A1 Cuisines Private Limited Versus Union of India, And State of Maharashtra,
GST
2018 (12) TMI 1278 – BOMBAY HIGH COURT – 2019 (22) G. S. T. L. 326 (Bom.)
BOMBAY HIGH COURT – HC
Dated:- 28-11-2018
Writ Petition No. 8034 Of 2018
GST
P. N. Deshmukh And Mrs. Swapna Joshi, JJ.
Mr. S. Kantawala, Advocate with Mr. A.M.Sudame, Advocate for Petitioner.
Mr. S.A.Chaudhari, Advocate Mr. A.D.Sonak, A.G.P. for Respondent.
ORAL JUDGMENT
P. N. Deshmukh,
1. Present petition is filed by the petitioner seeking issuance of Writ of Mandamus directing the respondents to exempt the petitioner from charging applicable taxes under the GST Legislations on sale of cosmetic products, perfumes etc. to the International passengers and claim refund of any input tax paid on input supplies and input services from the retail shop which the petitioner intends to set up at the Domestic Security Hold Area at Dr.Babasaheb Ambedkar International Airport (hereinafter re
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
after purchasing these products from the shop, will be able to depart from India after taking connecting International flight from the transit International Airport. It is further submitted that a duty free operator operating in India imports goods like liquor, tobacco products, souvenirs, eyewear, watches, fashion, chocolates, perfumes etc. by filing import general manifest and Bill of Entry for warehousing with the Customs department without payment of import duty on the first importation subject to certain conditions. The Bill of Entry clearly indicates the duty free operator as an “importer”. The imported goods are warehoused at a bonded warehouse. Further the Bill of Entry also discloses that the goods imported are for “sale only for Duty free shop/export.”
Similarly, it is also submitted that the duty free operator also takes on rent a private bonded warehouse located near the Airport as well as certain shops called 'dutyfree shops' at the arrival and departure terminals
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
69) or for removal to another warehouse or otherwise provided in this Act. The petitioner submits that the goods so warehoused are then brought to the dutyfree shop without payment of duty under escort of the bond Officer. The goods are then sold at the duty free shops at arrival and departure terminals. The subsequent sales at duty free shops are under general supervision and control of the Customs Officer and that the goods are sold at the duty free shops to the International passengers at the arrival and departure terminals by issuing a sales invoice which disclose inter alia the name of the passenger, flight details, passport number, etc. and is available for inspection by the Customs Officer. These details are also entered in the computer of the operators and are available for inspection by the Customs Authority.
4. The petitioner submits that with effect from July, 2017, the respondent no.1 promulgated and notified CGST, IGST and various State Governments promulgated SGST. That
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
proposed to be operated by petitioner and had sought further direction that petitioner shall be eligible to claim refund of any taxes paid on any supplies and input services from his shop in the event his tender for having such shop at Nagpur Airport is granted to him.
6. In the context of above facts, petitioner relied on the case of M/s. Hotel Ashoka (Indian Tourism Development Corporation Limited) vs. Assistant Commissioner of Commercial Taxes and Another (Civil Appeal No.2560 of 2010) reported in 2012 (276) ELT 433 (SC) and on the order of Excise and Service Tax Appellate Tribunal West Zonal Bench, Mumbai in the matter of Commissioner, Service TaxVII vs. Flemingo Duty Free Shop Pvt. Ltd. (Appeal No.8723441/ 2016), dated 28.09.2017, wherein law laid down in the case of Hotel Ashoka (supra) is relied and Central Government's order dt.31.8.2018 bearing No.634/2018CUS( WZ)/ASRA/MUMBAI passed under Section 129DD of the Customs Act, 1962 in the case of Aarish Altaf Tinwala.
7. To
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
om India after embarking the International flight from the transit International Airport.
8. We have carefully considered the submissions of the petitioner in the instant petition and have perused the provisions of Article 286 of the Constitution of India, GST laws, Customs Act, 1962 and Finance Act, 1994. We have considered the Judgment of the Hon'ble Supreme Court in the case of Hotel Ashoka (supra). We have also perused the two Orders of the CESTAT and of the Central Government following the case of Hotel Ashoka, which are relied upon by the petitioner.
9. The Government of India in case of Aarish Altaf Tinwala by its order dt.31.8.2018 dismissed the revision of applicant filed by International passenger on relying the case of M/s. Hotel Ashoka (cited supra) observing that :
“8. The applicant has vehemently pleaded that once he has completed the immigration formalities, he is said to have entered Indian Territory. Thereafter, the goods purchased from the duty free shop situa
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
waters of India. ”
11. The Central Government however observes that the duty free shops though being physically located in Indian Territory, are specifically treated as being located outside the Customs Territory of India. duty free shops are located in the Customs Area defined under Section 2(11) and it includes any area where the imported goods or export goods are kept before clearance by Customs authorities. Goods sold by duty free shops are not duty paid goods and such goods are deposited in a customs bonded premises/ware houses, licensed under Section 58A of the Customs Act, 1962 without payment of duty. Section 71 clearly mandates that no goods shall be taken out of a warehouse except clearance for home consumption, exportation or removal to another warehouse or as otherwise provided by this Act. It is thus clear that such goods need to suffer Customs duty on being exported by duty free shops and imported by passenger in terms of Section 77 of the Customs Act, 1962. The conten
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
id that the said goods had crossed the customs frontiers.
The goods are not cleared from the customs till they are brought in India by crossing the customs frontiers. When the goods are lying in the bonded warehouses, they are deemed to have been kept outside the customs frontiers of the country and as stated by the learned senior counsel appearing for the appellant, the appellant was selling the goods from the duty free shops owned by it at Bengaluru International Airport before the said goods had crossed the customs frontiers. ”
“30. They again submitted that 'in the course of import' means 'the transaction ought to have taken place beyond the territories of India and not within the geographical territory of India.' We do not agree with the said submission. When any transaction takes place outside the customs frontiers of India, the transaction would be said to have taken place outside India. Though the transaction might take place within India but technically loo
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
tiers of India. Although, the applicant bought goods from duty free shop at CSI Airport Mumbai, the same are deemed to be imported from across the Customs Frontiers of India and customs duty is payable on such goods. Since the applicant crossed the green channel without declarations and without payment of customs duty, the department has rightly proceeded against the Applicant.
11. The Central Government has thus applied the ratio laid down by Hon'ble Supreme Court in Hotel Ashoka (supra) and correctly held that the transactions effected at the duty free shops at the arrival or departure of the International Airports in India located after the passenger clears immigration might have taken place within the geographic territory of India, but for the purposes of levy of Customs Duties or any other taxes, the area of duty free shops shall be deemed to be the area beyond the customs frontiers of India and the transaction would be said to have taken place outside India.
12. The aforesa
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
chase/supplies of goods or services to or from duty free shop situated after the passenger crosses the immigration counter at arrival or departure hall of International Airport Terminals; however, they would have no application to shops located at a domestic Airport or Domestic Security Hold Area, which are before even the immigration clearance by a passenger, where the transaction cannot be said to have taken place in any area beyond the customs frontiers of India or outside India. Even otherwise, a passenger travelling on a domestic flight from Nagpur may or may not travel abroad, and the Customs Authorities would not be able to have effective check and control to verify whether the goods purchased from Domestic Airport at Nagpur are actually taken abroad by the passenger.
14. We are thus unable to agree with the petitioner and find no merit in this petition. No case is made out even on prima facie basis to issue any directions or any notice in that regard. With the above observatio
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =