice is in five copies:-

- Original – Customs

- Second copy – Agent

- Third copy – Exporter

- One copy – Wharf age refund

- One copy is for CESS

Treasure Challan:-

This is document is used at the time of payment of the duty to the customs. It shows the amount to be paid to the customs authority.

It is in four copies:-

- Original

- Duplicate

- Triplicate

- Quadruplicate

Customs keeps the original and duplicate copies. Triplicate and Quadruplicate copies are sent to the CHA.

Export Promotion Organizations:

Ministry of Commerce

Board of Trade

Export Promotion Councils (EPCs)

Export Promotion Council for Services

Commodity Boards (CBs)

Export Inspection Council (EIC)

Indian Trade Promotion Organization (ITPO)

Indian Institute of Foreign Trade (IIFT)

Indian Institute of Packaging (IIP)

Indian Council of Arbitration (ICA)

Federation of Indian Export Organization (FIEO)

Marine Products Exports Development Authority (MPEDA)

Export Processing Zones (EPZs)

100% Export Oriented Units (EQO’S)

M. Visvesvaraya Industrial Research and Development Center (MVIRDC)

Chamber of Commerce (COC)

Inter-state Trade Council

Import Procedure

The import procedure is quite different from the export procedure. It starts with

The importer asks for the three original bills of lading from the bank. The bank issues the bill of lading only when the importer cleared all the payments due to the bank.

The importer then sends the following documents CHA :-a) Bill of ladingb) Invoice c) Packing list d) Certificate of origine) Pre shipment inspection certificate f) Insurance certificateg) Sales contracth) Bond copy (if H.S.S)

The CHA shows the bill of lading to the shipping agent in order to get the NOC (Non Objection

Certificate in Kandla Port only). No objection certificate has been issued by the shipping line to make sure that they have no

objection to open the containers for the examination of goods. CHA then presents the bill of entry to the customs for noting and then customs gives the import

department the serial no. that comes on all copies of bill of entry. CHA pays wharf age to the port authority and the original copy of wharf age goes to the treasury of

port trust. Customs give the examination order on the back of original bill of entry in case of first check

procedure. Cargo is inspected in front of the customs. Customs give the examination report at the back of the

bill of entry. Customs assessed the duty to ensure that the duty evaluated by the CHA is correct.

Prior to this, the CHA on the basis of invoice, packing list prepares the bill of entry. The bill of entry is a proof that the goods have been imported.

For custom clearance purpose, the importer has to submit to the customs authority a form, which is known as bill of entry.

Bill of entry is in three copies:-

Original copy:-

This is called the customs copy. In first check procedure it contains the examination report on the back of it.

Duplicate copy:-

It is submitted in port either in container section or in break bulk section along with wharf age, NOC, Delivery order. It shows charges have been paid to customs and contain on the back, passed out of custom charges.

Triplicate copy:-

This copy is for central excise for availing certain benefits.

Quadruplicate copy:-

This copy is submitted to the bank.

Port trust copies:-

Out of 5th, 6th, and 7th copies, one copy is given to the port authority. The other two copies are kept by the CHA for his record.

Types of bill of Entry:-

1. Bill of entry for home consumption2. Bill of entry for warehousing3. Bill of entry for Ex-bond clearance for home consumption

Bill of entry for home consumption:-This type of bill of entry is used when importer wants to take the delivery of goods on payment of custom duty.

Bill of entry for warehousing:-This type of bill of entry is used when importer wants to warehousing the goods in custom bonded warehouse.

Bill of for ex-bond clearance for home consumption:-This type of bill of entry is used for clearing the goods from custom bonded warehouse against warehouse bill of entry on the payment of custom duties.

Another important document that is used in import is bill of lading. It plays an important role both for the exporter and importer.

Documents to be used in import:

1. Bill of lading2. Invoice 3. Certificate of origin4. 59- Bond warehousing bond5. Wharf age6. Bill of entry7. Packing list8. NOC (No Objection Certificate)9. Delivery order10. Treasury challan11. Gate pass

Export-Import Documentation

Aligned Documentation System:

Aligned Documentation System (ADS) is based on the UN layout key. Under this system, different forms used in the international trade transaction are printed on paper of the same size and in such way that the common items of information are given the same relative slots in each of the documents.

For the purpose of Aligned Documentation System documents, have been classified as under:

a) Commercial Documents- Commercial documents are required for effecting physical transfer of goods and their title from the exporter to the importer and the realization of export sale proceeds. Out of the 16 commercial documents, in the export documentation framework as many as 14 have been standardized and aligned to one another. These are proforma invoice, commercial invoice, packing list, shipping instructions, intimation of inspection, and certification of inspection of quality control. Insurance declaration, certificate of Insurance, mate’s receipt, bill of lading or combined transport document, application for certificate origin, certificate of origin, shipment advice and letter to the bank for collection or negotiation of documents.

