Report for Internship

Aimm Freight Forwarders (P) Ltd., Company

Introduction:

Logistics refers to the overall process of managing how resources are

acquired, stored, and transported to their final destination. Logistics
management involves identifying prospective distributors and suppliers and
determining their effectiveness and accessibility. Logistics managers are
referred to as logisticians.

"Logistics" was initially a military-based term used in reference to how

military personnel obtained, stored, and moved equipment and supplies.
Logistics is an element of the overall supply chain. Logistics refers to the
movement of goods from Point A to Point B, which entails two functions:
transportation and warehousing.

Logistics refers to what happens within one company, including the

purchase and delivery of raw materials, packaging, shipment, and transportation
of goods to distributors, for example. While supply chain management refers to
a larger network of outside organizations that work together to deliver products
to customers, including vendors, transportation providers, call centers,
warehouse providers, and others.

The resources managed in logistics can include physical items such as

food, materials, animals, equipment, and liquids, as well as abstract items, such
as time and information. The logistics of physical items usually involves the
integration of information flow, material handling, production, packaging,
inventory, transportation, and warehousing.
History of Logistics:

Logistics management originated by the British Army far before the

outbreak of the First World War where a military supply chain system was
developed by building infrastructure such as; roads, railroads, ports, airfields,
supply stores and vehicles to transport weapons and troops. In the United
States, which started its agricultural produce distribution across the continent in
the late 19th Century, there was a development of industrial goods distribution
system. This eventually led to the start of the official Logistics Management
Science in the US in 1964.

The term logistics is attested in English from 1846, and is from French:
logistique, where it was either coined or popularized by military officer and
writer Antoine-Henri Jomini, who defined it in his Summary of the Art of
War. The map below shows the main trade routes between China and Europe.
They were called the Silk Road although other products were also moved such
as spices and food products. 

Considering ‘logistics’ authoritatively incepted during World War 1

(1914-1918), military logistics was the first to come into the picture.
‘Logistikas’ were supervising the movement and storage of resources before
World War but post-war, the term became widespread as ‘Logistics Officers’
replaced ‘Logistikas’.
Military logistics was primarily concerned with the movement of
ammunition and relevant war equipment to the places they were required. It
dealt with numerous variables ranging from prediction of total cost,
consumption of materials, and the likely requirements in the future.
About the company:

Aimm Freight Forwarders (P) Ltd., Company is a Shipping based

company which used to export and import all over the country. Their main forte
is to be a single window operator for all movement of logistics both inbound
and outbound. They also make all freight forwarding services available like
customs clearance, warehousing, etc.

The company is controlled by two Managing Directors namely,

 Bala Subramanian
 Sekar

At the beginning the company was started as a Partnership company with

4 members and 2 employees at the year 2006. Then after few years at 2010 the
Company was transferred to Private limited company with Two managing
directors and at present 13 employees are working at different departments. In
year of beginning the company the company was named as the Aimm Logistics
and then changed to Aimm Freight Forwarders (P) Ltd., Company. The
company also has another branch and it is only delivering the international
couriers.

The company also has its branches at different cities and it is controlled
by directors under the contact bases and the location are:

Chennai
Cochin
Bangalore
Tuticorin
Mumbai
 The company also rented warehouse for storing the goods that has to be
exported and imported at the main cities like:

Tuticorin
Chennai
Cochin
Bangalore
Organisation Structure:

Managing Director

Sales Manager

Customer Service

Accounts Manager

Marketting Head

Sales Executive

Operations Director

Documentation Executive
Departmentation:

Export

Courier Departments Import

Accounts
Export Department:

At this Department there are two employees who will take care of all the
procedures and documentation work that has to be cleared and done that
belongs to the export. They used to prepare or collect the main documents like
commercial bills, packing list and Bill of lading that are needed to complete the
export procedures.

The export department is further divided into two categories. They are:

 Seaway Export
 Airway Export

Import Department:

At this department there are two employees who will take care of all the
procedures and the documents have to be done clearly mentioned and arranged
while comparing to the export. After the documentation work is done, the
details will be mailed to the importer to get the goods. Some of the main
documents that have to be collected are Bill of lading, Certificate of origin and
Tax duty invoice.

The import department is further divided into two categories. They are:

 Seaway Import
 Airway Import

Import procedures will be different while comparing to seaways and airways.

Accounts Department:

At this department all the billing work will be done after the
documentation work is done and then the tally work will be done.
Courier Department:

At this department the shipper or the company has to update about the
movement of goods will be updated to the exporter, while it comes to the
importer the movement goods must be updated by the shipping company.

