2024 (6) TMI 1120 - AT - Customs

Levy of penalty on the appellant in terms of regulation 18 of Customs Brokers Licensing Regulation 2013 - aiding and abetting on the part of the appellant in mis-classification of the goods rendering the same liable for confiscation under section 111 (m) of the Customs Act 1962 - HELD THAT - It is noted that no case of imposition of penalty subsists in the matter as there is nothing to impute any misdemeanour commission or omission of an act clearly attributable on part of the appellant attributable to them as their role and responsibilities of a customs broker. It is duly recorded by the Commissioner that the customs broker had requested for second appraisement of the subject bills of entry by way of examination of the goods. While the department choose to enhance the value of the imported goods no change to the classification of the goods under import was carried out. Under the circumstances it is most improper to allude any misdemeanor on the part of the customs broker or to hold them responsible for any misdeclaration when they have themselves solicited first check examination of import cargo. The order records that the custom broker had also called for the previous Bills of Entry of subject imports from the importer in order to substantiate their case for filing of the classification of the imported goods described as Spruce Rough Sawn . The Commissioner has also noted that the importer had diligently carried out his responsibilities and also undertaken address and IEC verification of the importer. In fact it is noted in the order that the Customs Broker had sent his employee to the office of the importer for purpose of verification. It is found most improper and unwarranted on the part of the department to impose a penalty of Rs.50, 000/- on the appellant - there is no case for invocation and imposing of penalty on the appellant in the present case - the Order-in-Original passed by the adjudicating authority is set aside - appeal allowed.

Summary

Issues:
- Appeal against penalty imposed on customs broker under Customs Brokers Licensing Regulation 2013.
- Allegations of aiding and abetting in misclassification of goods.
- Prohibition order on customs broker's license.
- Imposition of penalty and appeal against the same.

Analysis:
1. The appellant, a customs broker, challenged a penalty of Rs.50,000 imposed by the Ld. Commissioner of Customs under the Customs Brokers Licensing Regulation 2013 (CBLR, 2013). The penalty was based on allegations of aiding and abetting in misclassification of goods, leading to a show cause notice from DRI Mumbai and subsequent prohibition of the customs broker's license.

2. The appellant contended that they had acted diligently by requesting previous bills of entry from the importer and seeking a second appraisement for the subject Bills of Entry. Despite the Customs Authorities increasing the value of the goods, the classification remained unchanged. The appellant also verified the importer's address and IEC code, demonstrating efforts to ensure compliance.

3. The adjudicating authority imposed the penalty after due process, citing Regulation 18 of the CBLR, 2013. However, the appellant challenged this decision, arguing that the revocation of their license was unwarranted. The CESTAT Mumbai had previously revoked the prohibition order, directing a fresh consideration of the case.

4. During the hearing, the Ld. Commissioner of Customs acknowledged the appellant's actions, such as requesting a second appraisement and verifying the importer's details. The Commissioner found no grounds to attribute any wrongdoing to the appellant and noted their efforts to comply with regulations. Consequently, the Tribunal set aside the Order-in-Original, stating that there was no basis for imposing the penalty of Rs.50,000.

5. The Tribunal concluded that the appellant had fulfilled their responsibilities as a customs broker and had taken necessary steps to ensure compliance. Therefore, the penalty was deemed improper and unwarranted. The appeal was allowed, and any consequential relief was granted as per the law. The decision was pronounced in the open court on 25.06.2024.