Courier Licence Restoration Upheld as Outsourcing Breach Was Unproved: Bombay HC

Principal Commissioner of Customs Vs Bombino Express Pvt. Ltd. (Bombay High Court)

Summary: Bombay High Court dismissed the Revenue’s appeal challenging CESTAT’s restoration of the authorised courier registration of Bombino Express Pvt. Ltd. The dispute arose after consignments imported by M/s. Smashing Traders Private Limited were detained for alleged misdeclaration and undervaluation, following which the courier’s registration was suspended and subsequently revoked under the Courier Import and Export (Clearance) Regulations, 1998. The Tribunal had set aside the concurrent orders of the Commissioner and Chief Commissioner and restored the registration while forfeiting the security deposit. The High Court rejected Revenue’s objection to CESTAT’s jurisdiction, holding that the Regulations are traceable to the Customs Act, 1962 and the remedy of representation before the Chief Commissioner under Regulation 14 did not displace the Tribunal’s appellate jurisdiction under the Act.

On merits, the Court noted that CESTAT, as the last fact-finding authority, had reappreciated the material and found the alleged violations unsubstantiated. The post-customs-clearance arrangement for domestic delivery to the consignee’s door did not amount to subcontracting or outsourcing a function relating to assessment and clearance of courier parcels so as to establish violation of Regulation 13(j). The Tribunal had also considered the courier’s explanation and material concerning compliance with KYC requirements, past clearances and steps taken to revamp its website, and found that the show cause notice did not point to any KYC infringement causing significant revenue loss. The High Court found no perversity warranting interference with those factual findings and consequently dismissed the Revenue’s appeal without costs.