2010 (1) TMI 1057 - AT - Customs

Revocation of CHA licence - breach of Regulations 12, 13(a), 13(b), 13(d) and 13(e) of the CHALR, 2004

Issues Involved:
1. Suspension and revocation of CHA licence.
2. Breach of Regulations 12, 13(a), 13(b), 13(d), and 13(e) of the CHALR, 2004.
3. Examination of evidence and findings of the Inquiry Officer.
4. Validity of the charges and the appropriateness of the punishment.

Issue-wise Detailed Analysis:

1. Suspension and Revocation of CHA Licence:
The appellant-company's CHA licence was suspended by the Commissioner of Customs on 19-3-2008 under Regulation No. 20(2) of the Customs House Licensing Regulations, 2004. This suspension was challenged and subsequently, the licence was revoked by the Commissioner of Customs through orders issued on 25-8-2008 and 22-8-2008 under Regulation 22(7) of the CHALR, 2004. The revocation was due to customs clearance work related to two shipping bills filed by M/s. Darshan International and six shipping bills filed by M/s. Kumar Enterprises, where the CHA was found to have committed breaches of several regulations.

2. Breach of Regulations 12, 13(a), 13(b), 13(d), and 13(e) of the CHALR, 2004:
- Regulation 12: The appellant was accused of violating Regulation 12 by allowing Shri Vikas Doshi to use their CHA licence. However, the Tribunal found no evidence of the CHA licence being sold or transferred to Shri Vikas Doshi, as all shipping bills were signed by an employee of the CHA. Thus, the first charge was not proved.
- Regulation 13(a): The appellant was found to have violated Regulation 13(a) by filing export documents without written authorization from the exporters. The Tribunal noted that the appellant did not have any written authorization from the exporters, and the case law cited by the appellant's counsel was not applicable due to the specific facts of this case. Therefore, the charge of breach of Regulation 13(a) was proved.
- Regulation 13(b): The appellant was charged with violating Regulation 13(b) by allowing Shri Vikas Doshi, who was not an employee, to handle the export consignments. The Tribunal found that the appellant allowed Shri Vikas Doshi to transact business at the Customs Station, which was a violation of Regulation 13(b). Hence, this charge was also proved.
- Regulation 13(d): The appellant was accused of not advising the exporters to comply with the Customs Act and not bringing non-compliance to the notice of the department. The Tribunal found that the appellant did not have any direct interaction with the exporters and thus could not have advised them. This charge was proved based on the appellant's chosen method of dealing with the export consignments.
- Regulation 13(e): The appellant was charged with not exercising due diligence to ascertain the correctness of the information imparted to the client. The Tribunal found that the appellant did not ensure the correctness of the declared particulars in the shipping bills, particularly when filed under claim for duty drawback. This charge was also proved.

3. Examination of Evidence and Findings of the Inquiry Officer:
The Inquiry Officer found all charges against the appellant to be proved, and the Commissioner upheld these findings. The Tribunal reviewed the records and evidence, including statements under Section 108 of the Customs Act, and found substantial evidence supporting the charges of breach of Regulations 13(a), 13(b), 13(d), and 13(e).

4. Validity of the Charges and the Appropriateness of the Punishment:
The Tribunal upheld the findings of the Commissioner and noted the serious nature of the breaches committed by the appellant. The Tribunal referenced the observations of the High Courts in Sri Kamakshi Agency and Worldwide Cargo Movers, emphasizing the responsibility and trust reposed in a CHA. The Tribunal concluded that the revocation of the licence coupled with the forfeiture of the security deposit was a fitting punishment for the appellant's serious offences.

Conclusion:
The appeal was dismissed, and the revocation of the CHA licence was sustained. The Tribunal found that the appellant committed breaches of Regulations 13(a), 13(b), 13(d), and 13(e) of the CHALR, 2004, and upheld the punishment of licence revocation and forfeiture of the security deposit.

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