Custom, Excise & Service Tax Tribunal
M/S Skyways Air Services Pvt. Ltd vs Cc (I&G), New Delhi on 29 July, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. I DATE OF HEARING : 27/07/2016. DATE OF DECISION : 29/07/2016. Customs Appeal No. 51335 of 2016 [Arising out of the Order-in-Appeal No. 07/SM/Policy/2016 dated 23/02/2016 passed by The Commissioner of Customs (General), New Delhi.] For Approval and signature : Honble Shri Justice Dr. Satish Chandra, President Honble Shri B. Ravichandran, Member (Technical) 1. Whether Press Reporters may be allowed to see : the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? 2. Whether it would be released under Rule 27 of : the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair : copy of the order? 4. Whether order is to be circulated to the : Department Authorities? M/s Skyways Air Services Pvt. Ltd. Appellant Versus CC (I&G), New Delhi Respondent
Appearance Shri Prabhat Kumar, Advocate for the appellant.
Shri Dr. S.K. Sheoran, Authorized Representative (DR) for the Respondent.
CORAM : Honble Shri Justice Dr. Satish Chandra, President Honble Shri B. Ravichandran, Member (Technical) Final Order No. 52678/2016 Dated : 29/07/2016 Per. B. Ravichandran :-
The appeal is against order dated 23/2/2016 of Commissioner of Customs (General), New Custom House, New Delhi. The appellant is a registered authorized courier, essentially engaged in the business of freight forwarding as an IATA agent. They have applied for and obtained registration as authorized courier in 2009 in terms of Regulation 10 (1) of Courier Imports and Exports (Clearance) Regulations 1998 [CIER, 1998], corresponding to Regulation 10 (1) of Courier Import and Export (Electronic Declaration and Processing) Regulation, 2010 [CIER, 2010]. The registration is valid up to 30/1/2019. Consequent upon certain guidelines issued in 2010 by the Board vide Circular No. 33 of 2010 dated 7/9/2010, the Commissioner of Customs reviewed the facilities available with the authorized courier appointed under the said Regulations to ensure proper compliance. On noticing that the appellant has not furnished bank certificate or solvency certificate worth Rs. 25,00,000/- in view of the amendment in the Regulation 8 (1) of CIER, 1998 w.e.f. 12/8/2010, proceedings were initiated against the appellant by way of issue of show cause notice dated 15/6/2015 proposing revocation of registration and forfeiture of security deposit. On conclusion of the adjudication proceedings the impugned order was passed. Though the show cause notice alleged contravention of provisions of various Regulations Regulation 5 (3), 6 (3), 8 (1), 8 (2), 12, 13h and 13 (j) of CIER, 1998, the Original Authority finally concluded that there is only a contravention of Regulation 3 (a) of CIER 1998/Regulation 3 (1) (c) of CIER, 2010. He also recorded that in view of the amendment carried out in Regulation 8 (1) effective from 12/8/10, the appellant delayed the compliances of furnishing solvency of Rs. 25,00,000/-. Hence, the same called for penal action. Accordingly, the Original Authority revoked the appellants courier registration and also ordered forfeiture the whole amount of security deposit of Rs. 10,00,000/-
2. The learned Counsel for the appellant submitted that the appellants have not committed any violation of the Regulations CIER, 1998 or CIER, 2010. He submitted that as per the amended provisions of the Regulation they have complied with requirement of furnishing bank guarantee and also solvency certificate. This has been taken note of in the impugned order itself, however, the Commissioner records that there is a delay, hence, the appellant is liable for penal action. The learned Counsel submitted that as per the guidelines issued in 2010 [after their registration was approved in 2009] they have initiated the process of putting up of infrastructure facilities and branch offices in order to have a secured smooth operation of express door to door delivery of goods. The learned Counsel admitted that they are yet to complete the process as the same is capital intensive and required investment in IT infrastructure and various other office facilities. He pleaded that when it is an admitted fact that they have not filed any courier bill for clearance of import or export cargo so far, the question of their contravening any of above-mentioned Regulations do not arise. When asked specifically as to why they are not able to put up the upgraded infrastructure facilities, the learned Counsel submitted that they are in the process of procuring various equipments including x-ray scanning machine and other IT infrastructure so that they are fully equipped for the operation of authorized courier. He submitted that all the requirements will be in place by December 2016 and they will demonstrate to the Customs Authorities that they are fully equipped in terms of the international requirement and guidelines.
3. The learned AR reiterated the findings of the lower Authority and stated that the Commissioner is correct and reviewing the facilities available with the authorized courier and when found wanting he has taken action of revocation.
4. Having heard both the sides and on perusal of appeal records, we find that the only substantial allegation against the appellant based on which their registration was revoked alongwith forfeiture of Rs. 10,00,000/- security deposit, is that they are not authorized courier as per Regulation 3 (a) of CIER, 1998/Regulation 3 (1) (b) of CIER, 2010. We note that both these are definition clause of authorized courier. We note that the registration in 2009 has been granted by the Competent Authority, apparently after due process. The review of the registration has been done prompted by guidelines for improved monitoring of cargo movement issued by the Board in September 2010. It is an admitted fact that the appellant have not filed any bill for clearance of any import or export package and are yet to start their operation as authorized courier in terms of the registration granted. In such situation, we find forfeiture of Rs. 10,00,000/- security deposit without any contravention by the appellant is not justifiable. Such punitive action has to have a premise of violation of certain provision of law. The same is not demonstrated in the present case. Regarding revocation of registration, we find the action of the lower Authority is preemptive though aimed at enforcing certain revised guidelines for improved monitoring and better compliance of cargo movement across the border. We find that taking into consideration the submissions made by the appellant and also the fact that they are yet to commence the operation that and are pleading the financial difficulty as a reason for delay in improving the infrastructure, we find it fit and proper to direct the learned Commissioner for re-verification of the facilities in December 2016 by which time the appellant has undertaken to put up all the required infrastructure in place and thereafter to take a fresh decision about the continuation of the appellant as authorized courier in terms of the above Regulations.
5. With the above observation, we set aside the impugned order and remand the matter back to the Original Authority for a fresh consideration.
(Order pronounced in the open court on 29/07/2016.) (Justice Dr. Satish Chandra) President (B. Ravichandran) Member (Technical) PK ??
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