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2016 (12) TMI 1571 - AT - CustomsImposition of penalty u/r 114 of the CA, 1962 on CHA - levy on the ground that the appellant being CHA has not verified the credential of the exporters - Held that - at the time of filing of shipping bills, the exporter has produced IEC and ICEGATE statements and other 11 documents to verify their address and same was not being disputed. It is not required for the appellant to verify the address of the exporter/importer physically. Therefore, we hold that the appellant has taken due care while processing the export documents to check credentials of the exporter - penalty set aside - appeal allowed - decided in favor of appellant-CHA.
Issues:
- Penalty imposition under section 114 of the Customs Act, 1962 for failure to verify exporter's credentials by a Customs House Agent (CHA). Analysis: The appellant, a CHA, challenged an order imposing a penalty of ?50 lakh for allegedly not verifying the exporter's credentials. The appellant argued that they had verified the credentials through IEC and ICEGATE statements and other documents, which confirmed the exporter's address. Additionally, proceedings under CBLR, 2013 were initiated but set aside by the Tribunal in a previous order. The appellant contended that the penalty should be set aside. The Revenue, represented by the learned AR, opposed the appellant's argument, stating that the CHA must be vigilant in verifying the exporter's address and authenticity, which the appellant failed to do. It was also mentioned that the exporter was non-existent and the appellant did not produce them for verification. After hearing both sides, the Tribunal considered the submissions. It was noted that the penalty was imposed on the appellant for not verifying the exporter's credentials. However, it was found that the exporter had provided IEC and ICEGATE statements and other documents at the time of filing shipping bills, which were not disputed. The Tribunal held that physical verification of the exporter's address was not necessary for the appellant, and they had taken due care by checking the credentials through documents. Referring to a previous case, the Tribunal concluded that since the appellant had complied with KYC norms, there was no justifiable ground to impose a penalty. Therefore, the impugned order imposing the penalty was set aside, and the appeal was allowed.
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