TMI Blog2021 (12) TMI 350X X X X Extracts X X X X X X X X Extracts X X X X ..... uld have no locus standi - it is found that the balancing the evidence available on both sides, it is found in favour of the Customs Broker and hold that it has not been established that the Customs broker has violated Regulation 10(b) of CBLR, 2018. Regulation 10(d) - HELD THAT:- After the provisional assessment was done which appears to have not been appealed against and hence still valid, DRI intervened and examined the same goods again and came to a different conclusion that the goods were heavily overvalued with a fraudulent intent to claim ineligible drawback. Simply because DRI came to a different conclusion in an export which was already provisionally assessed, it does not mean that the exporter had committed a fraud and that the appellant Customs Broker has colluded with the exporter in such a fraud. At any rate, valuation of the goods is to be done by the exporter (self assessment) or proper officer (re-assessment). there are nothing found remotely in the Customs Act, Rules and Regulations which gives the Customs Broker any power with respect to valuation of imported or export goods - there is no evidence to establish that appellant has violated Regulation 10(d). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0-75801/2021 - Dated:- 7-12-2021 - SHRI P. K.CHOUDHARY, MEMBER (JUDICIAL) AND SHRI P.V.SUBBA RAO, MEMBER (TECHNICAL) Shri A. K. Singh Authorized Representative for the Appellant (s) Shri Arijit Chakraborty, Advocate for the Respondent (s) ORDER These two appeals have been filed by the Revenue and the Customs Broker assailing the same order in original [ Impugned order ] dated 3.3.2021 passed by the Principal Commissioner of Customs (Airport ACC) and hence both appeals are being disposed of together. Appeal no. C 75487/2021 is filed by the Revenue and appeal no. C/75473/2021 is filed by the Customs Broker M/s. MK Saha and Co [ Customs Broker ] . In the impugned order the Principal Commissioner passed the following order in paragraph 32: (i) I, hereby, order for imposing penalty of ₹ 50,000/- (Rupees fifty thousand only) on the CB namely M/S MK Saha and company, 145/A, Ashoke Garh, Kolkata 700108 having license number M 57 Code no. 2405 (PAN ABCFM0925F), by exercising powers conferred upon me under regulation 18 of CBI law, 2018 for violation of Regulations 10 (b), 10 (d), 10 (e) and 10 (n) of CBLR, 2018. (ii) The full amount of security d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lementation of the original order of adjudication a further corrigendum under section 154 of the Customs Act, 1962, is not required. 4. As the corrigendum has already been set aside by the High Court, the only questions to be decided in these two appeals are: a) Has the Customs Broker violated Regulations 10(b), (d), (e) and (n)? b) If the answer to (a) above is YES, can the imposition of penalty of ₹ 50,000/- under Regulation 18 be sustained? c) If the answer to (a) above is YES, can the forfeiture of the entire security deposit under Regulation 14 be sustained? d) If the answer to (a) above is YES, has the learned Principal Commissioner erred in not cancelling the licence of the Customs Broker? 5. The appellant Customs Broker filed four Shipping Bills No.6772616 dated 8.8.2018, 6772734 dated 8.8.2018, 6783913 dated 9.8.2018 and 6783966 dated 9.8.2018 for export of goods by the exporter and the Shipping Bills were assessed provisionally by the proper officer after drawing samples on 10.8.2018 and the containers were allowed to be shipped on 16.8.2018. Thereafter, on 20.8.2018, officers of the Directorate of Revenue Intelligence [ DRI ] received intell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be. However, in the present case, Shri Babul Dey joined the Customs Broker firm in July 2018 but the Customs Broker did not get him duly approved by the Deputy Commissioner of Customs or Assistant Commissioner of Customs. Therefore, M/s. M K Saha Co appear to have violated Regulation 10(b). (ii) As per Regulation 10(d), the Customs broker shall advise his client to comply with the provisions of the Act, other allied Acts and the rules and regulations thereof, and in case of non-compliance, shall bring the matter to the notice of the Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be. In the present case, the CB M/s. M K Saha Co did not advise his client to comply with the provisions of the Act. They did not bring to the notice of the department the anomalies. Therefore, they appear to have violated Regulation 10(d). (iii) As per Regulation 10 (e), the Customs broker 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. The Customs B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer and the quasi-judicial order, though not a finalassessment order and though not even a speaking order must be respected. Every