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BW Businessworld

Adjudicator Finds No Duty

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According to official sources, the adjudicating authority in the case, Commissioner, Customs Preventive (Delhi), has said that there is no case of duty evasion by GAPL, whose jet worth Rs 112 crore was seized.

The ruling could become a precedent in other such cases involving corporate leaders like the Ambanis and Oberois.

The GAPL case is the first one on which the adjudicating authority had passed its order recently, sources said.

The customs department in the middle of last year had started seizing aircraft of corporate houses imported under the 'Non-Schedule Operator Permit' (NSOP).

It had claimed that some business houses had taken 'advantage' of the duty exemption announced in 2006 on import of aircraft meant for chartered flights even though they (aircraft) were later being used for personal purposes.

While some firms paid the duty demanded by the Customs department, others including GAPL put in the same in the form of bank guarantees and bonds, contending that they had done nothing wrong by pressing the aircraft into use for "Chairman, Directors, guests and relatives of the GMR group of companies" who were being billed for the usage.

When contacted, a senior GMR official said, "We had always said we did nothing wrong. The decision only ratifies our stand." The Preventive Department of the Customs had earlier seized the aircraft saying the group had evaded duty amounting to Rs 27.60 crore by "wilful mis-representation and suppressing of facts for private use of imported aircraft".

As per the NSOP conditions, the aircraft concerned can be used for "only non-scheduled (passenger) services or non scheduled (charter) services".

GMR had gave records of flying records to the department which showed that of the 498.25 hours of flying between August 2007 and May 2008, the Chairman, Directors, and guests and relatives of the GMR Group of Companies accounted for 438.00 hours, and just 60.25 hours were shown as used for charter rpt charter flights

The firm however contended that there were "no non-revenue flights" as every flight is a revenue charter flight, chartered by either the group company or individuals who are billed. It said GAPL used to issue consolidated monthly invoices to group companies for the flights taken, a position that other companies involved in a similar situation have taken, sources said.

The government had raked in over Rs 1,000 crore as bonds and bank guarantees from various operators whose aircraft and helicopters were seized by the Customs.

(PTI)