The Central Board of Indirect Taxes and Customs (CBIC) has issued an important clarification aimed at improving operational efficiency at Indian ports by standardising the procedures relating to Entry Inward and Vessel Sail-out Clearance.

The circular addresses long-standing concerns regarding delays caused by mandatory physical boarding of Customs officers before granting operational clearances to vessels. Through this clarification, CBIC has reinforced that physical boarding and grant of Entry Inward or Sail-out Clearance are two separate statutory processes under the Customs Act, 1962.

For shipping lines, importers, exporters, customs brokers, and logistics operators, this move is expected to reduce vessel turnaround time and improve cargo movement efficiency across ports.

Background of the Clarification

CBIC observed that several ports were following inconsistent practices while granting Entry Inward and Sail-out Clearance. In many instances, Customs authorities were allowing vessels to commence cargo operations only after physical boarding formalities were completed.

Similarly, vessel departure permissions were also being delayed pending boarding-related procedures.

These operational practices were resulting in avoidable delays in berthing, unloading, loading, and vessel departure, directly impacting supply chain timelines and port efficiency.

To address these concerns, CBIC has now clarified the legal position under the Customs Act, 1962.

Legal Position Clarified by CBIC

The circular reiterates that the provisions governing Entry Inward are covered under Sections 30 and 31 of the Customs Act, 1962, while Vessel Sail-out Clearance is governed under Sections 41 and 42 of the Customs Act, 1962.

At the same time, physical boarding of vessels by Customs officers is an independent statutory process governed under Section 37 of the Customs Act, 1962 and the Imported Stores (Retention on Board) Regulations, 1963.

CBIC has specifically clarified that grant of Entry Inward and Sail-out Clearance should not be made dependent upon physical boarding of Customs officers on the vessel.

This distinction is significant because it separates operational clearances from inspection-related procedures and enables ports to process vessels more efficiently through digital documentation and risk-based controls.

Digital Compliance through SCMTR

The circular also highlights the implementation of Sea Arrival Manifest (SAM) and Sea Departure Manifest (SDM) under the Sea Cargo Manifest and Transhipment Regulations (SCMTR).

Shipping lines and shipping agents are now required to file these declarations electronically. The system also allows uploading of crew details, ship stores, and other supporting documents through e-Sanchit using IRN-based referencing.

By enabling online filing and remote verification, Customs officers can now process Entry Inward and Sail-out Clearances without requiring physical boarding in every case.

This is another step toward digitisation and faceless Customs processing aimed at reducing procedural bottlenecks in maritime trade operations.

Risk-Based Boarding Approach Introduced

CBIC has instructed field formations to adopt a risk-based mechanism for physical boarding of vessels instead of routine boarding practices.

The risk assessment may consider factors such as compliance history of the vessel, voyage pattern, itinerary, nature of cargo, safety concerns, and security parameters.

This approach aligns with modern trade facilitation principles where compliant operators benefit from faster clearances, while enforcement resources are focused on high-risk consignments and vessels.

Impact on Importers, Exporters, and Shipping Stakeholders

The clarification is expected to bring considerable operational relief to the shipping and logistics industry.

Faster grant of Entry Inward will help reduce delays in commencement of cargo operations after berthing. Similarly, quicker Sail-out Clearance can help minimise vessel detention and improve fleet utilisation.

For importers and exporters, reduced vessel delays may contribute to better inventory planning, lower demurrage exposure, and smoother supply chain management.

Shipping agents and Customs brokers will also benefit from greater procedural clarity and standardisation across ports.

Most importantly, the circular strengthens the government’s ongoing efforts toward ease of doing business, paperless trade processing, and efficient port logistics management.

Preface Consulting Perspective

From a compliance and trade facilitation standpoint, this clarification is a progressive step toward harmonising Customs procedures across Indian ports.

Businesses involved in international trade should ensure proper and timely filing of SAM and SDM declarations under SCMTR to avoid operational disruptions. Shipping stakeholders should also strengthen digital documentation practices and compliance systems, as Customs authorities are increasingly shifting toward risk-based and technology-driven monitoring frameworks.

The move reflects CBIC’s continued focus on balancing trade facilitation with regulatory oversight through intelligent risk management mechanisms.