TaxTMI 
TaxTMI 
2025 (7) TMI 12
X X X X Extracts X X X X
X X X X Extracts X X X X
.... business of providing courier services. The petitioner was granted registration under the 1998 Regulations for conducting its business of clearing express import/export cargo through the courier mode as an authorised courier at the Mumbai terminal. 3. In the first week of November 2012, intelligence was received that the two consignments imported from gulf country carried contraband gold jewellery. Based on this intelligence, two consignments covered by Airway Bills ('AWB') Nos. 9717334743 and 9717334738 dated 8 November 2012 were detained. The clearance of the said two consignments were handled by the petitioner for which 'Form IV' Bill of Entry was filed by the petitioner. The goods were declared as 'Die and Hydraulic bottle jack' valued at Rs. 8,728/- and the importers were entities controlled by one Shri Mansukhlal Dhanak. On an in-depth enquiry and examination of the said two consignments, gold jewellery weighing 4879.9 gms. was found concealed in the die and hydraulic bottle jack. The estimated value of the gold on the date of seizure was Rs. 1.21 crore. 4. On investigation, it was revealed that the petitioner was handling courier parcels of 'Balaji Engineering', 'Cham....
X X X X Extracts X X X X
X X X X Extracts X X X X
....have heard learned counsel Mr. Shetty for the petitioner and the learned counsel Ms. Majumdar for the respondents. We propose to deal with the submissions of the parties in our analysis and findings. Analysis & Conclusions:- 11. On 9 November 1998, the Central Board of Excise and Customs through a notification notified the Regulations for regulating the business of courier at the Airport for the purposes of import and export. These regulations are called "the Courier Imports and Exports (Clearance) Regulations, 1998". These 1998 Regulations apply for assessment and clearance of goods carried by the authorised couriers on incoming or outgoing flights or by any other mode of transport on behalf of a consignee or consignor for a commercial consideration. 12. Regulation 3 defines certain terms like "Authorised Courier," "documents," etc. Regulation 4 deals with packaging of goods to be imported or exported by courier. The said regulation provides that the goods shall be packed separately in identifiable courier company bags, with appropriate labels and each package of import or export goods shall bear a declaration from the sender regarding the contents of the package and the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....earance of import goods or [of] export goods; (g) maintain records and accounts in such form and manner as may be directed from time to time by an [Assistant Commissioner of Customs or Deputy Commissioner of Customs] and submit them for inspection to the said Assistant Commissioner of Customs or an officer authorised by him, wherever required. (i) verify the antecedent, correctness of Importer Exporter Code (IEC) Number, identity of his client and the functioning of his client in the declared address by using reliable, independent, authentic documents, data or information; (j) (not sub-contract or outsource functions permitted or required to be carried out by him in terms of these regulations to any other person, without the written permission of the "[Principal Commissioner of Customs or Commissioner of Customs, as the case may be]" 16. We now propose to deal with each of the Regulations which have been invoked in the present case. Regulation 13(a):- 17. Regulation 13 (a) provides that the Authorised Courier is obliged to obtain an authorisation, from each of the consignees of the import goods for whom such courier has imported such goods and su....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hri Mohan Naik dated 10 November, 2012. Therefore, the contention of the petitioner that there is an authorisation in their favour, which is at page 76 of the Writ Petition, is required to be rejected. 23. Secondly, the said document is dated 11 April, 2012 whereas the consignment detained is of 8 November, 2012. The said document does not say the petitioner is authorized to clear the goods imported by the importer for all times to come. The authorisation should be on or before the date of imports. Statements subsequently recorded in which the Petitioner is said to have been authorised is not compliance if Regulation 13(a). Thirdly, the said document only states that the delivery will be taken from Andheri office and the consignment should not be sent to Rajkot. Therefore, even on this count the said document does not comply with the requirement of Regulation 13 (a). Fourthly, Shri Mohan Naik in his statement on 29 November, 2012 admitted that he had prepared the said document on the letterhead of Balaji Engineering. The said statement clearly shows that there is no authority as contemplated under Regulation 13(a) in favour of the petitioner by any of the entities belonging to S....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Authorities on this count. 29. Shri Mansukhlal Dhanak, in his statement on 10 November, 2012, has admitted that he does not have any IEC issued in the name of his company. There is no rebuttal of this by the petitioner. Shri Mansukhlal Dhanak in his statement has also admitted that the addresses of the three entities are bogus and fake. He has also admitted that the business of clearing the imported goods was given to the petitioner by Shri Mohan Naik, who happened to be known to Shri Dhanak. Furthermore, the airway bill annexed at page 116A of the Writ Petition in favour of 'Chamunda Trading', shows the address of Borivali, Mumbai. We, therefore, do not accept the contention of the learned Counsel for the petitioner that the obligation cast under Regulation 13(i) has been discharged. 