HCCAR 2009 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Regulations 9 to 13 of the Handling of Cargo in Customs Areas Regulations, 2009 (HCCAR 2009) cover the life cycle of a custodian's approval: the application in Form A, approval for two years, review and extension, the 2024 rule that an AEO custodian's approval runs with its AEO authorisation, suspension and revocation with a full hearing procedure, a penalty up to fifty thousand rupees, an appeal, and renewal for five years.
The Commissioner must dispose of an application within forty five days. Approval is for two years (five years for providers already approved when the regulations began), reviewed before expiry and extendable by five years at a time. After Notification No. 75/2024, the approval of a provider authorised under the Authorised Economic Operator Programme remains valid as long as the AEO authorisation is valid and not suspended or revoked under regulation 12. A contravention can draw a penalty up to fifty thousand rupees.
Position of the text: as amended up to Notification No. 75/2024-Customs (N.T.) dated 7 November 2024, which substituted the second proviso to regulation 10(2). Later notifications should be checked; no official consolidated text exists.
The conditions to be met before approval are in our articles on regulations 1 to 5 and regulations 6 to 8. For the AEO programme itself, see our overview of AEO certification and its tiers. A custodian facing a show-cause notice on suspension or revocation can take advice from our legal dispute resolution team.
Regulation 9: application for approval
Regulation 9(1): an application to act as a Customs Cargo Service provider for custody and handling of imported or export goods in a customs area is made as a letter to the jurisdictional Commissioner of Customs containing the details prescribed in Form A. Regulation 9(2): the Principal Commissioner or Commissioner disposes of the application within forty five days of receipt. The text does not say what follows if the period lapses.
Regulation 10: approval and review
| Sub-regulation | Rule |
|---|---|
| 10(1) | Where the Commissioner is satisfied that the applicant has fulfilled the conditions in regulation 5, he may approve the applicant as a Customs Cargo Service provider for a period of two years from the date of issue of the approval |
| Proviso to 10(1) | A provider already approved on or before the date the regulations came into force is deemed approved for five years from the date of compliance with the conditions stipulated in regulation 4 |
| 10(2) | The Commissioner reviews the approval before the expiry of the initial two or five years, as the case may be, and may extend it for a further period of five years at a time |
| First proviso to 10(2) | For reasons recorded in writing, the Commissioner may order a review of the approval of any provider before the period of approval is completed |
| Second proviso to 10(2) (as substituted by 75/2024) | For a provider authorised under the Authorised Economic Operator Programme, the approval under 10(1) is deemed extended and remains valid as long as the AEO authorisation is valid and not suspended or revoked in terms of regulation 12 |
What changed for AEO custodians
Before 7 November 2024 the second proviso said that, for a provider authorised under the AEO Programme, the approval under sub-regulation (1) could be extended for a further period of ten years at a time. Notification No. 75/2024 replaced that with a deemed extension tied to the AEO authorisation. The AEO custodian therefore does not need a periodic extension order; its approval stays valid while the AEO authorisation does. If the AEO authorisation is suspended or revoked, the approval does not run on.
Regulation 11: suspension or revocation
Regulation 11(1): the Commissioner may, subject to the regulations, suspend or revoke the approval, after observing the procedure in regulation 12, and may also order forfeiture of security, if any, for failure to comply with any provision of the Act or the rules, regulations, notifications and orders under it.
Regulation 11(2): despite sub-regulation (1), the Commissioner may, in appropriate cases where immediate action is necessary, suspend the approval where an enquiry against the provider is pending or contemplated. This is the urgent power; the regulation does not itself require the notice and hearing steps before such a suspension.
