Case Law Details
Commissioner of Customs Vs Entire Logistics Pvt Ltd (CESTAT Delhi)
In a significant ruling, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) in Delhi has clarified that the Revenue cannot appeal against orders issued under the Customs Brokers Licensing Regulations (CBLR). The decision was made during the case of Commissioner of Customs vs. Entire Logistics Pvt Ltd, which examined the validity of an appeal filed by the Revenue against an order dated September 27, 2019.
The original order, issued by the Commissioner, imposed a penalty of ₹50,000 on the respondent, Entire Logistics Pvt Ltd, for violations under the CBLR. However, the Commissioner did not revoke the company’s license or forfeit its security deposit, prompting the Revenue to seek a modification of this order to include these harsher penalties.
During the proceedings, counsel for the respondent raised a critical legal point, arguing that the appeal filed by the Revenue was not maintainable. This assertion was supported by a precedent set by the Delhi High Court in Commissioner of Customs (Airport & General) vs. Transworld Cargo & Travels, where it was determined that the Revenue has no standing to appeal against orders issued to Customs Brokers under the CBLR.
The key issue highlighted was whether the Revenue could invoke Section 129A or 129D of the Customs Act, 1962 to appeal an order made under Regulations 21 or 23 of the CBLR. The High Court ruled that the right to appeal is reserved solely for the Customs Broker in such cases, effectively barring the Revenue from filing appeals. This was substantiated by referencing past cases, including Commissioner of Customs (General) v. Falcon India and Commissioner of Customs (General) v. D.S. Cargo Agency, which further established that the CBLR constitutes a complete regulatory framework that does not permit Revenue appeals.
The CESTAT panel, upon reviewing these precedents, dismissed the Revenue’s appeal as not maintainable. The ruling reinforced the interpretation that the phrase “any person aggrieved” within the context of the Customs Act does not extend to the Revenue in matters related to CBLR orders.
A representative for the department acknowledged the ruling from the Transworld Cargo case but noted that an appeal had been filed against this judgment to the Supreme Court, although no stay had been granted. As a result, the CESTAT reiterated its stance in favor of the established legal framework and maintained that it had no grounds to diverge from the High Court’s previous determinations.
Ultimately, the CESTAT’s ruling serves as a critical reminder of the limitations placed on Revenue’s ability to contest CBLR orders. The dismissal of the appeal underscores the importance of adhering to established regulations and the legal precedents that govern the actions of customs authorities. The cross-objections filed by Entire Logistics Pvt Ltd were also resolved in this decision, bringing closure to the matter.
In summary, this case not only reaffirms the legal boundaries surrounding appeals against CBLR orders but also highlights the ongoing discussions about the roles and powers of regulatory bodies within the customs framework. The outcome is a clear indication that the judiciary will uphold the regulations as intended, preventing any overreach by the Revenue in its efforts to impose penalties on Customs Brokers.
Conclusion
The decision from the CESTAT Delhi in the case of Commissioner of Customs vs. Entire Logistics Pvt Ltd represents a pivotal moment in customs law, reinforcing the notion that only designated parties possess the right to appeal certain regulatory decisions. As the Revenue continues its challenge in the Supreme Court, the implications of this ruling will be closely monitored by industry stakeholders and legal experts alike, who await further clarification on the complexities surrounding the CBLR and the appeals process.
FULL TEXT OF THE CESTAT DELHI ORDER
The Order in Original1 dated 27.9.2019 passed by the Commissioner is assailed in this appeal by the Revenue. In the impugned order passed under the Customs Brokers’ Licensing Regulations2 2018 read with CBLR 2013, the Commissioner imposed a penalty of Rs. 50,000/- upon the respondent but refrained from revoking its licence and forfeiting its security deposit. The prayer in this appeal is to modify the impugned order to the extent that the licence of the respondent may be revoked and its security deposit may be forfeited.
2. When the matter was taken up, learned counsel for the respondent submitted that this appeal is not maintainable because the department cannot file an appeal against the order passed by the Commissioner under CBLR. He relied on the judgment of the Delhi High Court in Commissioner of Customs (Airport & General) vs. Transworld Cargo & Travels3. In this judgment, Delhi High Court, held that the department had no right to appeal against the order passed against a Customs Broker under Customs Brokers Licensing Regulations, 2013. The relevant portions of the order are as follows:
“6. In the aforesaid context, the Revenue has projected the following question for consideration:
“Whether the Ld. CESTAT is right in law in holding that the right to prefer an appeal under section 129A or 129D of the Customs Act, 1962 against an order passed under Regulations 21 or 23 of the Custom Broker Licensing Regulations, 2013 is available only to a Custom Broker (hereinafter “CB”).”
7. In terms of Regulation 21 of the CBLR, 2013, an appeal against the order of the Commissioner is available only to the Custom Broker and not to the Revenue. The question whether an appeal by the Revenue would be maintainable is covered against the Revenue, by the decision of this Court in Commissioner of Customs (General) v. Falcon India: CUSAA No. 278/2018, decided on 10-10-2018/[2019 (368) E.L.T. 35 (Delhi)]. The said decision was also followed by a Coordinate Bench of this Court in Commissioner of Customs (General) v. D.S. Cargo Agency: CUSAA No. 233/2019, decided on 21-9-2022. The Court had held that, CBLR was a complete code. Further, the expression “any person aggrieved” as used in Section 129A of the Customs Act, 1962 would not include Revenue insofar as any order passed by the Commissioner of Customs under the CBLR, 2013 is concerned.
8. We find no reason to differ from the said decisions.
9. In view of the above, the question of law, as projected by the Revenue, is squarely covered against the Revenue by the decisions of the Co-ordinate Bench of this Court in Commissioner of Customs (General) v. Falcon India (supra) and Commissioner of Customs (General) v. D.S. Cargo Agency (supra).
10. The appeal is, accordingly, dismissed.”
3. Learned departmental representative fairly submitted that in Transworld Cargo Delhi High Court held that the Revenue cannot file an appeal against an order passed under CBLR by the Commissioner. Revenue has appealed against this judgment to the Supreme Court but there is no stay on the order.
4. In view of the above, respectfully following the decision of Delhi High Court in Transworld Cargo, we dismiss the appeal filed by the Revenue as not maintainable. Cross objections filed by the respondent also stand disposed of.
(Dictated and pronounced in open court)
Notes:
1 Impugned order
2 CBLR
3 (2023) 10 Centax 122 (Del.)
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