Bombay High Court
The Commissioner Of Customs (Ii) vs Lynx Express Pvt.Ltd on 27 January, 2020
Bench: Nitin Jamdar, Makarand Subhash Karnik
1 28 CUAPP 42-2019.doc
Sequeira
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
CUSTOMS APPEAL NO. 42 OF 2019
With
INTERIM APPLICATION NO. 1 OF 2019
The Commissioner of Customs, (II)
Airport Special Cargo Commissionerate .. Appellant/Applicant
Vs
Lynx Express Pvt. Ltd. .. Respondent
Mr.Pradeep Jetly a/w Mr.J.B.Mishra, for the Appellant / Applicant.
Mr.Prakash Shah a/w Mr.Vinay Ansurkar a/w Mr.Jas Sanghavi i/b
Legal Solutions, for the Respondent.
Digitally
signed by
Sanjay K.
Sanjay K.
Nanoskar
Nanoskar
Date:
2020.02.05
CORAM : NITIN JAMDAR &
12:42:42
+0530 M.S.KARNIK , JJ.
Date : 27 January 2020.
P.C. :
The Appellant has challenged the Judgment and Order dated 25 January 2019 passed by the Customs, Excise and Service Tax Appellate Tribunal, Mumbai in Appeal No.C/87576 of 2016.
2. By this Appeal, the Appellant has raised following questions of law :
2 28 CUAPP 42-2019.doc '(i) Whether the CESTAT could entertain any Appeal against an order dated 26-10-2015 of the Principal Commissioner of Customs, APSC which had already merged, after the prescribed process of representative appeal, with the Order of the Chief Commissioner of Customs Mumbai Zone III dated 14.09.2016, especially when the Appeal against such Order of the Chief Commissioner was voluntarily withdrawn by the same Appellant and no further remedy was sought against such order?
(ii) Whether the CESTAT has jurisdiction to entertain any Appeal against an Order of the Principal Commissioner under regulations 14(1) of the Courier Import & Export (Clearance) Regulations, 1998, if such order has already been represented to the Chief Commissioner as prescribed under regulation 14(2) and such representation has been disposed by a speaking and reasoned Order of such prescribed Appellate Authority?
(iii) Without prejudice to the above grounds, whether the Honourable CESTAT's Order is legal & proper in its conclusion that no inquiry was conducted pursuant to suspension of the registration when it is clearly detailed in the Order in Original dated 26-11-2015 that, the decision to grant no further license was being ordered with attendant forfeiture and penalty based on the inquiry/investigation conducted by issue of SCN dated 12-12-2014 as adjudicated by Order in Original dated 26-10-2015?'
3. The Respondent Lynx Express Private Limited was registered as an Authorised Courier under the provisions of the Courier Import and Export (Clearance) Regulations, 1998 (the 'Regulations'). According to the Appellant, the officers of the Air 3 28 CUAPP 42-2019.doc Courier Cell and Air Intelligence Unit seized substantial quantity of gold concealed in various packages. The scrutiny of the documents revealed that the consignments were in the name of the Respondent who had filed CBE-IV for clearance of these consignments. Investigation was carried out by the Air Intelligence Unit and, according to the Appellant, various persons in the Respondent were involved in these operations. Statement of the director of the Respondent was recorded. On 26 June 2014, the license of the Respondent to act as an Authorised Courier was suspended. Show- cause notice was issued on 12 December 2014 to all concerned including Respondent under the provisions of section 124 of the Customs Act, 1962. Further investigation was done by Air Intelligence Unit. Notice was issued to the Respondent on 19 March 2015 under Regulation 14 of the Regulations to show cause why the registration granted to the Respondent be not cancelled, why forfeiture of security should not be ordered and why penalty should not be imposed. Thereafter the Principal Commissioner of Customs by Order dated 27 November 2015 cancelled the registration to operate as an Authorised Courier in terms of the Regulations.
4. The Respondent made a representation to the Chief Commissioner under Regulation 14(2) of the Regulations on 5 January 2016. This representation was rejected by the Chief Commissioner of Customs on 14 September 2016 in Order No.2/2016/CCO/MZ-III. Thereafter the Respondent filed two 4 28 CUAPP 42-2019.doc appeals before the Tribunal. One challenging the order passed by the Principal Commissioner dated 26 November 2015 i.e. Order-In- Original. Another challenging the order dated 14 September 2016 rejecting the representation. The Tribunal entertained the appeal against the Order-In-Original dated 26 November 2015 and set aside the said order by impugned decision dated 25 January 2019. The Respondent had withdrawn the appeal challenging the rejection of representation by order dated 14 September 2016. Hence the present appeal on the above-mentioned question of law.
