Instances of change of ownership is frequent requirement in Custom Bonded Warehouses. Post 01.02.2019, IGST on the supply from bonded Warehouse to another Bonded Warehouse goods or within a bonded warehouse has been done away with. Amendment 2018 in Schedule III of of CGST Act 2017 mandated treating these flows of goods not as supply. Although, unnecessary tax burden on the traders has been off shouldered a good deal of compliance on the part of importer remains in place.
Documentation Requirement in Change of Ownership
Following requirement is practiced in NCH, Mumbai in the instances of Change of Ownership in Customs Bonded Warehouse.
- Fresh Triple duty Bond from the buyer
- Annexure -3 in triplicate- Application for transfer u/s 59(3) from seller to buyer
- Intimation of the sale transaction to DC/Bond from Seller
- Intimation of the Purchase transaction to DC/Bond from Buyer
- Letter of authorization for CHA (submitted by buyer) for dealing with entire process of transaction
- Sale agreement (notarized) showing actual terms & condition and the transaction value
- B/L Copy signed by both copy
- Check list for ex-bond (although, in case of same warehouse, the movement of goods doesn’t happen)
- Warehouse B/E
- Identity details of the authorized signatory of Importer (if Importer himself is not signing on the bond)
- Copy of IEC
- Identity proof of witnesses who have put on their signature over the bond
Why Change of Ownership [COO] is Necessitated?
It is very simple! The entire bulk liquid imported by an importer may not be consumed by the importer himself. At the same time, there could other importers who might require the liquid bulk [or any goods for that matter] on an urgent basis for his consumption or to fulfill an obligation with other customer who is need of such goods and cannot wait for a fresh import as it could be a time consuming affair for the most part.
This is where the already imported cargo/goods in excess of one’s consuming capability comes as saviour. The original importer [seller] and subsequent importer [buyer] by complying with certain conditions may opt for Change of Ownership [COO].
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