Delhi High Court Upholds Customs Penalty on Dart Air Services for Regulatory Violations
Court dismisses Dart Air Services' petition challenging a Rs. 50,000 penalty imposed by the Commissioner of Customs for inadequate due diligence in courier services.
In a significant ruling, the Delhi High Court has dismissed the petition filed by M/s Dart Air Services Pvt. Ltd., a registered courier company, challenging the imposition of a Rs. 50,000 penalty by the Commissioner of Customs (Airport and General). The penalty was levied under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, following allegations of insufficient due diligence by the courier agency.
The case arose after the Special Intelligence & Investigation Branch (SIIB) flagged an incident involving parcels sent under the guise of "gifts" from London to India, which were actually commercial goods linked to a tailoring business. Despite an inquiry report exonerating the company from certain violations under Regulation 12(1)(iii), (v), and (vii), the Commissioner of Customs disagreed with the findings and imposed the penalty, asserting a contravention of Regulation 12(1)(v).
The judgment, delivered by Justices Prathiba M. Singh and Shail Jain, emphasized the significant obligations imposed on courier agencies under Regulation 12, including the exercise of due diligence. The court noted that the Commissioner of Customs retains the jurisdiction to impose penalties even when an inquiry report does not establish violations, if subsequent evidence or circumstances warrant such action.
The judgment underscores the critical role of courier agencies in ensuring compliance with customs regulations, particularly in identifying and reporting suspicious transactions. The court found the penalty imposed to be within the regulatory framework, reinforcing the importance of due diligence in the clearance of goods through courier services.
The Delhi High Court's decision reaffirms the authority of the Commissioner of Customs to act in the interest of maintaining regulatory compliance, even in the face of conflicting inquiry reports, thereby setting a precedent for similar cases in the future.
Bottom Line:
The Commissioner of Customs has the jurisdiction to impose a penalty under Regulation 14 of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, even if the inquiry report exonerates the petitioner of certain violations.
Statutory provision(s): Customs Act, 1962, Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010, Regulations 12, 13, 13A, and 14