Regulation 12: procedure and penalty
| Sub-regulation | What it provides |
|---|---|
| 12(1) | The Commissioner issues a written notice stating the grounds on which suspension or revocation is proposed, requiring a written statement of defence within the time specified, not less than thirty days, to the Assistant or Deputy Commissioner nominated by him, and asking whether the provider wants a personal hearing |
| 12(2) | On receipt of the statement, or if none comes in time, the nominated officer may inquire into the grounds not admitted by the provider |
| 12(3) | In the inquiry he considers documentary evidence and takes oral evidence relevant or material to the grounds, and may question any person tendering evidence |
| 12(4) | The provider may cross-examine persons examined in support of the grounds; if the officer declines to examine any person as not relevant or material, he records reasons in writing |
| 12(5) | At the end of the inquiry he prepares a report recording his findings |
| 12(6) | The Commissioner furnishes a copy of the report and requires any representation within a specified period of not less than thirty days |
| 12(7) | After considering the report and any representation, the Commissioner passes such orders as he deems fit |
| 12(8) | A provider who contravenes any provision, abets the contravention, or fails to comply with a provision it was his duty to comply with, is liable to a penalty which may extend to fifty thousand rupees |
| 12(9) | A provider aggrieved by any decision or order under the regulation may appeal under section 129A of the Act to the Customs, Excise and Service Tax Appellate Tribunal established under section 129(1) |
Note that the penalty in regulation 12(8) applies to abetment and to failure to comply, and sits within the procedure regulation. The text states a ceiling of fifty thousand rupees and no floor.
Regulation 13: renewal
The Commissioner may, on an application made by the provider before the expiry of the validity of the appointment under regulation 10, renew the approval for a further period of five years from the date of expiration of the original approval or of the last renewal, if the provider's performance is found satisfactory with reference to its obligations under the Act and the rules, regulations, notifications and orders under it. The key condition is timing: the application goes in before the validity expires.
A worked example
Metro Gateway CFS received a two-year approval on 1 April 2024. Because it is not AEO-authorised, it must apply for renewal before 31 March 2026 and satisfy the Commissioner that its performance is satisfactory; renewal runs for a further five years from the date of expiration. A sister facility, Harbour Point Terminals, holds AEO authorisation. Its custodian approval is deemed extended and stays valid as long as the AEO authorisation is valid and has not been suspended or revoked. If Customs proposed to suspend Harbour Point's approval for a contravention, it would first receive a notice with at least thirty days to reply, a possible inquiry with cross-examination, a copy of the report and a further thirty days to respond.
Practical points
- Diary the approval expiry and file the renewal application before it; regulation 13 requires an application before expiry.
- AEO custodians should track the AEO authorisation's validity, since the approval follows it.
- Penalty up to fifty thousand rupees may follow contravention or abetment, and an appeal lies under section 129A.
Need help with a custodian approval, suspension or renewal?
If a custodian has received a notice proposing suspension or revocation, or needs to renew its approval, our legal dispute resolution team can prepare the defence statement and the representation within the periods in regulation 12.
Key takeaways
- Application is by letter in Form A; the Commissioner disposes of it within forty five days.
- Approval runs for two years, or five years for providers approved before the regulations began, and is reviewed and extended by five years at a time.
- AEO custodians: approval remains valid while the AEO authorisation is valid and not suspended or revoked (Notification No. 75/2024).
- Suspension or revocation follows a notice, a defence period of not less than thirty days, an inquiry and a second thirty-day window; urgent suspension is allowed in regulation 11(2).
- A penalty up to fifty thousand rupees and an appeal under section 129A are provided.
- Renewal is for five years on an application made before expiry.
Read next
- Regulations 1-5 of the Handling of Cargo in Customs Areas Regulations, 2009: application and custodian conditions
- Regulations 6-8 of the Handling of Cargo in Customs Areas Regulations, 2009: responsibilities, relaxation and commencement
- AEO certification: Authorised Economic Operator tiers
Disclaimer: Based on the customs regulations named above as published on the CBIC Tax Information Portal or in the Gazette and, for sets amended since 2023, the amending notifications (read through a TaxClue consolidated reading text; no official consolidated text exists), as consulted on 3 October 2026. Later notifications, fees and the Customs Act, 1962 provisions referred to should be checked. This article is general information, not legal advice; check the official text before acting.