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M/s. Cargo Concept (Bombay) Pvt Ltd. Versus Commissioner of Customs (Gen) , Mumbai

2016 (9) TMI 927 - CESTAT MUMBAI

Restoration of CHA license revoked - forefeiture of security deposit - regulation 22(7) and 20(1) of then CHLR 2004( now Regulations 20(7) and 18 of CBLR, 2013) - drawback - mis-declaration - classification - Customs Tariff Item No. 6109.9090 - drawback @ 7.8% of the FOB value - Customs Tariff item No. 6109.1000 - drawback @ 6.7% of the FOB value - Held that: - Appellant, being CHA, acted as a CHA of the exporter on the basis of documents submitted to him. As per the document, description declar .....

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mis-decaration. - Authorisation letter - Held that: - once the exporter gave the authority letter and thereafter the business is continuing, the same authority letter will be sufficient for carrying out the business in future also. Therefore, in each and every consignment, or each and every shipping bill separate authorization is not required. Once the authorization was given by the exporter it is sufficient compliance of regulation 13(a) of CHARL, 2004. when the shipping bill was filed by t .....

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lead to any conclusion that there was no relation between appellant and exporter. - Advise to client - Held that: - Even after detection of different nature of the goods, the description of the goods remained same. Therefore there was no occasion for CHA to advise client. - Performance of CHA - delay and deficiency - Regulation 13(n) - Held that: - the appellant have performed their clearance work of export consignment in usual course and nothing brought on record that appellant as CHA .....

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Admin) dated 27/3/3015 passed by the Commissioner of Customs (General), Mumbai-I, by which Ld. Commissioner ordered revocation of CHA License of M/s. Cargo Concepts (Bombay) Pvt Ltd and also ordered forfeiture of entire amount of security deposit of the appellant under provisions of regulation 22(7) and 20(1) of then CHLR 2004( now Regulations 20(7) and 18 of CBLR, 2013). 2. The fact of the case is that as per the intelligence received by the DRI, it was found that M/s. Cosmos Enterprises having .....

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covered under five shipping bills Nos. 463726, 4693727, 4693728, 4693732 and 4693732 all dated 23/10/2006 with declared value of ₹ 87,64,800/- and drawback involved ₹ 6,83,654/- filed in the name of M/s. Cosmos Enterprises had been stuffed in the said container. The description of the goods covered under all the above five shipping bills was given as Readymade Garments-Gents T Shirts, the declared price was USD 6.40 per pc and Drawback per piece was claimed @ 7.8 % of the FOB value .....

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oods were actually found to be made of 100% cotton and hence correctly classifiable under Customs Tariff item No. 6109.1000 whereas garments made of cotton fabric were classifiable under drawback tariff items No. 6109.01 which is eligible for drawback @ 6.7% of the FOB value as per the Table of drawback rates 2006-07, thus it appeared that M/s. Cosmos Enterprises had mis-declared their goods as garment made of manmade fibers in order to avail higher drawback, though the same were actually garmen .....

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ration department of the said CHA firm. In his statement, he stated that they had handled the custom clearance of the export shipments of M/s. Cosmos Enterprises, Kutch and further stated that they had received the said client through one Mr. Satyajit Sinha, Marketing Executive of M/s. Almighty International Logistics (I) Ltd (shipping firm); that they had handled the customs clearance of the export consignments of M/s. Cosmos Enterprises on 13/10/2006 and 23/10/2006; that they had attended to s .....

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in respect of handling of Customs clearance of their goods. Report on misuse of drawback scheme was communicated by the DRI officers vide show cause notice dated 23/10/2008 and the same was received in the office of commissioner on 11/11/2008. In view of the above inquiry, proceedings against appellant, invoking of provisions of regulations 20(2) of CHALR, 2004 was initiated. License of the appellant was placed under suspension vide order No. 70/2008 dated 19/11/2008, however suspension was rev .....

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have violated the regulations of 13(a), 13(d) and 13(n) of CHALR, 2004. After considering the submission of the CHA and submissions made in the personal hearing, Ld. Commissioner has passed an order for revocation of the license. Extract of the Commissioners findings on all the regulation is under: (a) In respect of regulation 13(a) of CHALR 2004 it was held that authority letter submitted by the appellant is in respect of earlier 8 consignments cleared by the CB and not for the consignment co .....

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never presented before any authority thus Shri Dongre also admitted in his statement that they received client through middle man and not directly from the exporters therefore Ld. Commissioner held that appellant has violated the provision of regulation 13(a) of CHALR, 2004. (b) As regard the violation of regulation 13(d) of CHALR, 2004, Ld. Commissioner contended that it is accepted fact that appellant have not met exporter. It is obligatory on the part of the CHA to direct their client to comp .....

