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TMI Blog2019 (5) TMI 1521X X X X Extracts X X X X X X X X Extracts X X X X ..... sed to also raised invoices on Budget for the activities performed by it (Custom clearance). It is, thus, apparent that the petitioner also performed the service of custom clearance for Budget - Budget had outsourced the activities performed by the petitioner to it. If the activities carried on by Budget and the petitioner are examined, it is at once clear that the role of the petitioner was not that of a courier agency but merely of a service provider engaged in the activity of custom clearance. The activity of a courier includes that of delivery of goods / shipments to customers, and clearance of customs is only an incidental part of the said business. In the present case, the principal business of the petitioner is assistance in custom clearance and not of collection and delivery of goods on a door to door basis. The purpose of framing the 2008 Regulations and 2009 Regulations is to extend expeditious clearance facilities to couriers on the premise that couriers have an elaborate infrastructure for knowledge and information management and such courier companies used their inhouse mechanism to guard against use of supply chain by unscrupulous elements. Plainly, if the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Surender Kumar Sharma. His registration as an Authorized Courier was revoked on the ground that he did not qualify to be an Authorized Courier within the meaning of Regulation 3(1)(b) of the Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 (hereafter the 2010 Regulations ) and Regulation 3(a) of the Courier Imports and Exports (Clearance) Regulations, 1998 (hereafter the 1998 Regulations ). 3. The principal controversy involved in the present petition is whether the petitioner falls within the definition of an Authorized Courier under the 1998 Regulations and the 2010 Regulations and whether the petitioner has complied with his obligations under those Regulations. The principal allegation against the petitioner is that he is not performing functions of a courier but is merely acting as a Custom Clearing Agent. The petitioner disputes the same and states that all noncore functions relating to pick-up or local delivery of export/import courier packages/ shipments and housekeeping activities are not necessarily required to be performed by an Authorized Courier and the same can be outsourced. He claims that outsourcing of such activit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sued a show cause notice cum suspension order dated 18.02.2016 calling upon the petitioner to show cause as to why his courier license not be cancelled. By the same order, the petitioner s courier license was also suspended. The petitioner states that the said Show cause notice cum suspension order was received on 22.02.2016, as it was dispatched on 20.02.2016. 11. On receipt of the aforesaid Show cause notice, the petitioner filed a representation dated 02.03.2016 before respondent no.2. The petitioner was afforded a personal hearing on 14.03.2016. Thereafter, the petitioner filed a writ petition being W.P.(C) 3485/2016 captioned M/s. Future Express and Anr. V. Union of India and Ors. challenging the Show cause notice cum suspension order. 12. While proceedings were pending before this Court, the Inquiry Officer appointed by the respondents concluded the inquiry and passed an order dated 17.05.2016 concluding that the petitioner does not fulfill the attributes on an Authorized Courier. The said report was communicated to the petitioner on 14.06.2016. 13. Respondent no.2 also concluded the proceedings initiated pursuant to the Show cause notice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... outsource part of the functions to Budget. However, it received no response to the said application. He contended that the same was not necessary as the respondents had by a subsequent Circular (Circular No. 59 of 2016 Customs dated 02.12.2016), recognized that no permission was required to outsource non-core activities. He contended that in terms of the said notification, the petitioner was only required to submit prior intimation for outsourcing the non-core functions of pick-up, local delivery and housekeeping activities. 18. He submitted that in view of the aforesaid notification, the order rejecting the petitioner s license and the impugned order, could not be sustained. Reasons and Discussion 19. The Central Board of Excise and Custom (CBEC) has framed the 1998 Regulations for assessment and clearance of goods by Authorized Couriers. Subsequently, CBEC also framed the 2010 Regulations for enabling electronic filing and processing of customs declaration with regard to import and export consignments carried by courier companies. Consequential changes were also made in the 1998 Regulations, which regulates the procedure for clearance of courier c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sistant Commissioner of Customs or Deputy Commissioner or Customs. (c) exercise due diligence to ascertain the correctness and completeness of any information which he submits to the proper officer with reference to any work related to the clearance of import goods or of export goods; (d) not withhold information communicated to him by an officer of customs, relating to assessment and clearance of import goods as well as inspection, examination and Clearance