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M/s Millenium Express Cargo Pvt. Ltd. Versus CC, New Delhi

2016 (3) TMI 254 - CESTAT NEW DELHI

Contravention of provisions of Regulation 13(e) and 13(o) of CHA Licensing Regulation, 2004. - Impart of wrong information - Held that: there was no question of the appellant being in a position to impart any wrong information to the client as the same was found non-existent. Also the weight of the container for which it filed bill of entry was in excess by 7.280 tonnes over the declared weight (5.051 tonnes) which should have come to the appellant’s notice at the time of due diligence exercised .....

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not even claimed that it had ever verified the existence of the importer at the given address which means the appellant has failed to fulfil the requirement of Regulation 13(o) ibid. - Violation of Regulation 22 of CHALR, 2004 - Held that: the appellant had not taken the point of time bar before the High Court and therefore by the doctrine of constructive res judicata is prevented from raising this point in respect of the current proceedings which are in compliance of the direction of the H .....

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ppellant was revoked and security deposit of ₹ 50,000/- forfeited. 2. The facts of the case are as under : Intelligence was received that two containers bearing Nos. OOLU 8433339 and TGHU 9546915 contained cigarettes whereas the goods declared were induction cookers. Examination of container No. TGHU 9546915 resulted in recovery of 48 lakhs sticks of cigarettes which were concealed amongst 420 cartons of induction cookers. Container No. OOLU 8433339 was already cleared under Bill of Entry .....

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ations also revealed that the appellant had not conducted due diligence required of a custom broker. Accordingly, the impugned order was passed for violation of Regulations 13 (e) and 13 (o) of CHA Licensing Regulation, 2004. 3. The appellant has contended that : (i) The time limits prescribed in the Regulation 22 of CHALR, 2004 have been violated and therefore the proceedings are not sustainable as has been held in the case of A.M. Ahamed & Co. Vs. CC- 2014 (309) ELT 433 (Mad.). (ii) It has .....

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hiana Cargo Services Vs. CC - CUS.AA.24/2012, C.M. APPL. 19694/2012, Falcon Air Cargo & Travel P. Ltd. Vs. CC, New Delhi - 2001 (141) ELT 284 and Trans Shipping Service Vs. CC - 2004 (163) ELT 484 in support of its contentions. 4. The ld. DR, on the other hand, contended that the appellant had not fulfilled the KYC norms and had not conducted proper address verification and therefore was clearly guilty of violation of the Regulation 13(o). It also did not exercise due diligence to ascertain .....

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ides. It is an admitted fact that the appellant had dealt with the importer M/s Nikhaar Associates. It is also a fact that the importer was found to be non-existent. CHA Regulation 13(e) state that - a CHA shall exercise due diligence to ascertain the correctness of any information which he imparts to a client with reference to any work related to clearance of cargo or baggage . In the present case, there was no question of the appellant being in a position to impart any information to the clien .....

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unctioning of his client at the declared address by using reliable, independent, authentic documents, data or information. CBEC vide Custom Circular No. 9/2008 dated 8.2.2010 in order to avoid any ambiguity inter alia laid down the following requirements of verification and documents for the individual category to which the importer belonged being a proprietorship concern as claimed. S. No. Form of organisation Features to be verified Documents to be obtained 1. Individual (i) Legal name and a .....

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he appellant obtained documents as per column 4 of the above table does not tantamount to fulfilment of requirement of column 3 relating to features to be verified because if that was so, then there was no need to have column 3. As seen from Regulation 13 (o) quoted above, the Custom House Agent is obligated to inter alia verify antecedent, correctness of Importer Exporter Code, identity of the importer and functioning of his client at the declared address by using reliable, independent, authent .....

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erved as under : This court is conscious of the fact that inquiry proceedings under Regulation 22 have got prolonged to an extent. The respondents are directed to complete the enquiry proceeding after giving two opportunities to the appellant in accordance with the provisions of Regulations and other provisions of law and pass final order at the earliest preferably within 3 months from today. The appellant had not taken this point of time bar before the High Court and therefore by the doctrine o .....

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rts to verify the genuineness of the importer and its address. Such acts of omission and commission on the part of CHA can potentially have even more serious financial /security consequences and therefore such a CHA hardly deserves any leniency. We find that in the case of CC (General) Vs. Worldwide Cargo Movers - 2010 (253) ELT 190 (Bom.), the Bombay High Court apart from upholding the principle of liability of the CHA for the act of its employees went on to observe as under : 27. We have noted .....

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nquiry. We are conscious that the punishment has to be commensurate with the misconduct and that by revocation the respondent and its employees are going to suffer. At the same time, we cannot forget that though it is the right of a citizen to carry on his business or profession, it is subject to reasonable restrictions and conditions. In the present case, those conditions were already stipulated. In the case of Arvind Bhagat (supra), the order of Madras High Court has been left undisturbed by t .....

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ther as an importer for undervaluing the imported car. Thus, the employee of the CHA was party to the Firm. The CHA has not disowned him and has, in fact, defended him in the reply filed by him before the appellant. That being so, he is clearly responsible vicariously. (emphasis added). 28. In our view, the Tribunal has committed a grave error in interfering with the decision of a domestic authority. In a departmental proceeding one has to see whether the principles of natural justice are follow .....

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ry for that purpose, the Tribunal is not expected to interfere on the basis of its own notions of the difficulties likely to be faced by the CHA or his employees. The decision is best to be left to the disciplinary authority save in exceptional cases where it is shockingly disproportionate or mala fide. That is not the case here. (emphasis added). The ratios contained in the above reproduced paras (especially in para 28 thereof) is squarely applicable to the present case. Andhra Pradesh High Cou .....

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