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2013 (4) TMI 308 - AT - CustomsSec. 45(1) of the Customs Act, 1962 - Regulation 2 of the Handling of Cargo in Customs Areas Regulations, 2009 includes a custodian as referred to in Sec.45 & sub-section (2) of Section 141 of the Act - JNPT is the custodian & the appellants are working as CFS on behalf of JNPT - Held that - The appellants are not directly involved with the customs. They are working on behalf of JNPT and JNPT has given licence to the appellants to work as CFS on furnishing the bank guarantee of Rs.24 crores. By mere denying by JNPT that they are not responsible for the activities of the appellants does not seem to be correct - In fact, the dispute is between the JNPT and the Customs - The Commissioner of Customs (Export) Nhava Sheva was not required to pass this order - We, therefore, set aside the impugned order in the light of the above discussions and allow the appeal with consequential relief - Appeal is disposed of in the above terms - Submission of bond are required to be complied by JNPT.
Issues:
1. Interpretation of Handling of Cargo in Customs Areas Regulations, 2009. 2. Requirement of bank guarantee and bond for custodians. 3. Applicability of regulations to co-custodians. 4. Dispute between custodian and customs authorities. Interpretation of Handling of Cargo in Customs Areas Regulations, 2009: The case involves a challenge to an order under the Handling of Cargo in Customs Areas Regulations, 2009. The regulations define a 'Customs Cargo Service Provider' and set conditions for handling imported and exported cargo in customs areas. The dispute arises from the interpretation of these regulations, specifically regarding the roles of custodians and co-custodians in the handling of goods at a Container Freight Station (CFS) and Buffer Yard (BY) belonging to the JNPT. Requirement of bank guarantee and bond for custodians: The Notification No.16/2005 appointed the appellants as co-custodians under Sec.45(1) of the Customs Act, 1962, requiring them to execute a bank guarantee and bond before commencing import/export/transshipment operations. However, the introduction of Handling of Cargo in Customs Areas Regulations, 2009 altered the concept of co-custodians and imposed new requirements on custodians, including the execution of a bond and bank guarantee. The appellants argue that as service providers to JNPT, who is the custodian, they are exempt from these requirements applicable to custodians. Applicability of regulations to co-custodians: The appellants contend that they are not directly involved with customs operations but work on behalf of JNPT, who holds the custodian role. They maintain that being a major port, JNPT is not obligated to furnish a bank guarantee or cash deposit, as per Condition 5(3) of the regulations. The dispute centers on whether the appellants, as co-custodians, are subject to the same obligations as custodians under the regulations. Dispute between custodian and customs authorities: The Tribunal analyzed the roles of the appellants, JNPT, and the customs authorities in light of the regulations. It concluded that JNPT is the custodian responsible for handling goods, while the appellants operate as CFS on behalf of JNPT. The Tribunal found that the dispute primarily concerns JNPT and customs, rather than the appellants directly engaging with customs. Consequently, the impugned order was set aside, and the appeal was allowed with consequential relief, highlighting the need for clarity in the roles and responsibilities of custodians and co-custodians in customs operations.
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