5. Since the question centers around Regulation 14, for ready reference, the same is reproduced as under:
"REGULATION 14. Deregistration.- (1) The Commissioner of Customs may revoke the registration of an Authorised Courier and also order forfeiture of security on any of the following grounds, namely:-
(a) Failure of the Authorised Courier to comply with any of the conditions of the bond executed by him under regulation 11;
(b) failure of the Authorised Courier to comply with any of the provisions of these regulations;
(c) misconduct on the part of Authorised Courier whether within the jurisdiction of the said Principal Commissioner or Commissioner of anywhere else, which in the opinion of the Principal Commissioner or Commissioner renders him unfit to transact any business in the Customs Station.
Provided that no such revocation shall be made unless a notice has been issued to the Authorised Courier information him the grounds on which it is proposed to 5 28 CUAPP 42-2019.doc revoke the registration and he is given an opportunity of making a representation in writing and a further opportunity of being heard in the matter, if so desired.
Provided further that, in case the Principal Commissioner or Commissioner of Customs, as the case may be considers that any of such grounds against an Authorised Courier shall not be established prima facie without an inquiry in the matter, he may conduct the inquiry to determine the ground and in the meanwhile pending the completion of such inquiry, may suspend the registration of the Authorised Courier. If no ground is established against the Authorised Courier, the registration so suspended shall be restored.
(2) Any Authorised Courier or the officer of the Customs authorised by the Principal Chief Commissioner of Customs or Chief Commissioner of Customs in this behalf, if aggrieved by the order of Principal Commissioner of Customs or Commissioner of Customs, as the case may be passed under sub-regulation (1), may represent to the Principal Chief Commissioner of Customs or Chief Commissioner of Customs as the case may be in writing against such order within sixty days of communication of the impugned order to the Authorised Courier and the Principal Chief Commissioner of Customs Chief Commissioner of Customs, as the case may be shall, after providing the opportunity of being heard to the parties concerned, dispose of the representation as expeditiously as may be possible."
6. As regards the first two questions of law (i) and (ii) are concerned, they seek to question the jurisdiction of the Tribunal to entertain the appeal from the Order-In-Original. It is the argument 6 28 CUAPP 42-2019.doc of the Appellant that when appeal against order of Chief Commissioner was withdrawn and no further remedy was sought, an appeal before the Tribunal from the Order-In-Original could not have been entertained. This submission cannot be accepted. The Tribunal has entertained the appeal against the Order-In-Original relying on the decision of the Division Bench of this Court in the case of Principal Commissioner of Customs vs. Bombino Express Pvt. Ltd.1. In this case also an identical argument was advanced. The Appellant in this case also had approached the Tribunal after rejection of the representation. In the case of Principal Commissioner of Customs vs. Bombino Express Pvt. Ltd., objection was raised to the jurisdiction of the Tribunal on the ground that there was merger of the order passed under representation with the Order-In-Original and thereafter no appeal should have been entertained by the Tribunal. This was rejected by the Tribunal and when the appeal came up for consideration the Division Bench noted the argument and observed thus :
"10. We do not think that we should entertain such an argument by the Revenue and at this belated stage. The Tribunal has found that throughout, the matter was contested on merits. Further, the issue of maintainability was also dealt with at an earlier stage. The argument was once the Chief Commissioner acted as an appellate authority, he would scrutinise the legality and validity of the order-in-original, then, all the more against this order, no appeal would lie.
