Commissioner of Customs (General) Vs Sky Shipping (Bombay High Court)
The Bombay High Court dismissed the Revenue’s appeal challenging the Customs Excise and Service Tax Appellate Tribunal (CESTAT) order that had set aside the revocation of a Customs Broker’s licence and forfeiture of its security deposit under the Customs Brokers Licensing Regulations (CBLR), 2018. The Revenue contended that the Customs Broker had violated Regulations 10(d) and 10(e) by failing to ensure compliance with Risk Management System (RMS)-mandated 100% examination requirements and relied on CCTV footage, discrepancies in Container Freight Station (CFS) examination charges, statements recorded under Section 108 of the Customs Act, and judicial precedents to support its case.
The High Court noted that the issue before the CESTAT was whether the Customs Broker had violated Regulations 10(d) and 10(e) of the CBLR, 2018. Regulation 10(d) requires a Customs Broker to advise clients to comply with the Customs Act and allied laws and to report non-compliance to the appropriate customs authority, while Regulation 10(e) requires due diligence in verifying the correctness of information provided to clients.
The Court observed that, after examining the factual matrix, the CESTAT, being the final fact-finding authority, concluded that the Revenue had failed to establish any breach of either Regulation 10(d) or Regulation 10(e). The Tribunal specifically found no evidence that the Customs Broker had failed to advise the importer to comply with statutory requirements or had participated in compelling customs officials to avoid examination of the imported goods. It also noted that the imported goods were such that their classification could not be determined merely by visual inspection and that, apart from a technical violation, there was no material to establish a breach of Regulation 10(d).