However, shipping order and bill of exchange could not be brought within the fold of the aligned documentation system

b) Regulatory Documents- Regulatory pre-shipment export documents are prescribed by the different government departments ant bodies in order to comply with various rules and regulations under the relevant laws governing export trade such as export inspection, foreign exchange regulation, export trade control. , customs, etc. out of 9 regulatory documents 4 have been standardized and aligned. These are shipping bill or bills of export, exchange control declaration (GR Form), export application, dock challan or port trust copy of shipping bill and receipt for payment of port charges.

Proforma Invoice

The starting point of the export contract is in the form of offer made by the exporter to the foreign customer. The offer made by the exporter is in the form of a proforma invoice. It is a quotation given as a reply to an inquiry. It normally forms the basis of all trade transactions.

Contents of Proforma Invoice

Name and address of the exporter Name and address of the importer Name of country of final destination Marks and container number Name of the port of discharge and final destination Provisional invoice number and date Exporter’s reference number Buyer’s reference number and date Name of the country of origin of goods Number of packing description Description of goods giving details of quantity, rate n total amount in terms of international

accepted price quotations Signature of exporter with date.

Commercial Invoice

Commercial invoice is an important and basic export document. It is also known as a ‘Document of Contents’ as it contains all the information required for the preparation of other documents. It is actually a seller’s bill of merchandise. It is prepared by the exporter after the execution of export order giving details about the goods shipped. It is essential that the invoice is prepared in the name of the buyer or the consignee mentions in the letter of credit. It is prima facie evidence of the contract of sale or purchase and therefore must be prepared strictly in accordance within the contract of sale.

Contents of Commercial Invoice:

Name and address of the consignee Name and address of the exporter Name and number of vessel of flight Name of the port of loading Name of port of discharge n final destination Invoice number n date Exporter’s reference no. Buyer’s reference number and date Name of country of origin of goods Name of the country of final destination Marks and container number. No. n packing description Description of goods giving details of quantity, rate n total amt in terms of internationally

accepted price quotations Signature of exporter with date.

Packing list

The exporter prepares the packing list to facilitate the buyer to check the shipment. It contains a detailed description of goods packed in each case, their gross and net weight, etc. the difference between a packing note and the packing list is that the packing note contains the particulars of contents of an individual pack. While the packing list is a consolidated statement of the contents of a number of casesn or packs.

Mate’s Receipt

Mate’s receipt is a receipt issued by the commanding officer of the ship when the cargo is loaded on the ship. The mate’s receipt is the primer-facie evidence that goods are loaded in the vessel. The mate’s receipt is first handed over to the port trust authority. After making payment of all port dues, the exporter or his agent collects the mate’s receipt from the port trust authorities. The mate receipt is freely transferable. It must be handed over to the shipping company in order to get the bill of lading. Bill of lading is prepared on the basis of mate’s receipt.

Contents of Mate’s Receipt

Name and address of the shipper Name and logo of the shipping line Name and the number of the vessel Name of the port of loading Name of the discharge and place of delivery Marks and container number Packing and container description Total number of container and packages Description of goods in terms of quantity Container status and seal number Gross weight in kg and volume in terms of cubic meters Shipping bill number and date Signature and initials of chief officer

Bill Of Lading

Bill of Lading is a document issued by the shipping company or its agent acknowledging the receipt of

goods 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 chargers as specified in the bill have been duly paid. It is also a document of title to the goods and, as such, is freely transferable by endorsement and delivery.

A bill of lading serves three main purposes: As a document of title to the goods

As a receipt from the shipping company As a contract of transportation of goods.

Contents of bill of lading: Name and logo of shipping line Name and address of the shipper Name and the number of the vessel Name of the port of loading Name of the discharge and place of delivery Marks and container number Packing and container description Total number of container and packages Description of goods in terms of quantity Container status and seal number Gross weight in kg and volume in terms of cubic meters Amount of freight paid or payable Shipping bill number and date Signature and initials of chief officer.

Certificate of Origin

The importers in several countries require a certificate of origin without which clearance to import is refused. The certificate of origin states that the goods exported are originally manufactured in the country whose name is mentioned in the certificate. Certificate of origin is required when;

a) The goods produced in a particular country are subject to preferential tariff rates in the foreign market at the time of importation.

b) The goods produced in a particular country are banned for import in the foreign market.

