2012 (9) TMI 985 - AT - Customs

Summary

Issues Involved:
1. Violation of Regulation 12 (subletting of CHA license).
2. Violation of Regulation 13(a) (failure to obtain authorization from clients).
3. Violation of Regulation 13(d) (failure to advise clients to comply with Customs Act).
4. Violation of Regulation 13(n) (failure to discharge duties with utmost speed and efficiency).
5. Appropriateness of the punishment imposed.

Summary:

Violation of Regulation 12 (Subletting of CHA License):
The appellant's CHA license was found to be sublet to third parties, which is against Regulation 12 of CHALR, 2004. Statements from various individuals, including the appellant, confirmed that the license was used by others for a monthly fee, proving the charge of subletting.

Violation of Regulation 13(a) (Failure to Obtain Authorization from Clients):
The Inquiry Officer found that the charge under Regulation 13(a) was not proved. The appellant had obtained proper authorization from their clients, which negated the charge of failing to obtain authorization.

Violation of Regulation 13(d) (Failure to Advise Clients to Comply with Customs Act):
The charge under Regulation 13(d) was initially held as proved by the Inquiry Officer. However, the Member (Judicial) found that since the appellant had obtained proper authorization and had no knowledge of the misdeclaration/suppression, the charge under Regulation 13(d) would not sustain.

Violation of Regulation 13(n) (Failure to Discharge Duties with Utmost Speed and Efficiency):
Similar to Regulation 13(d), the charge under Regulation 13(n) was also initially held as proved. The Member (Judicial) concluded that without knowledge of the misdeclaration/suppression, the charge under Regulation 13(n) would not sustain.

Appropriateness of the Punishment Imposed:
There was a difference of opinion between the Members. The Member (Judicial) held that the punishment already suffered by the appellant (suspension since 12-12-2008) was sufficient, following the decision of the Hon'ble High Court of Bombay in the case of M/s. K.M. Ganatra & Co. The Member (Technical) disagreed, emphasizing the gravity of the offense and the complete abdication of responsibility by the CHA, which warranted the punishment imposed by the Commissioner.

Majority Decision:
The Vice-President, acting as the Third Member, agreed with the Member (Technical) that the charges under Regulations 13(d) and 13(n) stood proved despite the charge under Regulation 13(a) not being proved. The Vice-President also found that the punishment of debarring the appellant from operating in Mumbai Customs Zone was appropriate and upheld the order of the Commissioner.

Final Judgment:
In view of the majority decision, the order of the Commissioner of Customs debarring the appellant CHA from operating in Mumbai Customs Zone under Regulation 20(c) of the CHALR, 2004 was upheld, and the appeal filed by the appellant was dismissed.