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2018 (11) TMI 501 - AT - CustomsPenalty on CHA u/s 114AA of Customs Act, 1962 - it was alleged that appellant was involved in the case of overvaluation of imported goods - It was also alleged that the CHA/Director failed to verify the KYC norms under the CHALR, 2004 - scope of SCN - Held that:- The SCN has been issued under Section 110(2) of the Act and not under the Section 124 of the Customs Act - Section 110(2) of the Act deals with extension of time period for issuance of show cause notice within prescribed period of six months of the seizure of the goods. It is obvious from the show cause notice that the same has not invoked the provisions of Section 124 of Customs Act in this case - the another show cause notice has been issued by the DRI dated 7.7.2014 (supra) read with Addendum dated 10.7.2014 and the Commissioner (I&G), New Customs House has extended the time limit for issue of show cause notice under Section 124 of the Customs Act in respect of detained goods vide Bill of Entry No. 4314276 dated 10.1.2014 by six months i.e. up to 29.1.2019 under the provisions of sub-section (2) of Section 110 of the Customs Act. The present show cause notice is issued in continuation to the earlier show cause notice issued by the DRI where the provisions of Section 124 of the Act has been invoked. The appellant has not provided the copies of these orders before us so as to arrive at the conclusion as to whether the impugned show cause notice and adjudication order is the extension of the previous show cause notices along with addendum which has been clearly spelt out with adjudicating authority - the present show cause notice in effect has to be treated as having been issued under Section 124 of the Customs Act in effect has to be treated as proviso under 110(2) of the Act. Compliance with KYC norms - Held that:- CHA helps not properly verified the functioning of the client from at the declared address by using reliable independent and authenticate documents. This was a serious lapse on part of the CHA in verifying the KYC before taking up the Custom clearance of consignment of rough diamond imported by M/s Neotex Exim Pvt. Ltd. - The appellants, considering the nature of the imported goods i.e. rough diamond, would have exercised more vigilant approach before taking up the consignment for Customs clearance after verification of KYC norms of the importer, which has not been done in this case. Impugned order upheld - appeal dismissed - decided against appellant.
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