of export goods, from a client who is entitled to such information; (e) not withhold any information relating to assessment and clearance of imported goods or of export goods, from the Assessing Officer; (f) not attempt to influence the conduct of any officer of Customs in any mater pending before such officer of his subordinates by the use of threat, false accusation, duress of offer of any special inducement or promise of advantage or by this bestowing of any gift or favour or other thing or value; (g) maintain records and accounts in such form and manner as may be directed from time to time by an Assistant Commissioner of Customs or Deputy Commissioner or Customs and sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs, whichever is earlier. (ii) file electronic declarations, for clearance of imported or export goods, through a person who has passed the examination referred to in regulation 8 or regulation 19 of the Customs House Agents Licensing Regulations, 2004 and who are duly authorised under section 146 of the Act; Provided that a transition period upto 31st December, 2011 shall be allowed to the Authorised Courier for fulfillment of the obligation in so far as it relates to examination referred to in regulation 8 of the Customs House Agents Licensing Regulations, 2004. (iii) advise his consignor or consignee to comply with the provisions of the Act, rules and regulations made thereunder and in case of non-compliance thereof, he shall bring the matter to the notice of the Assistant Commissioner of Customs or Deputy Commissioner of Customs; (iv) verify the antecedent, correctness of Importer Exporter Code (IEC) Number, identity of his client and the functioning of his client in the declared address by using reliable, independent, authentic documents, data or information; (v) exercise due diligence to ascertain the correctness and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd security check at Customer location in overseas location managed by Overseas Partner i.e. Fardar Express / AJ Worldwide etc. 2. Bagging / Manifesting Export of Consolidated courier Meterial in overseas locations- Managed by overseas partner i.e. Fardar Express / AJ Worldwide etc. 3. Import receiving / clearance at EICI Terminal IGI; Delhi Managed by Future Express 4. The consignment is then handed over to Budget Courier Pvt. Ltd. by Future Express with compete documentation of hand over. 5. Pincode wise segregation of deliveries at warehouse managed by Budget Courier Pvt. Ltd. 6. Final Delivery to Receivers location in NCT- Managed by Budget Courier Pvt. Ltd. 1. Final Delivery to receiver location of Rest of India Managed by Budget Courier Pvt. Ltd. 26. In addition to the above, the petitioner had also set out its obligations and that of Budget under the MoU, in his submissions. The same is set out in the order dated 27.01.2017 and is reproduced below:- Responsibility (Operational Financial) of Each Compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that of a courier agency but merely of a service provider engaged in the activity of custom clearance. The activity of a courier includes that of delivery of goods / shipments to customers, and clearance of customs is only an incidental part of the said business. In the present case, the principal business of the petitioner is assistance in custom clearance and not of collection and delivery of goods on a door to door basis. 29. At this stage, it is also relevant to refer to paragraph 4 of the Circular No. 33/2010 dated 07.09.2010, which explains the rationale for granting license to Authorized Couriers. Sub-paragraph (i) of Paragraph 4 of the said Circular is relevant and is set out below:- 4. Apart from the changes as outlined at Para 2 above, some additional changes have been brought in the Regulations for the manual mode: (i) On the lines of similar requirement for Customs Cargo Service Providers (CCSP) under the Handling of Cargo in Customs Areas Regulations, 2009, a provision has been made prescribing the requirement of prior permission of customs if the Authorised Courier wants to sublet/outsource any of the components in the door-to-door suppl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner that he was not required to obtain permission as contemplated under Regulation 13(j) of the 1998 Regulations in view of the Circular dated 02.12.2016. At this stage, it would be necessary to refer to paragraphs 4 and 5 of the said Circular (Circular No. 59 of 2016 - Customs dated 02.12.2016) which are set out below:- 4. An authorised courier performs varieties of activities during the process of assessment and clearance of the goods followed by delivery at the door. Some of these are core activities and critical to his role as an authorised courier whereas some are non-core activities. Like other sectors, it is understandable that an authorised courier would like to outsource some its non-core activities without the rigour of obtaining permission each time. 5. In view of this, Board is of the view that relaxation from such permission merits consideration with regard to certain components of the supply chain before entry inwards/after clearance of the imported courier shipments and before carting in/after 'Let Export' of the export shipments. Accordingly, Board has decided that for functions namely pick-up or local delivery of export/imp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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