Reimbursement of Custome Duty/CHA and other import charges

[KOHINOOR MITRA]

Sir,

My query is as below :

H Co a Hong Kong based company received a global order from S International Bank for supply of machines to different branches of the bank spread across different countries.

H Co wants B Co, an Indian Public limited company to act as H Co's agent  in India to carry out all the import facility for them like

1. payment of custom duty utilising the IEC code of B Co, ( which later will be reimbursed by H Co), here it is expected that the BOE will be in the name of the S international bank India.

2. Get the imported materials cleared through customs in India and send the same to S International Bank in India . The presumption is that as per H's order on B Co., H co will again reimburse all the expenses done in this respect by B Co., additionally H co may also pay a commission for this service done by B Co.

3. Please note that there is no evidence of any locus standi between S bank and B Co.

Kindly advise whether the above transaction is possible and what are the precautions to take if any?

Regards

Kohinoor  Mitra

AI Summary

Importer of record restrictions may bar using an agent's IEC to clear imports; use agency work orders instead.
Use of an intermediary to effect imports for a third party purchaser is constrained by customs rules that fix the importer of record shown in the IGM and the Bill of Entry, and by FEMA considerations for foreign reimbursements. An intermediary cannot lawfully substitute its IEC to create a Bill of Entry in another party's name without addressing these formalities. If an agent will pay duties and obtain reimbursement, a clearly drafted agency or work order linking the agent to the principal's order and specifying payment and reimbursement terms is essential, and parties must ensure customs filings and cross border remittances comply with law.