Sections 13 and 22-24 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.
Imported goods can be pilfered, damaged, lost or destroyed before they are cleared. These four sections say what happens to the duty in each case, how it is reduced for damage, when an owner may walk away from the goods by relinquishing title, and how goods that serve more than one purpose may be denatured.
This article follows the text on the CBIC portal updated to 30 March 2022 (the Act as amended up to the Finance Act, 2022). Please check any later Finance Act changes to these sections before acting.
The importer is not liable to duty on imported goods pilfered after unloading and before the clearance order, unless the goods are restored to him. For damaged or deteriorated goods, duty is charged in the proportion of the damaged value to the value before damage. Duty is remitted on goods lost (otherwise than by pilferage) or destroyed before clearance, and the owner may relinquish title before the clearance or warehouse order, except where an offence appears to have been committed.
Section 13: pilfered goods
If any imported goods are pilfered after the unloading thereof and before the proper officer has made an order for clearance for home consumption or deposit in a warehouse, the importer shall not be liable to pay the duty leviable on such goods, except where such goods are restored to the importer after pilferage.
The window is specific: after unloading, and before the order for clearance for home consumption or deposit in a warehouse. The relief covers goods that have been pilfered, and it ends where the goods are restored to the importer. If you are facing a loss of this kind, a legal consultation can help you assess how these sections apply to the facts and what to put on record.
Section 22: abatement of duty on damaged or deteriorated goods
Sub-section (1). Where it is shown to the satisfaction of the Assistant Commissioner of Customs or Deputy Commissioner of Customs that:
- (a) imported goods had been damaged or had deteriorated at any time before or during the unloading of the goods in India; or
- (b) imported goods, other than warehoused goods, had been damaged at any time after unloading in India but before their examination under section 17, on account of any accident not due to any wilful act, negligence or default of the importer, his employee or agent; or
- (c) warehoused goods had been damaged at any time before clearance for home consumption on account of any accident not due to any wilful act, negligence or default of the owner, his employee or agent,
such goods shall be chargeable to duty in accordance with sub-section (2).
Clause (a) has no "accident" or "fault" condition: damage or deterioration before or during unloading qualifies. Clauses (b) and (c) apply after unloading and need an accident not due to wilful act, negligence or default. Clause (b) is for goods other than warehoused goods; clause (c) is for warehoused goods. For warehousing generally, see our post on customs bonded warehousing.
Sub-section (2): the formula. The duty to be charged on the goods referred to in sub-section (1) shall bear the same proportion to the duty chargeable on the goods before the damage or deterioration which the value of the damaged or deteriorated goods bears to the value of the goods before the damage or deterioration.
In symbols: duty charged = duty chargeable before damage x (value after damage / value before damage). The Act gives no figures; the numbers in the example below are invented.
Sub-section (3): how value is found. The value of damaged or deteriorated goods may be ascertained by either of the following methods, at the option of the owner: (a) the value may be ascertained by the proper officer, or (b) the goods may be sold by the proper officer by public auction or by tender, or with the consent of the owner in any other manner, and the gross sale proceeds are deemed to be the value.
The choice is the owner's. The footnote records that the words "Assistant Commissioner of Customs or Deputy Commissioner of Customs" were substituted with effect from 11 May 1999 by section 100 of the Finance Act, 1999 (27 of 1999).
Section 23: remission and relinquishment
Sub-section (1). Without prejudice to section 13, where it is shown to the satisfaction of the Assistant Commissioner of Customs or Deputy Commissioner of Customs that any imported goods have been lost (otherwise than as a result of pilferage) or destroyed, at any time before clearance for home consumption, that officer shall remit the duty on such goods.
Note the word "shall": once the officer is satisfied, remission is not optional. The words "(otherwise than as a result of pilferage)" mean that loss by pilferage is handled by section 13 and not here; the footnote shows these words and the opening words "Without prejudice to the provisions of section 13" were put in by Act 11 of 1983 (section 48), with effect from 13 May 1983.
