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Krishna Brothers Versus Commissioner of Customs, Cochin

2016 (9) TMI 1093 - CESTAT BANGALORE

Revocation of CHA licence - forfeiture of security deposit - regulation no. 19(1) of the CBLR 2013 - imposition of penalty - Held that: - It is the responsibility of the CB to question the importer or exporter regarding the legal provisions and procedures. Also it is their duty to invite attention of the Department if they come across any fraud or duty evasion, any import or export related activity in stead of certifying as a trustful intermediate between department and trade, but facilitate the .....

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/ 2016 - Dated:- 15-9-2016 - Shri S.S Garg, Judicial Member And Shri Ashok K. Arya, Technical Member Shri Reghunatha Karnavar, Consultant For the Appellant Shri N. Jagdish, AR For the Respondent ORDER Per S. S. Garg 1.1. The present appeal is directed against the impugned Order-in-Original dated 21.04.2015 passed by the Commissioner of Customs vide which the appellant s license as Custom Broker was revoked and whole of the security deposit was forfeited. Briefly the facts of the present case are .....

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ppuram and certain other importers. Preliminary investigation revealed that the Bills of Entry under investigation were filed by the appellant firm while the clearance of goods imported/under import were handled by one Shri N.S. Mahesh, who did not have any proper authority or Customs ID Card in the name of the appellant firm. Investigation conducted indicated that Shri N.S. Mahesh with the connivance of the importers and the overseas suppliers had fabricated the import documents which resulted .....

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ued vide order COC-CusTM-000-COM-026-14-15 dated 10.09.2014 after obtaining submissions from the appellant. 1.5. Show cause notice No. F. No. S9/30/1964 I&B Cus dated 13.10.2014 was issued to the appellant under CBLR 2013 by the Commissioner of Customs answerable to the Deputy Commissioner of Customs who has been appointed as the Inquiry officer in terms of the CBLR 2013 as to why - (a) the Customs Brokers license No. 20 of M/s. Krishna Brothers should not be revoked under Regulation 18 of C .....

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pellant vide submission dated 05.03.2015 before CC, Cochin denying charges against the appellant. The learned Commissioner, Customs after considering the enquiry report, written submissions of the appellant filed on 05.03.2015 and after affording appropriate opportunity of hearing to the appellant and analyzing the facts and material brought on record, came to the hold that CB had intentionally violated the provisions of Regulations 11(a), (b), (K) and (n) of CBLR 2013 and consequently imposed t .....

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l. The learned counsel further submitted that the learned Commissioner without considering the totality of the evidences and circumstances wrongly concurred with the findings of the enquiry officer regarding the allegations contained in para 11 of the show-cause notice that the appellant had violated Regulation 11(a) of the CBLR 2013 inasmuch as the appellant failed to obtain authorization from the importer before undertaking to perform customs related work for them. He also submitted that these .....

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at one Mahesh gained entry in the port area and operated there solely because of the entry pass applied by M/s Krishna Brothers was denied as baseless and unsustainable by the appellant. To controvert this allegation the learned Commissioner on the basis of enquiry report has observed that from the record, it is proved that CB themselves had applied to M/s. Cochin Port Trust on 01.01.2013 for renewal of Bio Metric Wharf Entry Pass of Shri N.S. Mahesh and in the said application Shri Ganapathy Iy .....

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his case detailed enquiry was conducted by the Deputy Commissioner. The statements of Shri P. Ganapathy, O Kassim and N.S. Mahesh were recorded during the investigation under Section 108 of the Customs Act 1962. The learned AR took us through the statements of these persons and he also referred to the enquiry report of the Deputy Commissioner where the Deputy Commissioner after a detailed enquiry has come to the conclusion that the CB has violated regulations 11(a)(d)(k) and (n) of CBLR 2013. In .....

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oss any fraud or duty evasion, any import or export related activity in stead of certifying as a trustful intermediate between department and trade, but facilitate the fraud as well as to safeguard Government s revenue. The CB in this case had violated rules and regulations stipulated in CBLR 2013. From the above, it appears that the nature of offence committed by CB deserves penalty and revocation of the license under Regulation 18 (b) and (c) of CBLR 2013. Further the learned Commissioner in t .....

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se, it is seen that CB allowed Sri Mahesh, who was neither an authorized employee nor a person authorized to transact business with customs on behalf of CB, to take over and discharge all the duties and responsibilities vested on them, for a consideration of ₹ 500/- per document. Sri Mahesh used to bring business to CB in the form of imports, and got the documents filed using the office of CB, who in turn did not exercise due diligence or scrutiny while endorsing all the documents and fili .....

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into trouble; this is a case where the top management of CB, on their own volition, decided to give away all the responsibilities, powers and obligations, which was required to be performed by CB, to a person not employed by them, for a consideration. Hence the case of M/s. Ark Logistics cited by CB would not apply in this case. As this is a procedure under CBLR 2013, the culpability/liability of CB in the evasion of customs duty is not the subject matter to be considered in the present proceed .....

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pose on them the maximum penalty stipulated therein. 4.1. Further we find that the case law relied upon by the appellant does not apply to the facts of this case. The case law mentioned below and relied upon by the AR would apply in the instant case. (i) CC Vs. K.M. Ganatra & Co. 2016-TIOL-13-SC-CUS (ii) Sri Durga Shipping Agencies Vs. CC, Trichy 2013-TIOL-1562-CESTAT-MAD (iii) Jai International Vs. CC, Mumbai 2011-TIOL-943-CESTAT-MUM (iv) CCE, Hyderabad-II Vs. H B Cargo Services, Hyderabad .....

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rror in interfering with the decision of a domestic authority. In a departmental proceeding one has to see whether the principles of natural justice are followed and the findings are justified from material on record. Once both these aspects are satisfied if an outsider Tribunal interferes, its findings and order will be improper and perverse which is what has happened in the present case. Similarly when one comes to the disciplinary measures, one must not lose sight of the fact that the appella .....

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e circumstances, we allow Customs Appeal No. 37 of 2006 filed by the appellant-Commissioner of Customs since the CESTAT was not justified in setting aside the revocation of the CHA licence in the facts and circumstances of the case and on the material on record. The order of the CESTAT setting aside the order of the appellant-Commissioner of Customs was clearly perverse in law. Appeal No. 37 of 2006 is, therefore, allowed. The order dated 4-4-2006 passed by the CESTAT is set aside and the order .....

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