assessment, including provisional assessment, is appealable by both the Revenue and the exporter to the appellate authority. Assessment of a Shipping Bill or Bill of Entry need not necessarily result in payment of duty. Where the proper officer needs further information or enquiries, he can resort to provisional assessment and thereafter finalise the assessment. In this case, nothing is presented before us to show that the provisional assessment order has been appealed against or modified by the Commissioner(Appeals). Therefore, the provisional assessment order of the proper officer is still valid. We do not find any provision of the Customs Act under which either a provisional assessment or final assessment can be modified by officers of DRI and a different decision taken. In the case of Jairath International [Punjab-Haryana High Court M/S Jairath International And ... vs Union Of India And Others on 4 October, 2019 CWP No.702 of 2017(O M)], this legal position was clarified by the High Court of Punjab and Haryana. In that case, goods were exported on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms clearance work and hence the question of obtaining the permission of Assistant Commissioner or Deputy Commissioner does not arise at that stage. During hearing, Shri Dey was cross- examined in which he stated that: a) He was the employee of M/s. Behag Overseas and was not and was never the employee of the appellant Customs Broker. b) However, he did some work of business promotion for the appellant customs broker. c) With respect to the consignment in dispute, he stated that he only provided the job to the appellant. d) He did not handle any export consignments on behalf of the appellant customs broker and only earned money from them as a business promotion for providing the job to them. 11. Learned Commissioner did not agree with the arguments of the appellant Customs Broker and the statements made during cross-examination and held that the Inquiry officer was correct in concluding that Shri Dey handled the Customs work of the disputed consignment on behalf of the appellant. 12. We have considered the arguments and the evidence before us. We find no reason to doubt the cross-examination and hold that Shri Babul Dey did the export work of the disputed con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exporter had committed a fraud and that the appellant Customs Broker has colluded with the exporter in such a fraud. At any rate, valuation of the goods is to be done by the exporter (self assessment) or proper officer (re-assessment). We do not find anything remotely in the Customs Act, Rules and Regulations which gives the Customs Broker any power with respect to valuation of imported or export goods. We, therefore, find that there is no evidence to establish that appellant has violated Regulation 10(d). Regulation 10(e) 14. This regulation requires the Customs broker to exercise due diligence to ascertain the correctness of any information which he imparts to a client with reference to any work related to clearances of cargo or baggage. In the impugned order, learned Principal Commissioner held that on scrutiny of the offence report, documents recovered and statements of Shri Babul Dey, Shri M K Saha and Shri Sumit Saha, it appears that the Government revenue would not have suffered, if the Customs broker had exercised due diligence to exhaustively scrutinize the documents of the exporters, which they failed to do. Thus, prima facie, indicated that the CB has not exer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the statement of the exporter (who said that the Customs Broker, i.e., the appellant, was arranged through some other persons). We do not find anything in Regulation 10(n) that mandates how the documents should be handed over by the exporter/importer to the client. All that is required is that the KYC documents must be received and verified to ensure the identity of the client which is not in doubt even according to the SCN itself. Therefore, the charge of violation of Regulation 10(n) against the appellant Customs Broker cannot sustain. 16. In view of above, we find that the findings in the impugned order that the appellant Customs broker has violated Regulation 10(b), 10(d), 10(e) and 10(n) cannot be sustained and need to be set aside and we do so. The answer to Question (a) in paragraph 5 above is NO. 17. Consequently, the answers to (b), (c) and (d) are also negative. 18. In view of the above, the Stay application filed by the Customs Broker stands disposed of. Revenue s appeal is rejected and Customs Broker s appeal is allowed and the impugned order is set aside with consequential relief to the appellant Customs Broker. (Order pronounced on 07/Dec/2021). ..... X X X X Extracts X X X X X X X X Extracts X X X X
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