30. The said regulation requires the authorised courier to verify not only the correctness of the IEC but also to verify the antecedents of the importer, identity of the importer and functioning of the importer at the declared address by using reliable, independent, authentic documents, data or information. We have not been shown any material by the petitioner that would compel us to conclud....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 37. At the outset, we wish to state that we have not been shown any records or documents which the petitioner claims to have maintained in compliance with Regulation 13(g). The order in O-I-O categorically states that the petitioner could not produce any authentic records of the entities controlled by Shri Mansukhlal Dhanak. None of the documents of these entities were produced before us. The said findings in the O-I-O have been confirmed by respondent No.3. Except for making a bald statement, we have also not been shown what records the petitioner has maintained with respect to the entities of Shri Mansukhlal Dhanak. Therefore, in our view, there is violation of Regulation 13(g) by the petitioner. In the absence of any perversity shown in the impugned orders and the failure of the petitioner to produce any records before us, we do not agree with the contention of the petitioner that there has been compliance of Regulation 13(g). Regulation 13(j):- 38. Regulation 13(j) provides that an Authorized Courier shall not sub-contract or outsource functions to be carried out by him without the written permission of the Principal Commissioner of Customs or Commissioner of Customs.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e facts narrated above clearly demonstrate that the petitioner has been negligent in carrying out its obligation under the 1998 Regulations. These obligations are cast on the Authorised Courier since the petitioner was engaged in the business of clearance of imports and exports. There is a high degree of responsibility cast upon the petitioner in the discharge of its functions because the repercussions of illegal imports and exports are economically and otherwise also far reaching. 43. In the instant case, more than 250 consignments were cleared by the petitioner on behalf of the entities which were not genuine. It is only after a period of six months and on receipt of intelligence that the two consignments under consideration were detained and from which approximately 4879 gms. of gold was seized. The said gold was smuggled into the country in violation of the law. Had the petitioner discharged its obligation under Regulation 13, the illegality committed by the bogus entities of Shri Mansukhlal Dhanak could have been prevented at least from being carried out through the petitioner. Shri Dhanak has admitted in his statement that payments for all these consignments were sent to t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cation is because the petitioner failed to carry out its obligations under the 1998 Regulations which if carried out would have detected the bogus importers and saved the nation of the outflow of foreign exchange by illegal means. It is with the said object that obligations are framed under the 1998 Regulations. 46. The Government has been simplifying the law and procedure relating to imports through courier from time to time. Accordingly, lot of trust and reliance has been placed on the courier agencies. A very clear procedure has been put in place by way of Courier Regulations to stream line the imports through courier mode. It was incumbent upon the Petitioner courier agency to adhere to the Regulations in order to safeguard the interest of Revenue and the trust placed on them. The Petitioner was mandated to work within the legal framework of the Customs Act, 1962, Rules and Regulations made thereunder. The Petitioner failed to do so. The Petitioner did not exercise due diligence in discharging its obligations under the Regulations. By violating the Regulations, it had given scope for massive misuse of the facility given in addition to loss of Revenue. In short, the Petitione....
X X X X Extracts X X X X
X X X X Extracts X X X X
....) 4 SCC 687 wherein the Supreme Court has affirmed that for revocation of license mens rea is not relevant if there is non-compliance of obligations cast under the Regulations. The relevant para 18 of the said decision reads as under: In this regard, Ms Mohana, learned Senior Counsel for the appellant, has placed reliance on the decision in Noble Agency v. Commr. of Customs [Noble Agency v. Commr. of Customs, (2002) 142 ELT 84 (Tri)] wherein a Division Bench of CEGAT, West Zonal Bench, Mumbai has observed : (ELT p. 87, para 12) "12. The CHA occupies a very important position in the Custom House. The Customs procedures are complicated. The importers have to deal with a multiplicity of agencies viz. carriers, custodians like BPT as well as the Customs. The importer would find it impossible to clear his goods through these agencies without wasting valuable energy and time. The CHA is supposed to safeguard the interests of both the importers and the Customs. A lot of trust is kept in CHA by the importers/exporters as well as by the government agencies. To ensure appropriate discharge of such trust, the relevant regulations are framed. Regulation 14 of the CHA Licensin....