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nt. CHA has blindly accepted documents and not advised their client therefore the CHA violated Regulation 13(d) of CHALR, 2004. (c) Ld. Commissioner as regard the 13(n) contended that since CHA did not possess authority letter, acceptance of clearance work through unauthorized person indicates that the lapses of CHA in carrying out clearance work properly, hence CHA has failed in efficiently discharging of their obligation as Custom House Agent. Therefore they are culpable for violation of regul .....

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e regulations were violated. He submits that appellant indeed submitted the authorization letter, it was discarded by the Ld. Commissioner on the basis that signature is not tallying with some other documents, however it was not proved that authorization letter is not genuine. Secondly much emphasis was given to the statement of Shri. T. Dongre, wherein he stated that they did not possess authorization letter. He submits that genesis of the case is the allegation of mis-declaration of classifica .....

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made of 100% cotton and not other than 100% cotton. This being highly technical aspect, cannot be expected from CHA to know about characteristic of the product. It is general practice that CHA carries out his job mainly on the basis of documents produced before him and if he finds any apparent mistake in the documents, he suppose to point out otherwise it is not possible for CHA to check content of consignment. He submits that the whole case was decided only on the basis of Shri. T. Dongre s st .....

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cuments submitted by the exporters, it is obligatory on the part of the CHA to advise their client. But in the present case there was no apparent discrepancy either in the goods or in the documents therefore contention of the Ld. Commissioner that appellant have not advised their client does not stand. He further submits that it is fact on record that appellant was paid only ₹ 500/- per documents which is very reasonable as CHA charges, even this proved that appellant are nowhere concerned .....

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his proved that appellant had no role in the exporters attempt to avail higher and undue drawback by exporting impugned goods. In the said order it was established that CHA had no prior knowledge therefore penalty was dropped. As regard the Ld. Commissioner s findings that appellant violated the provisions of regulation 13(n), he submits that the said the charge of violation of said regulation does not sustain for the reason that there is no dispute that the present appellant has acted as CHA in .....

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2014(308)ELT 103(Tri. Mumbai)] (d) Commissioner of Customs( General), Natraj Shipping Agency[2016(332) ELT 237(Bom.)] (e) Dakor Clearing & Shipping P ltd Vs. Commr. Of Cus. (General). Mumbai[2015(326) ELT 178(Tri. Mumbai)] (f) K.S. Sawant & Co. Vs. Commissioner of Customs (General), Mumbai[2012(284) ELT 363)Tri Mumbai] (g) Maruti Transports Vs. Commissioner of Customs, Chennai[2004(177) ELT 1051(Tri. Chennai)] (h) Peak Agencies Vs. Commr. Of Cus., (General), Mumbai[2015(327) ELT 572(Tri. .....

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t is responsible for illegal act and the Ld. Commissioner rightly revoked the license. In support of his submission, he placed reliance on following judgments: (a) Commissioner of Customs Vs. M/s. K M Ganatra & Co [2016-TIOL-13-SC-CUS] (b) P.B. Nair C& F Pvt Ltd Vs. Commissioner of Customs(General) Mumbai[2015(318) ELT 437(Tri. Mumbai)] (c) Delta Logistics Vs. Commissioner of Central Excise, NCH, Mumbai [2014(309)ELT 171(Tri. Mumbai)] (d) Noble Agency Vs. Commissioner of Customs, Mumbai[ .....

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the samples were got tested by the customs authority from Textile Committee. This itself shows that anybody from eye estimation cannot know, even custom authority could not know that the garment is made of 100% cotton or otherwise. Appellant being CHA acted as a CHA of the exporter on the basis of documents submitted to him. As per the document description declared was not incorrect i.e. readymade garment /T shirt therefore we do not see any involvement of the appellant and even there was no re .....

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ere paid ₹ 500/- per document for their clearance in respect of exports of the impugned goods, there is nothing on record to show that the appellant have benefited extraneously over and above the actual CHA fees i.e. ₹ 500/- per document. In view of this position there is no doubt that appellant CHA was nowhere involved in any mis-declaration of the goods made by the exporter. As regard the authorization letter, we find that the said charge was made by the Commissioner only on the ba .....

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ficient for carrying out the business in future also therefore we do not see that in each and every consignment or each and every shipping bill separate authorization is required. Once the authorization was given by the exporter it is sufficient compliance of regulation 13(a) of CHARL, 2004. As regard the allegation by the Ld. Commissioner that signature on the authority letter was not tallying. We find that the Ld. Commissioner has not made any efforts to investigate in the matter of signature .....

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e work of exports consignments. As regard the violation of the regulation 13(d) and (n), we find that Ld. Commissioner held that there is violation under regulation 13(d), contending that appellant was given CHA work not directly by the exporter but through one shipping line, therefore appellant have never met to the exporter, accordingly appellant have not advised the exporter. In this regard, we find that this is general practice in the CHA business that CHA work is brought by the various inte .....

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