Contents of Certificate of Origin:

Name and logo of chambers of commerce Name and address of the exporter name and address of the consignee Name and the number of the vessel of flight Name of the port of loading Name of the port of discharge and place of delivery Marks and container number Packing and container description Total number of containers and packages Description of goods in terms of quantity

Signatures and initials of the concerned officer of the issuing authority Seal of the issuing authority

Shipping Bill

Shipping bill is the main custom of document, required by the customs authorities for granting permission for the shipment of goods. The cargo is moved inside the dock area only after the shipping bill is duly stamped, i.e. certified by the custom shipping bill is normally prepared in 5 copies:

Customs copy Drawback copy Export promotion copy Port trust copy Exporter’s copy

Contents of Shipping Bill: Name and address of the exporter Name and address of the importer Name of the vessel, master or agents and flag Name of the port at which the goods are to be discharged Country of final destination Detail of packages, description of goods, marks and numbers, quality and detail of each case. FOD price and real value of goods as defined in the sea customs act. Whether Indian or foreign merchandise to be re-exported Total number of packages with total weight and value.

Consular Invoice

Consular Invoice is a document required mainly by Latin American countries like Kenya, Uganda, Tanzania, Burma, Mauritius, New-Zealand, Myanmar, Iraq, Australia, Fiji, Cyprus, Nigeria, Ghana, Guinea Zanzibar, etc. this Invoice is the most important document, which needs to be submitted for

certification to the embassy of the importing country concern. The main purpose of the consular invoice is to enable the authorities of the importing countries to collect accurate information about the volume, value, quality, grade, source, etc, of the goods imported for the purpose of assessing import duties and also for statistical purposes.

In order to obtain consular invoice, the exporter is required to submit three copies of invoice to the consulate of the importing country concern. The consulate of the importing country certifies them in return for fees. One copy of invoice is given to the exporter while the other two are dispatched to the customs office of the importer’s country for the calculation of import duty. The exporter negotiates a copy of a consular invoice to the importer along with other shipping documents.

Bill of Entry

Bill of Entry is a document, prepared by the importer or his clearing agent in the prescribed form under bill of entry regulations, 1971, on the strength of which clearance of imported goods can be made.

When goods are imported in a particular country, the importer has to pay the necessary import duty. For this purpose, necessary information about the goods imported must be given to the custom authorities in a prescribed form called bill of entry form. Bill of entry is a document, which states that the goods of the stated values and description in the specified quantity have entered into the country from abroad. The bill of entry is drawn in triplicate.

The customs authorities may ask the importer to supply other documents like invoice, broker note and insurance policy, etc. in order to verify the correctness of the information, supplied in the bill of entry form.

For the purpose of giving information in the bill of entry form, goods are classified into three categories namely:

Free goods: where the goods imported are now subject to custom duty

Goods for home consumption: where the goods are imported for self consumption

Bonded goods: where the goods imported are subject to custom duty, the goods are kept in bond till the duty is paid.

The importer has to fill up a separate bill of entry form for different classes of goods. In India, separate forms are not used but all entries are made in one form. The free goods are marked as free in the entry form itself. The importer has to pay the duty before securing the position of the goods.

Contents of Bill of entry:

Name and address of the exporter

Name and address of the importer Import license number of the importer Name of the port/ dock where goods are to be cleared Description of goods Value of goods Rate and amount of import duty payable Other relevant documents

Airway Bill:

Airway Bill, also called as Air Consignment Note, is a receipt issued by an airline for the carriage of goods. As each shipping company has its own bill of lading, so each airline has its own airway bill.

Airway bill or Air Consignment note is not treated as a document of title and is not issued in negotiable form.

Contents of Airway Bill:

Name of the airport of departure and destination The names and addresses of the consigner, consignee and the first carrier Marks and container number Packing and container description Total number of containers and packages Description of goods in terms of quantity Containers’ status and seal number Amount of freight paid or payable Signature and initials of the issuing carrier or his agent

GR Form

GR Form is an exchange controlled document required by the RBI. As per the exchange control regulations, an exporter has to realize the proceeds of the goods he has exported within 180 days of their shipment from India. In order to ensure this, the RBI has introduced the GR procedure.

GR Form is to be submitted in duplicate to the customs at the port of shipment along with the shipping bill. Customs will give their running serial number on both the copies after admitting the custom

shipping bill. Custom authorities will certif. the value declared by the exporter on both the copies of the GR Form and the space earmarked and will also record the assessed value. They will then return the duplicate copy of the form to the exporter and retain the original transmission to the RBI. Within 21 days from the shipment of goods, exporter must lodge the duplicate copy of GR Form together with relative shipping documents with the authorized dealer named in the GR form for negotiations of export bills.

After the documents have been negotiated, the authorized dealer will report the transaction to the RBI. The duplicate copy of GR Form together with the copy of invoice will be retained by the authorized dealer till full export proceeds have been realized and thereafter, submitted to the RBI.