Sub-section (2): relinquishing title. The owner of any imported goods may, at any time before an order for clearance of goods for home consumption under section 47 or an order permitting the deposit of goods in a warehouse under section 60 has been made, relinquish his title to the goods, and thereupon he shall not be liable to pay the duty thereon.
The proviso. The owner of any such imported goods shall not be allowed to relinquish his title to goods regarding which an offence appears to have been committed under the Act or any other law for the time being in force. The footnote shows the proviso was inserted by Act 21 of 2006 (section 58) with effect from 18 April 2006. So an owner cannot use relinquishment to escape the consequences where an offence appears.
Relinquishment has a time limit that is not a number of days but an event: it must happen before the clearance order or the warehouse deposit order. After that point, the sub-section no longer helps.
Section 24: denaturing or mutilation
The Central Government may make rules for permitting, at the request of the owner, the denaturing or mutilation of imported goods which are ordinarily used for more than one purpose, so as to render them unfit for one or more of such purposes. Where any goods are so denatured or mutilated, they shall be chargeable to duty at such rate as would be applicable if the goods had been imported in the denatured or mutilated form.
The copy prints this section with some words run together ("ofthe", "ordinarilyused", "bechargeable"); they are printing slips and the meaning is as given above. The Denaturing of Spirit Rules, 1972 state that they are made under sections 24 and 158 and cover imported spirit and spirit contents of imported spirituous preparations denatured at the importer's request; the copy consulted is dated 6 August 2014. The rule-wise detail is not set out here.
The four sections side by side
| Section | Event | Effect on duty |
|---|---|---|
| 13 | Pilfered after unloading, before clearance or warehouse order | Importer not liable, unless goods are restored to him |
| 22 | Damaged or deteriorated (within clauses (a) to (c)) | Duty in the proportion of damaged value to value before damage |
| 23(1) | Lost (not by pilferage) or destroyed before clearance | Duty remitted |
| 23(2) | Owner relinquishes title before clearance or warehouse order | Not liable to duty; not allowed where an offence appears |
| 24 | Denaturing or mutilation under rules at the owner's request | Duty at the rate applicable to the denatured or mutilated form |
A worked example with invented names
Lotus Beverages Pvt. Ltd. imports a consignment of bottled juice. During unloading some cartons are crushed. Lotus shows to the Deputy Commissioner that the goods were damaged before or during unloading, so section 22(1)(a) applies. Suppose, for illustration, the value of the damaged lot is half its value before damage. Under sub-section (2), the duty charged would be half of the duty chargeable before the damage. Lotus chooses the owner's option in sub-section (3)(b): the proper officer sells the damaged lot at public auction and the gross sale proceeds are deemed to be its value. For the charge of duty in the first place, see our article on section 12; for exemptions by notification, see section 25.
Need help with loss or damage to imported cargo?
If goods are damaged, lost or pilfered before clearance, the facts you record at the time decide which section applies. Our legal consultation service can help you choose the route and prepare your representation.
Key takeaways
- Section 13 relieves the importer of duty on pilfered goods, unless they are restored to him.
- Section 22 reduces duty on damaged or deteriorated goods in the ratio of damaged value to value before damage; the owner chooses how value is found.
- Section 23(1) requires remission of duty on goods lost (not by pilferage) or destroyed before clearance.
- Section 23(2) lets the owner relinquish title before the clearance or warehouse order, but not where an offence appears to have been committed.
- Section 24 allows denaturing or mutilation under rules, with duty at the rate for the changed form.
Read next
- Section 12: dutiable goods and the charge of customs duty
- Sections 19–21: sets of articles, re-importation and derelict or wrecked goods
- Section 25: power to grant exemption from duty
- Customs Bonded Warehouse: Section 57-73
Disclaimer: Based on the Customs Act, 1962 as published on the CBIC Tax Information Portal, updated to 30 March 2022 (amended up to the Finance Act, 2022), as consulted on 2 October 2026. Finance Acts of 2023 and later, and the current rules, regulations and notifications, should be checked. This article is general information, not legal advice; check the official text before acting.