If imported goods are pilfered (stolen)

any time after their loading

but before proper officer has made order for clearance for home consumption or warehousing

then th e im p o rte r sha l l n o t b e l ia b l e t o p a y t h e d ut y le v i a b l e o n s u c h g o o d s


Ho w e v e r , w he r e su c h good s a r e res t o re d (recovered) t o th e i m po r t e r a f te r p il f e r a g e , t h e i mpo r t e r becomes liable to duty.


Conditions to be satisfied

  • Goods must be pilfered (damage or deteriorated goods not covered)
  • Pilferage should be between their unloading and order for clearance

(Pilferage of goods cleared after order for clearance but before actual clearance not covered)(Also pilferage before unloading not covered)

  • Pilfered goods should not be restored back (if restored then duty payable)


Exam Questions

Question 15
Answer the following questions:-
(i) ABC Manufacturers Ltd. imported some goods from Japan through a vessel. After the
ship entered Indian port, the goods were unloaded and were lying with the custodian.
The said goods were pilfered before the proper officer made an order for clearance for
home consumption. Is ABC Manufacturers Ltd. liable to pay duty on such goods?
Further, what would be the customs duty implication if such goods are restored to ABC
Manufactures Ltd.
(ii) Amino Industries imported certain goods from Norway. The said goods were
warehoused in a public warehouse for a period of 3 months after which it is cleared for
home consumption on payment of applicable customs duty. While transporting the goods
from customs warehouse to the factory of the importer, the said goods were damaged.
Can duty paid on such goods be remitted to Amino Industries?

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CA Maninder Singh

CA Maninder Singh is a Chartered Accountant for the past 14 years. He also provides Accounts Tax GST Training in Delhi, Kerala and online.