The Delhi High Court upheld the penalty of Rs. 50,000 imposed by the Commissioner of Customs in terms of Regulations 13A(7) and 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, on the Dart Air Services Courier Agency, for failing to exercise due diligence leading to violation of Regulation 12 (1)(iii) & 12 (1)(vii) of the 2010 Regulations.
The Court noted that after the SIIB’s investigation, various facts revealed that commercial goods were being sent under the disguise of `gifts’, and the failure of the Courier to notice the same clearly shows non-exercise of due diligence. Reference was made to Regulation 12 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, which imposes significant obligations on the courier agencies, and the same ought to be taken seriously.
The Division Bench comprising Justice Prathiba M. Singh and Justice Shail Jain observed that courier agencies, such as the Petitioner, do have a responsibility to ensure that whenever any suspicious courier packets are being delivered or being transacted through them, due diligence ought to be exercised, and if there is any suspicion, the same ought to be reported to the concerned authority.
The Bench pointed out various obligations that are imposed on an approved Courier agency, and emphasized that under Regulation 13, the registration of an Authorised Courier can be revoked on the grounds specified therein, such as non-compliance with its obligations, misconduct, etc. The Bench also added that under Regulation 14, if the Authorized courier has acted contrary to any provisions of the Regulations, 2010, or abets any contravention, or fails to comply with the provisions of the Regulations, 2010, the Commissioner of Customs is well within his rights to take action.
Briefly, in this case, an incident was reported for verification of certain courier parcels through the Petitioner (authorised courier agency), where the consignee was one Sayra Ansari, wife of Munna @ Abdul Munna Ansari, who had a London address in Broadway, South UK. Thereafter, the Special Intelligence & Investigation Branch (SIIB) sent a letter to the Respondent-Customs Department, requesting the suspension of the Registration of the Petitioner, alleging that the husband of the consignee used to send parcels from London, containing cut cloth pieces along with measurements/designs for stitching, and these cut pieces of clothes were stitched at the residence of the consignee in India, where stitching machines were installed.
According to the SIIB, the stitched items were then being sent back to the consignor in London, who was running a tailoring business there, and therefore, the parcels of commercial quantity being sent for business purposes were incorrectly described as ‘gifts’. Resultantly, a Show Cause Notice (SCN) was issued to the Petitioner, suspending its registration with immediate effect. The Chief Commissioner of Customs also rejected the request of the Petitioner seeking revocation of the suspension.
In the meantime, an inquiry report was submitted concluding that the authorized courier has not violated the clause (iii), (v), and (vii) of Sub-regulation No. (1) of Regulation No. 12 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010. However, a disagreement note was generated by the Office of the Commissioner of Customs (Airport & General), expressing disagreement in respect of the inquiry report. This disagreement note came to be challenged in writ. During the pendency of the writ petition, the courier registration of the Petitioner was not revoked, and rather a penalty of Rs. 50,000 was imposed.
Appearances:
Advocates Biraja Mahapatra and Nalin Hingorani, for the Petitioner/ Taxpayer
Advocates Vijay Joshi and Kuldeep Singh, for the Respondent/ Revenue
