Procedure of transshipment of goods en route final destination: 

The transshipment of goods from one vehicle to other vehicle(s) en route the destination(s) can be of two categories:-

(a) Where the entire quantity is transhipped from one vehicle to another vehicle, which may be on account of—

(i) Breakdowns;

(ii) Non-availability of inter-state transport permit.

(b) Where the consignment originally cleared on an invoice issued under Rule 11, is required to be split up en route for transport by different vehicles on account of –

i. breakdown of the original vehicle and non-availability of the substitute vehicle of the appropriate capacity, or

ii. requirement of splitting up of the consignment and loading in vehicle other than the vehicle on which goods were cleared from the factory, or

iii. part consignment/package(s) misplaced during transhipment, but recovered later on.

Regarding category (a) and (b), the owner of goods or his agent or the person in charge of the vehicle, at the material time, acting as his agent, shall make a suitable endorsement at the back of the transport‘s copy of the invoice accompanying the consignment indicating the date and time of breakdown of the vehicle and the registration number of the new vehicle in which the consignment is re-loaded.

In cases of splitting up and transhipment on account of any other reason, including predetermined distribution of goods from an intermediate point, the assessee should be prepared separate invoice for each lot. At the intermediate point, the owner of goods or his agent or the person in charge of the original vehicle shall endorse the registration number of the new vehicle. Upon receipt of goods in the factory, the assessee shall confirm by endorsing on the invoice that the goods were received in the factory in the specified vehicle.

Note: Under customs law where there is an import of goods, duty at the rate of 4% is payable under Section 3(5) of the Customs Tariff Act. This is called as additional duty in lieu of VAT. The Government has issued a Notification No.102/2007 dated 14.9.2007 as per which a person that pays this duty can seek a refund provided he produces proof that he has sold the goods and VAT/sales tax has been paid. One of the conditions is that the invoice must show that the buyer cannot avail cenvat credit of 4% duty.