Customs broker licence action failed where FTWZ-SEZ activities were outside the licence extension and alleged breaches were unproved.

Proceedings under the Customs Broker Licensing Regulations, 2018 could not be sustained for activities carried out in an FTWZ unit within the Special Economic Zone regime where there was no Form C intimation under Regulation 7(3) extending the licence to the SEZ area and the inquiry report itself recorded that alleged breaches of Regulation 10(d), (e) and (n) were not proved. On those facts, revocation of the customs broker licence, forfeiture of security and penalty could not be maintained, and the challenge to the order dropping the proceedings failed.

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Issues: Whether the Revenue could proceed under the Customs Broker Licensing Regulations, 2018 to seek revocation of the Customs Broker licence, forfeiture of security and penalty in respect of activities carried out by the respondent in an FTWZ unit in the Special Economic Zone, and whether the alleged contraventions of Regulation 10(d), (e) and (n) of the Customs Broker Licensing Regulations, 2018 were established.

Analysis: The activities in question were undertaken in the FTWZ under the Special Economic Zone regime, and there was no Form C intimation under Regulation 7(3) of the Customs Broker Licensing Regulations, 2018 extending the Customs Broker licence for work in the SEZ area. The inquiry report was treated as the crucial document in proceedings under the Customs Broker Licensing Regulations, 2018, and it recorded that the alleged violations of Regulation 10(d), (e) and (n) were not proved. In that situation, the appeal seeking revocation of licence, forfeiture of security and penalty could not be maintained.

Conclusion: The Revenue could not sustain proceedings under the Customs Broker Licensing Regulations, 2018 on the facts found, and the challenge to the order dropping the proceedings failed.

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