11. We have found from a reading of the 1 2018 (13) G.S.T.L. 52 (Bom.)
7 28 CUAPP 42-2019.doc regulations that they are traceable to the power conferred in the authorities vide the Customs Act, 1962 and several notifications issued thereunder. The regulations apply for assessment and clearance of goods carried by the authorised courier on incoming or outgoing flights or any other mode of transport. Thus, these are the clearances through courier mode. For that purpose, the authorised courier can be engaged and the term "authorised courier" is defined in Regulation 3 clause (a) of the regulations. Word "documents" is also defined in Regulation 3(b). Then, by Regulation 4, packing of goods to be imported or exported by courier is dealt with. Clearance of import goods is permissible if the procedure set out in Regulation 5 is followed. Similar is the position with regard to export goods and they can be cleared by Regulation 6. As far as registration of authorised courier is concerned, that aspect is dealt with by Regulation 8. There is scrutiny of applications by the Commissioner of Customs in terms of Regulation 9 and then, the registration is granted in exercise of powers of registration under Regulation 10. There are compliances to be made and particularly of execution of bond and furnishing of security. By Regulation 12, it is stated that a courier, who is registered under Regulation 10 or had intimated in form 'A' to the Commissioner of Customs having jurisdiction over the Customs Station from where he has to transact the business, shall furnish a bond and security as specified in Regulation 11 for each Customs Station. The obligation of authorised courier is set out in Regulation 13 and then, there is a power of de- registration. That power is conferred in the Commissioner of Customs. By sub-regulation (2) of Regulation 14, the aggrieved authorised courier and whose authorisation is revoked or he is de-registered, 8 28 CUAPP 42-2019.doc may, if aggrieved by the order of the Commissioner, represent to the Chief Commissioner of Customs in writing against such order of the competent authority and thereafter it is permissible for the Chief Commissioner to dispose of the representation.
12. The Tribunal found that even this mechanism is in place. Eventually, everything is traceable to the Customs Act, 1962 and once the said Act provides for an appeal and that appeal would lie to this Tribunal against the order-in-original, then, merely because a representation or a remedy of making a representation is provided by the Regulations, that does not displace the appellate authority of the Tribunal. We do not think that the Tribunal, in the facts and circumstances of the case, has acted perversely in entertaining the appeal. More so, when the attempt of the Revenue was to question its jurisdiction on more than one occasion. Additionally, we have found that the Tribunal, if approached and it is regularly done in the cases of the Customs House Authorisation Regulations by the aggrieved agent, then, against the orders of the Tribunal restoring the licences or authorisation, the Revenue has brought appeals under the Customs Act, 1962 before this Court. Therefore, one opportunity being provided in the scheme of the law to the aggrieved courier does not cause serious prejudice to the Revenue. More so, when it can always approach this Court against the orders of the Tribunal."
The Division Bench held that what is provided in the Regulation 14(2) is a representation and ultimately the remedy of appeal is available under the Customs Act, 1962 and rejection or otherwise of such representation will not take away the jurisdiction of the Tribunal 9 28 CUAPP 42-2019.doc to entertain the appeal from Order-In-Original. In the present case the Appellant has withdrawn the appeal but if there is no merger and what is decided is only a representation, then withdrawal of the appeal will also fall within the ambit of the view taken by this Court in Principal Commissioner of Customs vs. Bombino Express Pvt. Ltd. In view of the dicta of the Court in the case of Principal Commissioner of Customs vs. Bombino Express Pvt. Ltd., we cannot accept the argument advanced by the Appellant that the Tribunal had no jurisdiction to entertain the Appeal.
7. As regards the third question is concerned it takes exception to the observations of the Tribunal that procedure as contemplated under the Regulation 14 was not followed while revoking the registration of the Respondent. This submission also cannot be accepted. The operative part of the Order-In-Original is ambiguous. It only states that no license to operate be granted to the Respondent under Regulation 10. The learned Counsel for the Appellant submitted that the Order-In-Original revokes the license and there is ample material on record to show that the revocation was justified. There is no debate on the factual position that, after suspension of the license there was no further inquiry giving opportunity to the Respondent before passing the Order-In-Original. The second proviso to the Regulation 14 states that if Principal Commissioner or Commissioner of Customs is of the opinion that grounds cannot be established prima facie without an inquiry, he may 10 28 CUAPP 42-2019.doc conduct an inquiry and in the meanwhile may suspend the registration. If suspension of the license takes place then the proviso contemplates an inquiry. This view is taken in the another decision in the case of Bombino Express Pvt. Ltd v. Chief Commissioner of Customs. Therefore after suspending the registration of the Respondent as an Authorized Courier, an inquiry had to be held giving an opportunity to the Respondent which having not been done, there is no error in the view taken by the Tribunal. In these circumstances, these questions of law do not arise for consideration.
8. The Appeal is accordingly dismissed.
9. In view of dismissal of the Appeal, the Application does not survive and is disposed of.
M.S.KARNIK, J. NITIN JAMDAR, J.