I. On the account of introduction of electronic data interchange system at certain custom offices where shipping bills are processed electronically, the existing declaration in GR Form has been replaced by a declaration in form SDF (Statuary Declaration Form

Document Performa

Exporter No. _____________________

Chamber of Commerce & IndustryRecognized by Ministry of Commerce & IndustryGovt. of India

Federation of Indian Micro and Small& Medium EnterprisesB-4/161, Safdarjung Enclave, New Delhi – 110029Tel. : 26187948, 26712064 , 46023157 , 46018592Fax : (+91-11-)26109470 E-mail : chamber@fisme.org.in E-mail : info@fisme.org.inWeb address : http://www.fisme.org.in

Consignee

Pre-Carriage by Place of Receipt by Pre-Carrier

Vessel / Flight No. Port of Loading

Port of Discharge Final Destination

Marks & Nos./ No. & Kind of Pkgs. Description of GoodsContainer No.

Invoice No.Invoice Date.IEC-Code No:

Quantity Value

It is hereby certified that goodsAre of Indian Origin

Signature of Exporter

CERTIFICATE OF ORIGIN (Non Preferential)

GR FORM:

Data Analysis And Representation

Are you doing Import Export activity?

Exim unit Non Exim unit

55% 45%

55%

45%Exim Non Exim

Pie chart showing that 55% company are dealing Export , Import activities and 45% are not dealing .

Which type of cargo do you deal in?

Normal Perishable Hazardous

60% 12% 28%

60%

12%

28%

NormalPerishableHazardous

Basicaly chemical industries produces hazardous goods and dooing exim that are 28%.

Normal goods are 60%

Perishable goods are 12%

Using FCL or LCL cargo. ?

FCL LCL

60% 40%

60%

40%

FCLLCL

60% companies are use FCL (Full Container Load ) these are the large scale companies and seal the containner in company premises.

Remaining 40% are mainly SSI unit these are seal in port.

Over all requirments of Exports .

Current requirment

Future requirment

Not requirment Own forwarder

55% 12% 15% 18%

0%

10%

20%

30%

40%

50%

60%

55%

12% 15% 18%

Series1

NO of companies

Current requirment of companies 55% Future requirment is 12% Not requirment is 15% Own Forwarder 18%.

Sugge s tions

From the Internship I found some new techniques that are applicable for better Improvements.

1. Company should establish back office for internal support.2. Company should start some sales promotional activity for better attraction in customer’s

memory.3. Company should focus on the transportation services.4. Company should focus on B & C type customers for better profit.5. Company should increase marketing executive team.6. To concentrate on advertisement.7. Above can be done by expanding its expertise network, also by improving quality of services

at a competitive price.8. Also impact should make effort to make aware to customers about new trends in 3pl /4pl also

telling them benefit of outsourcing.9. .Last but not least impact should focus on slowly to big customers so that it can expand the size

of business and can create Brand name in market for itself

Conclusions:

In a layman’s term export is what goes out and Import is what comes in but the actual procedure is not so simple as it sounds. There is terms and liabilities to each export and importer which they have to fulfill to successfully carry out the import export procedure. The documentation of import and export is the most complex part. It starts from agreeing on terms and condition for export and import then dispatching and receiving and clearing of goods and services. It is time consuming and requires expertise and precision. A very minute mistake may cause a great amount of loss/damage to the importer/exporter.

For me import and export is not only transaction of goods and services it is also the transaction of culture, lifestyle because when we consume goods and use a foreign technology it does changes our lifestyle and make an influence on our culture.

Bibilography

Book references

1) International Trade and Export Management

By Francis Cherunilam

2) Export Import Procedures and Documentation

Dr.khushpat S.Jain

Internet websites

www.transformerindia.com

www.export911.com

www.cbec.gov.in

Questionnaire

This questionnaire highlights characteristics common to successful exporters. Many of these questions will guide you into areas of our homepage where you can obtain more information on exporting. You will receive a score once you complete the questionnaire, which will help you to assess your export readiness, as well as an identification of areas your business needs to strengthen to improve its export activities.

1. Does your company have a product or service that has been successfully sold in the domestic market?

Yes No

2. Does your company have or is your company preparing an international marketing plan with defined goals and strategies?

Yes No

3. Does your company have sufficient production capacity that can be committed to the export market?

Yes No

4. Does your company have the financial resources to actively support the marketing of your products in the targeted overseas markets?

Yes No

5. Is your company’s management committed to developing export markets and willing and able to dedicate staff, time and resources to the process?

Yes No

6. Is your company committed to providing the same level of service given to your domestic customers?

Yes No

7. Does your company have adequate knowledge in modifying product packaging and ingredients to meet foreign import regulations and cultural preferences?

Yes No

8. Does your company have adequate knowledge in shipping its product overseas, such as identifying and selecting international freight forwarders and freight costing?

Yes No

9. Does your company have adequate knowledge of export payment mechanisms, such as developing and negotiating letters of credit?

Yes No