Process of Export:

Confirmation of order Procurement of goods Quality control

Labelling, Packaging,
Finance Insurance
Packing and Marking

Customs House
Delivery Customs Procedure Agents

Realization of Export Submission of

Documentation
proceeds documents to bank
List of Products/ Services:

The main products that are exported or imported by the company are:

Fabrics
Machineries
Dying Chemicals
Embroidery materials

Even Roll on and Roll off service is done by them. It means loading the
wheeled goods like car and trucks in the vessels.

Fabrics:

Fabric is cloth or other material produced by weaving together

cotton, nylon, wool, silk, or other threads. Fabrics are used for making things
such as clothes, curtains, and sheets.

Machineries:

 Fabrics inspection machine.

 Cutting machine.
 Fusing machine.
 Embroidery machine.
 Sewing machine.
These are some machines that are exported or imported by the company that
belongs to garment.

Embroidery Materials:

Embroidery is a part of Fabrics; special woven fabrics, tufted textile

fabrics, lace, tapestries, trimmings, embroidery. They include Embroidery of
manmade fibres, Embroidery of cotton, Embroidery of natural textile fibres
except cotton, and Embroidery without visible ground.

Dying Chemicals:

 Soda ash,
 Hydrochloric,
 Hydrogen peroxide,
 Sulphuric Acid,
 Acetic Acid,
 Formic acid,
 Caustic soda.

 Learning outcome:

At the company they thought me about the procedures and the main
documents that has to be prepared for the both import and export. First, they
thought what are all the main documents that are basically needed for the
exporter. They are PAN card number, USD bank account, Current account in
our regional bank and IE code.

Then they also explained what are all the main documents that are
needed for the export like Commercial invoice, Packing list, Customs clearance
document and Bill of lading.

The main and major difference between the export and import has been
teached.

At commercial invoice some of the major information’s like Nature of

payment, purchase order of the both customer and receiver it will be mentioned
as:

CA PO#
Customer PO#
 CA PO# - It is the purchase order number issued to the Receiver

Customer PO# - It is the purchase order number issued to the customer.

Some of the main Inco-terms that are used by the exporters or importers
in Tirupur Districts are:

CIF – Cost Insurance and Freight

CFR – Cost and Freight
FOB – Free on Board

Even I have thought about the different schemes used by the exporters to
reduce their tax payment while exporting.

Rebate of State Levies (RoSL) scheme to support the Exporters who export
garment-based products without any duty payment.

Also came to know about the purpose AS and AD code. AS code means,
a code that is used for describing the district from where the goods have been
exported or imported and AD code means Authorised Dealer code.

 AS code: This code is given to each district, to identify from where the
goods are exported. For Tirupur district the AS code is mentioned from 59
to 63.
 AD code: It consists of 7- digits to 14- digits in it. It will be issued by RBI
and the person who applied for this code can get it as printed on a document
with a bank letterhead.
Then about certain particulars that are in the commercial invoices like nature of
payment that are decided by the importer based on the delivery of the goods. In
that mentionable one is:

DAP – Delivery Against Payment is a term of payment in

international trade. It relies on an instrument generally used in international
trade called a bill of exchange or draft. In this term, the documents under
consignment are delivered to buyer/importer only after collecting payment of
goods by buyer's bank.

LUT – Letter of Undertaking is a letter used by registered taxpayers

who export the goods or services will have to furnish Letter of Undertaking
(LUT) in GST RFD-11 form on the GST portal in order to make exports
without payment of IGST.

They also that about the Drawbacks that are provided for the exporters in
certain percentage for each product. To get drawback amount it is important to
get Incentive document, it is a licence to show that the particular person is an
exporter and he/ she has been applied for a drawback amount. These drawback
amounts will be mentioned at the shipping bill.

The staff members even explained about the E – Way bills. It means, the
amount to be paid mainly for the road transportation, for the particular distance
the vehicle has travelled.

They also thought about the ICEGATE. It is a government website that is

used for filing the export and import documents electrically. In addition to e-
filing, ICEGATE also provides host of other services online verification of
DEPB/DES/EPCG licenses, IE code status, PAN based CHA data, IGST
Refund Status and links to various other important websites/information related
to EXIM Trade.
 They also thought what is meant by HS Code and its purpose. HS code
means the Harmonised System Code that is used for identifying each products
using this code instead of mentioning their name. The HS code consist of 8
digits in it.

In export and import Agent who supplies the bill of lading or the bank
who issues the main documents are considered as the Third party. They are
assigned to look after all the financial and documentation and clearance work
that are related to export and import.

