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TMI Blog2025 (5) TMI 1375X X X X Extracts X X X X X X X X Extracts X X X X ..... ms (Preventive), New Customs House, New Delhi. The NCTC in its e-mail dated 19.07.2023 provided the details of major suppliers of the exporter. The goods were found on examination to be in accordance with declaration in respect of the quantity. The goods were placed under detention in terms of Section 110 of the Customs Act, 1962, vide detention memo dated 25.07.2023. Physical verification of registered premises of M/s S.S. Enterprises [the exporter], was conducted under a search authorization issued by the Assistant Commissioner wherein the firm was found non-functional at its declared place of business. The supply Chain of the exporter was also found dubious as most of the suppliers, GST Registrations were either suspended or cancelled suo moto and the exporter was found non-existent at its registered place of business. Thus, the department formed an opinion that the exporter is engaged in just paper transactions to defraud the Government exchequer by claiming export benefits based on fake invoices. It was alleged that the exporter attempted improper export of goods, to avail undue export benefits such as drawback, RoSCTL and IGST refund on strength of purchase invoices issued by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arned Authorized Representative for Revenue. 4. Learned counsel for the appellant submitted that the appellant is alleged to have failed to fulfill its obligation under CBLR only on the ground that the exporter was found non-traceable at his declared place of business. A perusal of Regulation 10(n) as has been invoked, makes it amply clear that the CB is obligated to verify correctness of Importer Exporter Code (IEC) number, Goods and Services Tax Identification, Number (GSTIN), identity of his client and functioning of his client at the declared address by using reliable, independent, authentic documents, date or information. It is submitted that it is a settled law that the responsibility of a Customs Broker under Regulation 10(n) does not include keeping a continuous surveillance on the client to ensure that he continues to operate from that address and that he has not changed his operations. Reliance is placed on the judgment passed in the matter of M/s Bright Clearing & Carrier Private Limited Vs. Commissioner of Customs (A&G) and Star Carriers Vs. Commissioner of Customs (A&G)- 2022 (11) TMI 935 - CESTAT NEW DELHI wherein it has been held that it is not the respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is no urgent need for the same. Learned Commissioner failed to appreciate the fact that in the present case the last export for which shipping bill was filed by the petitioner was of July, 2023 and the suspension order has been issued on 08.03.2024 after almost 9 months of filing the last shipping bill. Accordingly, the appellant prayed the suspension of the CB license of the appellant be revoked on the said ground of lack of any urgency. Appeal is prayed to be allowed. 7. While rebutting these submissions, learned Departmental Representative mentioned that the Customs Broker's actions demonstrate clear violations of Regulations 10(d), 10(e) and 10(n) of the CBLR, 2018. The CB facilitated fraudulent transactions by a non-existent exporter, thereby attempting to defraud the government exchequer. It is further submitted that the purpose of licensing a customs broker is to ensure responsible representation of importers/exporters while adhering to rules and regulations. The broker's failure to fulfill his obligation indicates a breach of trust and responsibility. Learned Departmental Representative impressed upon that with respect to role and responsibilities of customs br ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the record, we observe and hold as follows: 11. The proceedings originated from Show Cause Notice (SCN) No. 11/2024 dated 22.02.2024, issued by the Additional Commissioner of Customs, SIIB, ICD Tughlakabad (Export), following an alert from the NCTC regarding three shipping bills dated 15.07.2023, following observations was made: (i) Physical examination of the goods by Customs Preventive officers on 25.07.2023 revealed discrepancies. (ii) Registered premises of M/s SS Enterprises, the exporter, were found non-functional; (iii) Suppliers of the exporter were suspended or had canceled registrations, a dubious supply chain. (iv) The exporter was found engaged in paper transaction to claim fraudulent export benefits. SCN No. 11/2024 proposed confiscation of goods, denial of export incentives, and imposition of penalties under the Customs Act, 1962. M/s United Cargo Services (Customs Broker) was also implicated for violations under the Customs Brokers Licensing Regulations (CBLR), 2018. Vide the impugned show cause notice dated 20.05.2024 alleged violation of Regulation 10(d), 10(e) and 10(n) of CBLR, 2018, by the appellant. As impressed upon by learned Departmental ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot obligate the CHA to look into such information which may be made available to it from the exporter/importer. The CHA is not an inspector to weigh the genuineness of the transaction. It is a processing agent of documents with respect to clearance of goods through customs house and in that process only such authorized personnel of the CHA can enter the customs house area. That the allegations made against the Appellant / Customs Broker that the CB have facilitated the Shipping Bills on behalf of the exporter M/s SS Enterprises by mis declaring the value of the goods, did not bring the non-compliance of the provisions of the CBLR, 2018 and therefore, the same does not attract violation of Regulation 10(d) and 10(e) of CBLR, 2018. Regulation 10(n) is reproduced below: "10- Obligations of a Customs Broker (n) verify correctness of Importer Exporter Code (IEC) number, Goods and Services Tax Identification Number (GSTIN), identity of his client and functioning of his client at the declared address by using reliable, independent, authentic documents, date or information." This Regulation requires to CB to verify correctness of Importer Exporter Code (IEC) number, Goods and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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