2024 (1) TMI 347 - AT - Customs

Levy of penalty under Regulation 22 and 23 of Customs Broker Licensing Regulations (CBLR) 2013 - prohibition on Customs Broker from working in the jurisdictional area of the Cochin Customs Commissionerate till the completion of the adjudication proceedings against the Customs Broker which is pending at Mumbai - HELD THAT - From the records it is seen that the Customs Broker was issued with two show cause notices one for availment of fraudulent drawback claims by the Commissioner of central Excise Coimbatore and the second SCN by the Commissioner of Customs Cochin for obtaining documents from the government records without authorization of the proper officer. It seen that these two notices are completely on different grounds issued by different Commissionerate for the offence committed by two different employees of the appellant. In the first show cause it was found that Shri Murthy one of the employees of the appellant had obtained signatures of the authorized representatives of the exporter on blank shipping bills and the same were used for claiming fraudulent drawback. This fact was admitted before the enquiry officer and based on the enquiry report the matter was adjudicated - The impugned order which deals with the second show cause notice issued by the Commissioner of Customs Cochin is entirely of different grounds which involves another employee Shri Pradeep Nangia of the same appellant. In this case the employee had taken a copy of unsigned letter of the Deputy Commissioner without proper authorization thus violating the Sub-clauses 11(h) and 11(i) of the Regulations. Since the proceedings are on entirely different grounds the Final order issued by the Mumbai Commissionerate will have no bearing in as much as the penalty is concerned. Moreover the notices are on different employees of the same customs broker and the offences committed vary and commission of offence is at Coimbatore and Cochin the orders issued by the Commissioner Mumbai cannot completely exonerate the appellant from penalty. However as per the impugned order the suspension of license in the jurisdiction of Cochin was only till the date of adjudication proceedings by Mumbai and the adjudications proceedings having finalized the suspension within the jurisdiction of Cochin Commissionerate is set aside taking into consideration the fact the license has been extended upto 2027. Appeal allowed in part.

Summary

Issues Involved:
The issues involved in the judgment are the imposition of a penalty under Customs Broker Licensing Regulations (CBLR), 2013, the renewal of a license, fraudulent drawback claims, unauthorized procurement of documents, and the reduction of penalty amount.

Imposition of Penalty under CBLR, 2013:
The appeal was filed against an order imposing a penalty of Rs.50,000/- under Regulation 22 and 23 of CBLR, 2013. The appellant submitted that proceedings at the parent Commissionerate Mumbai were concluded, and a penalty was imposed under Regulation 18 of CBLR 2018. The appellant's license was renewed for a further period, and it was argued that the two show cause notices were issued by different Commissionerates for offenses committed by different employees. The Order-in-Original by the Mumbai Commissionerate did not revoke the license of the Customs Broker. The Tribunal considered the different grounds of the show cause notices and reduced the penalty to Rs.25,000/-, partially allowing the appeal.

Fraudulent Drawback Claims:
One employee of the appellant obtained signatures of authorized representatives on blank shipping bills for claiming fraudulent drawback. The Commissioner found that the act was in the course of employment and not entirely personal. The lack of stringent supervision and control on employees made the Customs Broker accountable for the liability. The Commissioner did not revoke the license but imposed a penalty for failing to discharge duties under the regulations.

Unauthorized Procurement of Documents:
Another employee of the same appellant obtained a copy of an unsigned letter without proper authorization. The appellant claimed no knowledge of the unauthorized act and took immediate action against the employee. The appellant requested leniency, stating that appropriate action was taken promptly. The Tribunal considered this separate offense and reduced the penalty due to the actions taken by the appellant against the erring employee.

Renewal of License and Reduction of Penalty:
The Tribunal noted that the Final order issued by the Mumbai Commissionerate would not affect the penalty in the current proceedings. Since the offenses were committed by different employees in different locations, the penalties were considered separately. The suspension of the license in the jurisdiction of Cochin was set aside considering the extension of the license up to 2027. The penalty was reduced to Rs.25,000/- based on the circumstances discussed, and the appeal was partially allowed.