Even about the different numbers that are used for mentioning the
different ports are also thought by the staff. The ports are categorised into three
types. They are:

Seaport
Airport
Inland Port or Dry Port

Number 1 is used for mentioning the Seaport

Number 4 is used for mentioning the Airport

Number 6 is used for mentioning the Inland or Dry Ports.

For Example: Chennai (Kaatupalli) INKAT1, Chennai (Meenabakkam)

INMAA4, Chennai (Tiruvottiyur) INTVT6.

Dry ports mean an inland intermodal terminal directly connected by road

or rail to a seaport, operating as a centre for the transhipment of sea cargo to
inland destinations.

They also explained how documentation work differ from export to

import.
At seaways export, some documents are required, they are:

ISF Filling
Multimodal Transport Document
Stuffing inspection Report
Invoice particulars
Customs clearance Document
Commercial Notes
Shipping bill Checklist

In these ISF Filing consists the details about the cargo or the vessels, that
have been registered by the exporter or the shipper. Some of the particulars in
ISF Filing details are:

Liner detail
Stuffing Location
Consolidator name & address
AMS detail

The AMS detail is needed for the purpose to gain the information about
the cargo that enters into the country for import purpose.

Then I even came to know about the customs clearance process and how
many parts it was divided into. For exporting the Customs system is divided
into Five major parts. They are:

Part 1 – Shipping bill summary

Part 2 – Invoice details
Part 3 – Item details
Part 4 – Export scheme details
Part 5 – Declaration
 After this process are done and the verification process is over then the,
customs will provide you the documents with watermark mentioning as “Let
Export Copy”.

These five parts are common for both airways and seaways in export.

Documents related to Exports

Commercial Invoice
Airway Bill
Shipping Bill Checklist
Customs EDI system
Import Process:

Obtaining Import License

Trade Enquiry

Obtaining Foreign
Exchange

Placing an indent order

Opening Letter of Credit

Receiving Shipping
Document

Appointment Of Clearing Settlement of Import Bill

Agents

Fulfilment of Customs Taking Delivery of Goods

Formalities
 In Import documents that are prepared is most important one. There is
major difference in Import while comparing to export. The most important one
in the Import is Tax invoice and Bill of lading.

Then they thought about some license that has to be obtained by the both
exporter and importer. An importer or exporter must have EPCG license, it is
for reduction of tax duty that has to be paid for exporting the capital goods like
Machineries that belong to textiles. After importing the goods, the manufacturer
has to export the goods that have manufactured through the machineries or any
other equipment imported, through the EPCG license. If the product is not
manufactured at the time period mentioned and the amount of goods that has
been mentioned. If not, the export duty has to be paid in excess while exporting
the goods, that has been manufactured. This License will be provided by the
DGFT committee.

EPCG - Export Promotion Capital Goods

DGFT - Directorate General of Foreign Trade

Although tax duty is always implied on the goods that is imported by the
consignee and it is mandatory for all the products.

Then they thought about the SAC code, it means Servicing Accounting
Code. It is to represent the service instead of goods and it consists of six digits
in it. It will be mentioned at the Insurance document and code starts with the
number 99. The insurance document will be issued by the importer’s bank if it
is applied.

These are the main particulars that are thought about in the seaways
import.
The seaways import documents are mentioned as follows. They are:

Tax Invoice
Bill of Lading
Attachment
Commercial Invoice
Certificate of origin
Customs Clearance File
Checklist (Bill of Entry)
Insurance document (If claimed)

Tax invoice is the main document that consists of the details or the
particulars like to whom the bill is sent, container number, who is the importer
and it will be mentioned LCL based goods or not.

LCL – It means the importer has to pay the amount for the particular
capacity of goods loaded into the vessels. In this type of service, the goods
that are loaded into the vessels won’t be completely filled to its actual
capacity.

Certificate of Origin:

It is a document that is used for declaring that the products or the goods
manufactured belongs to which country. It is also used for clearing the doubts
of customs about the nature and origin of the product imported.

The customs clearance process includes of the following parts. They are:

Bill of entry summary

Invoice and valuation details
Duties
Additional details
Other compliances
Declaration

Documents of Import

Tax Invoice
Bill of Lading
Packing List
Airway Bill
Import Terminal Challan
Conclusion:
 In these 15 days I would come to know what are all the main documents
and the procedures that are involved in the Export and Import documentation.
Through the help of company staffs, I would come to know more about the
detailed information about the particulars that are mentioned in the documents.
Through this Internship I have come to know how logistics plays an important
role in Export and import.