TaxTMI 
TaxTMI 
2010 (11) TMI 680
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....ection 117 of the Customs Act upon the appellant by the impugned order. 2. The Stay Petition has been examined by me. The Assistant Commissioner of Customs (P) has ordered detention of the goods and sale of the said goods equal to the amount of custom duty payable by the appellant. Infact, pursuant to the said order in original, the customs authorities have separately kept aside the said goods and have sealed them and kept them in the Airport premises. Prima facie, based on the apparent merits, stay is granted and appeal taken up for final disposal. 3. Brief facts are that : (i) The appellant is operating two Duty Free Shops at the Dabolim Airport, Goa, one in the arrival area and one in the departure area. The goods from the duty free shop are sold to the incoming and outgoing international passengers on payment of foreign exchange. (ii) The Duty Free Shop is open 7 days a week and 365 days in a year without any break. Both the shops are located beyond the customs barrier in as much as in the arrival area it is prior to the customs counters and in the departure area it is after the customs counter. (iii) Th....
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....eal against the impugned order. (a) The allegations made in the notice under Section 72 that the appellant has not got the warehousing period extended in receipt of the goods imported by them is not correct. The notice under Section 72 does not make a mention as to whether the goods pertain to the Chowgule Warehouse or in the Duty Free Shop and there is no indication in the said notice as to the period for which the extension has not been sought by the appellant. Therefore, the appellant has been left in the dark as to the nature of the allegations against him based on which demand for duty is made and the notice under Section 72 does not make the position clear. Thus the appellant has been kept in the dark about the nature of allegations made against him and consequently the appellant is denied a proper opportunity to defend himself and therefore the order under appeal is required to be quashed and set aside. (b) That the appellant has always sought extension of the bond in respect of the goods stored in the Chowgule Warehouse in the Domestic Tariff Area/local area if the warehousing period is expiring in respect of any bond. There....
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.... Commissioner are both illegal and unsustainable in law and are required to be set aside. (e) That the only argument put forth by the Assistant Commissioner is that the Duty Free Shop is licensed under Section 58 of the Customs Act and therefore the provision of Section 61(b) would apply to storage of the said goods in the Duty Free Shop till sale to the passengers. They have submitted that this finding is not sustainable in law and is an improper finding and erroneous in clear violation of the terms of the license and thus this reasoning given in the order under appeal is not valid in law and the entire order is required to be quashed and set aside. (f) That the Assistant Commissioner has erroneously assumed that since the license is issued under Section 58 of the Customs Act for operating the Duty Free Shop the provisions of Section 61(b) is also applicable to the storage of goods in the Duty Free Shop after transfer from the Chowgule Warehouse. Therefore the Assistant Commissioner erroneously concluded that even in respect of the goods stored in the Duty Free Shop, the warehousing period is one year and extension of the bon....
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.... Act are themselves not applicable the question of demanding duty by the Assistant Commissioner of Customs on the ground that extension of the bond has not been sought till the goods are sold in the Duty Free Shop does not arise. (i) That even the other requirement of a warehouse viz Section 62 of the customs Act has been done away with in respect of the Duty Free Shop as per the terms of the license. In fact the terms of the license make it very clear that the supervision of the Customs Department is limited to ensure that the goods are sold only to the arriving and departing passengers from the Duty free Shop. Therefore when the Department is well aware that the Duty Free Shop is a retail outlet and that they had only the provision of Section 58 to license the same, they have consciously avoided to apply the other provisions relating to private bonded warehouse to the operation of the Duty Free Shop. Therefore the reasoning of the Assistant Commissioner that because of the Section 58 the Appellant has to seek extension of bonding period till goods are actually sold is not correct. (j) That the further reasoning that th....
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....e reasoning that the extension of the bond has to be sought till the goods are actually sold in the Duty Free Shop, the matter had been taken up in appeal before the Commissioner (Appeals) and vide order dated 3-3-2006 the Commissioner (Appeals) has accepted the contention of the appellant that once the goods are transferred from the warehouse to the Duty Free Shop there was no requirement for the appellant to seek extension of the bond. This procedure was followed by the Customs Department in Mumbai on the same terms as prescribed on the terms of the license for operating the said Duty Free Shop in Goa. Therefore, the impugned order dated 10-6-2010 passed by the Assistant Commissioner of Customs is unsustainable in law. 5. I have examined the impugned order and submissions. 6. The Duty Free Shop is a retail outlet where the imported goods are sold to the arriving or departing passengers at the International Airport by the ITDC Ltd. The bond is given for warehousing the goods in the domestic tariff area and once the goods are transferred from the said warehouse to the Duty Free Shop for sale, the question of seeking extension would not arise. In the present case, all th....
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....uty Free Shop. 10. Further, the control over the warehoused goods under Section 62 of the Customs Act is also not applicable in the case of the Duty Free Shop. The said Section 62(2) which requires that no person shall enter a warehouse or remove the goods therefrom without the permission of the proper officer is not applicable to the Duty Free Shop since the goods are sold to the arriving and departing passengers at the Airport by the ITDC staff directly. Therefore, to say that there is a violation of Section 72(1)(b) is not correct. Moreover, the provisions of Section 62 are applicable only to the goods stored in the domestic tariff area i.e. Chowgule Warehouse where all the requirements of Section 62 are fulfilled. 11. The requirement of seeking extension of the warehousing period till the goods are sold in the Duty Free Shop is not applicable in the case of the Duty Free Shop. The extension of warehousing period cannot be linked to sale of goods. Infact, there is no co-relation between the said two actions. Therefore, the action of the Customs Department to link the final sale of goods from the Duty Free Shop for counting extension of warehousing period is not corre....